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When the stock market becomes choppy, investors want to protect themselves by using precious metals. Silver, gold, and palladium are not immune to price fluctuations. However, many see them as a great long-term investment.

It is impossible to hold physical precious metals with a regular IRA account. This is where a precious metals self-directed IRA comes into the picture. These are specially designed IRAs that allow you to invest in silver, gold, palladium, and other valuable metals.

Some wonder how much of their IRAs should be a precious metals self-directed IRA. While it is best to talk to a financial advisor to get advice specific to your financial circumstances, most would agree that when investing in precious metals, one should do so conservatively. Many experts believe that between five and 10 percent of your retirement funds should be in precious metals.

The reason why professionals recommend that is because a good portfolio is diversified. This means that they don’t take a ton of risk by investing in just one type of asset. No sound financial advisor would recommend throwing all of your assets into precious metals.

Another reason is that although precious metals have historically held their value for the long haul when compared to other assets, they usually lag in performance. If your goal is to grow your retirement funds, you may be hamstringing yourself if all of your assets are in precious metals.