Indexing is a way to link rate of return to a stock market index without actually investing in the market. The principal investment is made in a guaranteed account with various financial institutions, each with their own set of pros and cons. The actual vehicle may be a CD, bond, note or annuity. Meaning accounts can be held at an investment bank, brokerage or insurance company. The issuing institution guarantees the principal investment and in some cases can in turn be backed up by the FDIC or State Guaranty Funds.
When markets decline there will likely be zero interest earned in the indexed plan. Having 5, 10 or even 15 percent of a portfolio in gold and silver is generally sound diversification strategy and a good way to hedge against inflation. I work with a Nationwide wholesaler that will ship direct to the buyer. For IRA purchases, the IRS requires the gold and silver be held by a third party custodian.
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