In many articles on many different websites gold is often held up as a good safe investment, suitable for diversifying a portfolio and guarding against risk. But why is this? What factors go into making gold such an attractive investment option for so many people with widely different investment goals and risk appetites?

Firstly gold is often spoken of as having a high intrinsic value. What this means simply is that the value of gold is held in the material itself and not a mathematical construct as with other investment options. Investors like the security of a physical asset with value rather than a piece of paper signalling theoretical value.

Gold has history on its side, for thousands of years and continuing to this day gold has been seen as a signal of wealth originally only legally available to royalty and aristocracy and this further plays into its intrinsic value. Gold is a relatively rare metal found generally in small quantities and requiring a lot of effort to extract from deep underground. Further refinement to the raw material adds to the complexity of production and limits the overall levels of production at relatively stable levels year on year. This scarcity helps to maintain the value of gold on world markets.

Gold is a safe haven. Historically gold has managed to see out the worst financial crises with relatively little impact upon its value leading to the notion that it is a safe haven in times of economic strife. Gold also has the advantage of a physical presence that cannot simply disappear in market corrections or bankruptcy. This reputation also helps to fuel demand amongst investors seeking to weather the storm of financial turmoil and further maintains the safe haven status.

Demand for gold stretches far beyond the obvious uses. Many will think of jewellery as the prime demand sector for gold however this is not the case. Many industrial processes make use of gold and in particular electronics utilise its tarnish free and high conductivity properties to produce many of the consumer electronic devices in demand in the modern world.

These are just some of the varied attributes which many investors feel make gold a good investment option and valuable part of their portfolio. To see some of the products on offer and find more information and articles detailing some of the other uses of gold check out the website at www.ukbullion.com