Time For A Portfolio Review

Accelerating U.S. Debt Load Could Mean A Riskier Economy

Many economists and investors have been focused on the debt crisis in Europe. But did you know that debt in the United States is now more than 90% of GDP, a sign of increasing economic risk? In fact, the gap between debt and GDP has narrowed considerably over the past two years (see Chart 1 below). This is placing increasing strain on the U.S. economy. Is your portfolio prepared to weather this uncertainty? Now is the time to review your portfolio and make sure you're adequately diversified among stocks, bonds, cash and Gold — the fourth asset class.

In today's video, APMEX Chief Executive Officer Michael Haynes talks about how growing debt levels in the U.S. are creating greater uncertainty in our financial markets. He also explains how a diversified asset allocation may help minimize risk in your portfolio.

The Role Of Gold In A Balanced Asset Allocation

In the three years from January 2008 to December 2010, a hypothetical portfolio with a relatively small 10% allocation to Gold would have generated 45% of its returns from Gold (see Chart 2). While historical performance is not a guarantee of future results, in this case, strength in the price of Gold helped offset the weakness in U.S. and global equities, which generated none of the return during the same time period.

This is possible because Gold historically tends to perform independently of other investments. In addition, Gold is not tied to any individual economy or currency and is not affected by any country's level of debt, and is recognized and accepted globally.

The new year is the perfect time to review your financial goals and your asset allocation strategy to make sure your portfolio is properly diversified based on your investment horizon and economic outlook over the next three to five years. We invite you to take our 3 minute investor quiz to assess your investing mindset and long-term economic outlook. It can be especially important to know your investing personality as you review allocations in your IRA, 401(k) and personal portfolio.

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If you want to help ensure greater stability in your portfolio, we encourage you to consider diversifying your portfolio with an allocation to Gold— the fourth asset class. Our knowledgeable Account Managers are available Monday through Friday from 8 a.m. to 6 p.m. (EST) at 888-518-7464.