Gold: From Ancient Times to Modern Portfolios

Reading Time: 3 minutes

Often perceived as a mere luxury, gold is a multifaceted asset with a rich history and enduring appeal. This series uncovers the layers of this precious metal. From its storied history to its modern-day investment implications, we will explore the various facets of this precious metal. Join us as we uncover the reasons behind gold’s enduring appeal and its potential role in your investment journey today in this 4-part series.

Part I: Gold: More Than Just a Pretty Metal

A Glittering History

Gold, the shimmering metal that has captivated humanity for millennia, is far more than just a symbol of wealth and luxury. Its history is intertwined with the evolution of human civilization, shaping economies, cultures, and societies.

The famous phrase “Midas touch” originates from Greek mythology about King Midas, who supposedly had the ability to turn anything he touched into gold. This highlights gold’s long-standing association with wealth and prosperity.

Various civilizations, such as the Indus Valley, the Pharaohs of Egypt, the Chinese dynasties, and the Roman Empire, accumulated and hoarded gold as treasures. The rise of gold’s importance was primarily driven by basic demand and supply—gold was not as freely available compared to other resources, leading to its higher valuation.

Aureus (Coin) Portraying Emperor Nero - Blog on History of Gold by Windmill Capital — _{The Roman Empire, at the height of its influence, recognized gold’s value as a currency and a symbol of imperial might. The aureus, a gold coin bearing the image of Emperor Nero, is a prime example. These coins, minted in the 1st century CE, were not merely currency but works of art, showcasing the empire’s opulence and the emperor’s divine status.}

The Properties of Gold

Gold also had (and still has) certain properties that made its adoption convenient. It could be easily molded, stored, and transported. As human civilizations emerged in different parts of the world and societies moved away from the barter system, gold became a natural choice to serve as a standard of value.

Gold as a Medium of Exchange

Yuval Noah Harari, in his best-selling book “Sapiens,” notes that gold money first appeared in ancient Mesopotamia in the middle of the third millennium BC. Other civilizations quickly adopted this form of money due to its convenience and ability to be standardized. The vast Roman Empire left a lasting impact by minting its own gold and silver coins, which carried the seal of the Roman Empire.

The trust people had in these coins was such that “in the first century AD, Roman coins were an accepted medium of exchange in the markets of India, even though the closest Roman legion was thousands of kilometers away,” Harari adds.

Conclusion

Gold’s journey from ancient civilizations to modern economies highlights its enduring value and significance. In our next article, we will explore why gold bullion and coins were not allowed to be physically held by citizens of some countries and its emergence as a valuable component of a diversified investment portfolio.

Check out other articles in this series below.

Part II: The Rise & Fall of the Gold Standard

Part III: Gold – Stability in Uncertain Times

Part IV: Buying Gold After the 2024 Budget: Which Option is Best for You?

Disclaimer: Investment in securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of a SEBI recognized supervisory body (if any) and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.

The content in these posts/articles is for informational and educational purposes only and should not be construed as professional financial advice and nor to be construed as an offer to buy /sell or the solicitation of an offer to buy/sell any security or financial products.Users must make their own investment decisions based on their specific investment objective and financial position and using such independent advisors as they believe necessary.

Windmill Capital Team: Windmill Capital Private Limited is a SEBI registered research analyst (Regn. No. INH200007645) based in Bengaluru at No 51 Le Parc Richmonde, Richmond Road, Shanthala Nagar, Bangalore, Karnataka – 560025 creating Thematic & Quantamental curated stock/ETF portfolios. Data analysis is the heart and soul behind our portfolio construction & with 50+ offerings, we have something for everyone. CIN of the company is U74999KA2020PTC132398. For more information and disclosures, visit our disclosures page here.

Naveen K R

Senior Director, Windmill Capital | The content in this article is purely the author’s personal opinion and is for informational and educational purposes only. It should not be construed as professional financial advice and nor to be construed as an offer to buy /sell or the solicitation of an offer to buy / sell any security or financial products. The views and opinions stated in the content belong to the author. Windmill Capital Private Limited does not uphold nor promote any of the views / opinions. | Windmill Capital Private Limited is a SEBI registered research analyst (Regn. No. INH200007645)

Cancel reply

Dislaimer: This platform is intended for informational purposes only and is not intended to provide investment advice. The stock prices displayed are delayed and may not reflect the most current market conditions. Investment in securities market are subject to market risks. Read all the related documents carefully before investing. You can also consider consulting a financial advisor before making any investment decisions. Smallcase Technologies Private Limited shall not be responsible for any losses that may occur as a result of using this platform.

The views expressed in this article are those of the author and do not necessarily reflect the views of Smallcase Technologies Private Limited (STPL) or any of its associates. The information provided in this article is for educational and informational purposes only. Investors are responsible for their investment decisions and are responsible to validate all the information used to make the investment decision. Investors should understand that his/her investment decision is based on personal investment needs and risk tolerance, and performance information available on here is one amongst many other things that should be considered while making an investment decision. Past performance does not guarantee future returns.

Investments in securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of BASL (in case of IAs) and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors. The examples and/or scurities quoted (if any) are for illustration only and are not recommendatory.

The content and data available on the website, including but not limited to index value, return numbers and rationale are for information and illustration purposes only. Charts and performance numbers do not include the impact of transaction fee and other related costs. Past performance does not guarantee future returns and performances of the portfolios are subject to market risk. Data used for calculation of live returns and other information is provided by exchange approved third party vendors and has neither been audited nor validated by the Company. Detailed return calculation methodology is available here. Detailed volatility calculation methodology is available here.

The user agrees to assume complete and full responsibility for the outcomes of all of his/her investment decisions that he/she makes, including any direct, indirect, incidental, consequential, special, punitive or any other losses/damages if any that may be incurred by him/her. Smallcase Technologies shall not be responsible or liable for any direct, indirect, incidental, consequential, special, punitive or any other losses/damages arising out of the recipient's investments. For disclosures related to Smallcase Technologies Pvt Ltd, please visit this page .

All smallcases present in the articles are created by SEBI licensed entities. The disclosure of these entities can be found below: