Mark and Tom discuss the revision of Warren Buffett’s recent shareholder letter, which explains why over time, stocks have beat alternatives – including gold. He says gold doesn’t produce anything, and buyers of gold are just banking that down the road, someone else will pay more than they’re paying for it today. He admits gold can be decorative and has some industrial use, but gold itself is not of much use. Investors may want to consider that gold is not a preference of Warren Buffett when weighing the pros and cons of investing in this commodity.

By showing the risk and return of gold as compared to IFA portfolios from 1977 - 2011, IFA Indexes and other individual stocks, Mark and Tom invite viewers to see how gold has performed over a 35-year period.

Chart: Why Diversify? Stocks vs. Indexes