Diversification is the one strategy common among the very few billionaires in this world. They distribute their wealth in different assets but metals like gold, silver, palladium, and platinum tend to become a favorite because of its ability to punch above its weight.
Name: Jeffrey Gundlach
How he makes his billions: Bonds is his thing
Net Worth: $2.1 billion.
Why he is buying gold: He uses gold as a hedge against what he sees as a weakening U.S. dollar.
Name: Naguib Sawiris
How he makes his billions: Various investments including mines
Net Worth: $2.9 Billion
Why he is buying gold: Sawiris buys gold as a means of crisis protection. He put half of his net worth in gold in mid-2018 in an effort to protect himself from a potential stock market crash and to take advantage of gold’s potential upside. His investment has clearly paid off.
Back in April of 2018, Sawiris said that people tend to go to gold during crises. Athe time, he already believed we were in a crisis.
Name: Paul Tudor Jones
How he makes his billions: Hedge fund
Net Worth: $5.1 billion
Why he is buying gold: Tudor buys gold as an antidote for equities. He knew that gold “will be the antidote for people with equity portfolios” amid fears of a global economic downturn, including the real possibility of a U.S. recession in the future.
Jones told Bloomberg back in June of 2019 that gold “has everything going for it in a world where rates in the U.S. are conceivably going to zero.
Name: Sam Zell
How he makes his billions: Real Estate
Net Worth: $5.5 billion
Why he is buying gold: Zell told the Bloomberg news service in January 2019 that he bought gold for the first time in his life as a “good hedge.” Although Zell didn’t cite the type of hedge, gold is widely known as a hedge against inflation, currency depreciation, and the weak performance of various other asset types.
Name: Ray Dalio
How he makes his billions: Founded of the world’s biggest hedge fund
Net Worth: $18.7 Billion.
Why he is buying gold: In a July 2019 post on LinkedIn, Dalio said that one factor tipping the balance toward gold is that too many other asset types are plagued by low returns. On the other hand, gold performs well when currency is depreciating and when domestic and international conflicts are flaring. It also creates a ‘better balanced’ portfolio that includes gold could reduce risk and enhance returns.” He says a well-diversified portfolio should contain a decent share of gold.
Name: Lord Jacob Rothschild
How he makes his billions: Banking
Net Worth: $5 Billion
Why he is buying gold: In 2016, Lord Jacob famously declared that the Rothschild family was dumping the U.S. dollar and replacing it with other currencies, as well as gold. Changes in yields and monetary policy prompted that shift.
Name: Stanley Druckenmiller
How he makes his billions: Founded the Duquesne capital
Net Worth: $4.7 Billion
Why he is buying gold: Druckenmiller managed to generate an average annual return from his fund of 30%, with an incredible run of success that ran from 1986 to 2010, without ever having a losing year in all that time.
Druckenmiller quit while he was ahead and closed his fund in 2010, but the key point to note is that he subsequently holds 20% of his entire portfolio in gold.
Name: David Einhorn
How he makes his billions: Founded the Greenlight Capital in 1996
Net Worth: $11 billion
Why he is buying gold: Having suffered many losses, Einhorn realized that only gold can actually protect him against inflation.
He believes that the Fed’s intervention in markets has added to the attraction of holding gold over green, which is why his fund continues to hold about 10% of its value in gold bullion.
These are some of the billionaires protecting their wealth through gold and other metals.
When a group of people worth billions are doing the same thing, it’s worth looking into.
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