4 important gold investing moves experts say to make this fall

In an economy with elevated but cooling inflation, a volatile stock market, and other factors, diversifying your investments is more important than ever. Gold is a popular choice for this purpose, as it works as a safe haven, often protecting your dollars against inflation and fluctuations in other asset classes.

It can also provide growth, as evidenced by gold's price climbing from under $2,000 per ounce to more than $2,400 per ounce over the last eight months. In fact, according to the World Gold Council, it's one of the highest-performing asset classes of the year so far, offering year-to-date returns of over 12%. 

Are you considering investing in gold this year? We asked some experts for their suggestions on how to approach the investing as we head into the fall. 

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4 important gold investing moves experts say to make this fall

Considering a gold investment heading into the cooler months? Here's how some experts suggest you proceed:

Buy sooner than later

There are two reasons you may want to buy gold now, despite its high price. For one, though it already hit record highs this year, there's still room for growth.

"It's difficult to find an investment that has outperformed gold," says James Cordier, a commodities expert and founder of the Cordier Commodity Report. "Yet it still has fundamental factors pointing towards a continuation of this trend." 

It's true: If the Federal Reserve moves to cut interest rates this fall, gold prices could jump further. Studies show that interest rates and gold prices tend to have an inverse relationship, wherein one rises and the other falls. But this is not always the case.

Fed Chairman Jerome Powell has already indicated a rate cut is "on the table" for its September meeting, but recent inflation data — which shows inflation below 3% for the first time in years — makes that even more of a possibility. According to the CME Group FedWatch Tool, there's a 100% probability of a rate cut in September — either 25 or 50 basis points.

The fact that many central banks have been buying up gold in recent years is a good sign, too, Cordier says.

"For the last two years running, records have been broken by what's considered to be 'strong hands' — a phrase commonly used in the commodity industry for what's considered to be ultra-long-term investors," he says. "Central banks have been these large buyers, and historically speaking, they're excellent company to have when investing in gold."

On top of the potential growth gold has to offer, there's also the risk of a recession or dip in the stock market to consider. If this were to happen, investments in gold could help provide some protection. 

"Gold represents a portfolio hedge since it does not move in sync with the stock market," says Rick Miller, an investment advisor representative and owner of Miller Investment Management in Manassas, Virginia. "There is plenty of evidence to support the recession contention."

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Sell if you need the cash

If you already own gold investments, selling now could net you some serious profits, depending on when you bought in. So if you need cash or are nearing retirement or some other period of need, you may want to take a look at your portfolio and what those assets could be worth. 

"For those with positions in gold — especially long-term ones, now would be an excellent time to take some profits," Miller says.

If you don't need the cash anytime soon though, you may want to hold onto those investments a little longer. If gold prices rise, as stated above, it could mean more growth and more profits. 

Keep your investments reasonable

Most financial professionals recommend devoting only 5% to 10% of your portfolio to gold. 

"Generally, it's a good idea not to invest too much of any portfolio in any one single asset class," says David Hollander, founder of Liberty Group, a wealth management firm in California. Hollander notes that allocating as little as 2% of your portfolio to gold could give you "sufficient exposure" to the metal.

Still, think carefully about your goals, budget and timeline when deciding how much to allocate.  

"Our research indicates that even a modest 4% gold allocation can significantly enhance returns and reduce volatility compared to the traditional 60/40 portfolio without gold," says Ben Nadelstein, head of content at precious metals marketplace Monetary Metals. "You could go as high as 20% for optimal results, depending on your investment objectives."

Explore different avenues

While physical coins and bars might be the first thing that comes to mind when eyeing gold investments, there are actually many more options you can explore — each with different potential risks, opportunities for growth and more.

If you're saving for retirement, for instance, a gold IRA may be something to look into. You can also invest in gold stocks or mining companies, or there are gold ETFs (exchange-traded funds) you can buy shares of, too.

A good investment professional can help advise you on how to best invest in gold. They can also talk to you about how much to allocate to achieve your financial goals.