Czechs consider gold and real estate to be the best investment

Prague - Czechs consider gold along with real estate to be the most suitable long-term investment. Every second Czech would choose real estate as ideal, while 28% of people would opt for gold. This is based on a financial barometer conducted by Ipsos among more than 1000 respondents who purchased property with a loan.
    Investment in gold is seen by Czechs (43%) as the least volatile, while 23% think the same about real estate. "It is a long-held misconception that gold or real estate cannot be loss-making and their prices do not fluctuate. Over the long term, gold, right after stocks, is the most volatile investment. After all, it was only eight years ago that the real estate bubble burst in the American market, and prices literally fell by thousands of dollars overnight. However, according to research, it seems that Czechs have forgotten this," said investment specialist Partners Martin Tománek.
    Every tenth respondent considers bonds to be the best long-term investment. According to him, some may be committing one of the basic mistakes, which lies in clinging to recent trends. Bonds have indeed been a very good investment in recent years, but this was primarily due to the persistent decline in interest rates, which are currently at historic lows, Tománek pointed out.
    Czechs also idealize the average long-term return on gold. Most often, they believe it ranges between three to five percent above inflation. This was stated by 39% of respondents. Every fifth Czech even thinks it is between six to ten percent. However, in the long term, the returns are around the level of inflation, or approximately one percent above inflation. According to the research, only 11% of respondents knew this.
    "Over the long term, stocks are the most profitable. Even government bonds, the traditional investment for conservative investors, have provided a higher real return than gold," Tománek noted. Last year, gold was even highly loss-making, with a decline of 26%.
    In 1980, the price of gold reached its previous peak. The gold rush is usually directly related to the economic and political developments in the world. At the end of the 1970s, there was significant uncertainty in global politics and economics, the oil shock, double-digit inflation rates in the USA, the USSR's invasion of Afghanistan, and the American hostage crisis in Tehran, Tománek recalled.
    However, the price of gold did not stay at its highs for long. After reaching its peak in 1980, the price was in a downward trend for a long twenty years. In nominal terms, the metal lost more than 60% of its value in less than eight years. "Gold reached another peak three years ago when the price approached the $2000 per ounce mark. Since then, there has been a significant correction. Therefore, gold cannot be unequivocally considered a stable and safe investment and can only be recommended as a small supplement to an overall portfolio," Tománek concluded.