stocks vs precious metals

Both precious metals investments and stocks have their pros and cons

In our aging society, it is increasingly important to plan for retirement. Two common investment vehicles are stocks and physical commodities, like precious metals. Each type of investment carries real benefits, and unique risks.

Here, we will examine the differences between these two popular investment options, their respective risks, and their advantages.

Physical Precious Metals

Physical precious metals include gold, silver, platinum, palladium and copper. Precious metal bullion is usually made into bars, rounds or coins, and when purchased, the owner takes physical possession of the commodity

For an investment in precious metals to be successful, the investor must wait to sell for the value of the metal to exceed the value at the time of purchase.

So why do people invest in physical precious metals?


Precious metals, such as gold and silver, are viewed as a “safe haven” investment when banks are unstable and there is political unrest in a country.

Also, precious metals are used extensively in a variety of industries, and the price of these metals will fluctuate depending on demand.

Additionally, for metals like platinum and palladium that are used to reduce emissions in cars, investors can see an increase in price when regulations on the metal’s applications cause a high demand. At these times, investors can sell at a price higher than what they paid, and turn a profit.

Additional reading: 4 Benefits of Investing in Physical Gold


Even though investing in physical precious metals seems like a very good idea, people need to consider all of the risks.

As with all investments, precious metals can be a gamble. While history has shown that the value of precious metals increases over time, there is no guarantee that they will continue to do so, or to increase at the desired rate. Also, like all financial instruments (stocks and futures included), prices can be affected by large national and international financial institutions.

Another risk of investing in physical precious metals is the danger of theft. Having these metals stored in one’s home provides a higher chance of the metals being stolen during a robbery.

There are risks associated with owning precious metals, buy history has shown that metals carry less risk than stocks and futures and are a great way to diversify a retirement portfolio.

Additional reading: Securing your Precious Metal Investments


When someone owns a stock, it means that they own a claim to part of a corporation’s assets and earnings. These stockholders are not personally responsible for the company’s debts, but the value of the stock is determined by the value of the company. When a public company files bankruptcy, therefore, the value of the stock is significantly impacted.

Stocks are commonly known as “equities” because they are viewed as a way to own a portion of a company. Historically, stocks have outperformed most other investments.


A benefit to owning stocks is that they have huge potential for high returns. Most retirement portfolios include investment in stocks because of the potential return.


Equities are more volatile, and more susceptible to economic swings than physical commodities, such as precious metals. Unfortunately, if the company does not do well, the stockholder cannot expect to profit from their investment.

There is no guaranteed return with stocks, and investors need to realize that buying a stock does not mean they will see a return on their investment. Also, if a company does go bankrupt, stockholders are usually the last to get their money back, since the company’s funds are used to pay off debt.

Physical Precious Metals vs. Stocks: What is Your Choice?

There is risk associated with every investment, and the savvy investor will mitigate those risks with a well diversified investment strategy. If you are looking for a low risk investment that will buffer your retirement against inflation, then we suggest you strongly consider adding precious metals to your investment portfolio.

If you are interested in making physical precious metals your next investment, Provident Metals has what you are looking for. Whether silver, gold or another form of precious metal, we offer the bars, rounds and coins for any size investment.