Gold Doesn’t Glitter for Advisors

Originally posted by Yuval Bar-Or on Jun 05, 2011  

I was recently informed by one of my former students that some advisors don’t like to acquire gold for their clients. The stated reason is that they may not be compensated for bullion transactions and are therefore more likely to try to convince clients not to make such purchases. While a decision not to purchase gold for a client may be correct for a variety of reasons (liquidity and diversification come to mind), the decision should not be motivated by the advisor’s compensation mechanism. This is yet another case of potential conflict of interest for advisors.

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