One of the primary advantages of investing in gold is that it is comparatively strong at holding its value. This is due to the fact that internationally, the demand for gold almost always outweighs supply. So, with respect to an investment, gold is a reasonably safe way to protect your savings because you are investing in a commodity that will always have a certain amount of value.

On the Other: Long-Term Appreciation

The disadvantage with gold in comparison to others ways of maintaining savings is that the profit you get through appreciation tends to come in small increments over time. Generally, gold is looked at as a long-term investment. Buying and trading in gold jewelery requires protection against damage and theft, so insurance costs have to be counted against returns.

Bottom Line

Investing in gold with respect to protecting assets is basically a wash. While there is a certain stability in the fact that gold will always have some value, as an investment it has not done well since the early 1980s. As far as protecting capital goes, while you might escape the possibility of loosing your savings in a bank failure by owning gold, you have to find a way to secure and insure the gold you possess, and the risk of theft is probably at least as great as the risk of getting caught in a uninsured bank failure.

Source:

Think Finance: Pros and Cons of Investing in Gold