For the second year in a row, investors remain optimistic that gold will shine in 2019 as they search for stability in an environment of growing uncertainty and volatility, according to a survey conducted by international investment firm Legg Mason.
According to the firm’s Global Investment Survey 2018, 23% of investors said that they see gold as one of the best investment opportunities next year, unchanged from 2017. The firm said that it contacted 16,810 investors for its survey.
While gold’s potential has remained reasonably stable, holding in fourth place, investor sentiment has shifted slightly compared to last year.
The latest results show that 32% of investors expect that real estate will see the best investment opportunities in the next 12 months, up from 30% reported last year. Tied with first place, but falling from last year’s standings, 32% of investors think equities will offer the best opportunities next year, down from 34% in 2017.
Rounding out the top five, 31% of investors expect international equities to outshine next year and 21% see the best gains coming from alternative assets. Both asset classes saw sharp increases from 24% and 10%, respectively.
“It is perhaps understandable that, after such a prolonged bull market for equities, investors have once again looked to safe havens such as gold and cash,” said Alex Barry, head of U.K. distribution at Legg Mason, commenting on the finding. “However, they must consider the return profile of such assets. Taking gold as a case in point, the asset has failed to deliver for investors this calendar year, and it remains hard to see a catalyst for it currently.”
The firm’s report noted that gold’s safe-haven appeal is particularly strong in the United Kingdom. The survey indicated that among U.K. investors, 25% see the best opportunities in gold next year, third only to international equities at 19% and real estate at 27%.
The report noted that U.K.’s exit from the European Union remains the biggest threat to investors’ portfolios.
Although gold has struggled to gain widespread attraction among international investors, Legg Mason said that affinity for the yellow metal is slowly growing.
The report noted that gold’s allocation in a portfolio increased to 5% in 2018, up from 4% reported last year.
Reported by Jack Dempsey, President
401 Gold Consultants LLC