Investors often seek refuge in gold when economic conditions deteriorate or foreign crises throw the markets into a spin. With inflation surging and the stock market trading irrationally, some investors seek a secure and profitable investment asset with a reliable track record of growth, which they usually get in gold.
Investors choose to buy gold coins for various reasons, and the commodity has characteristics that have made it a worthwhile alternative to traditional assets like equities and bonds. Investors choose gold for their potential to store value, even though it is a cash-generating asset. Gold is seen as a tool for hedging inflation by some since the Fed Reserve's boosting policies and increased government spending have fuelled inflation.
If you are interested in investing in gold, there is no single way to do it. Here are some of your options:
1. Physical Gold Bullion
In comparison to other commodities, gold is more accessible to the common investor, since it is possible to acquire gold bullion from a precious metals dealer, or, in certain situations, a bank or brokerage firm.
Purchasing gold in bars or coins is one of the most straightforward investment options. Physical gold can be held in your hands - it isn't just a number on a screen. However, gold ownership can also have risks, especially if you have significant holdings. For example, gold can be stolen and needs to be insured.
Gold's pricing is straightforward, and the metal is particularly liquid. The metal's value is available via the spot gold price, which is continuously updated. The spot price makes the basis on which gold coins and bars are sold, and therefore it is very easy for bullion owners to ascertain the value of their investment.
You can buy your favorite gold bars and coins from SuisseGold.com. SuisseGold.com's bullion pricing features a live feed, which updates the price of all gold bars and coins on the website every few minutes in line with the market price. When investing in physical gold, it is the spot price that is the most relevant.
2. Gold Futures
Gold futures are a different way to speculate on the price of gold. Generally, investors who buy gold futures are not interested in taking physical delivery.
The biggest advantage of investing in gold via futures is the large amount of leveraging instruments available. For example, a deposit of £1,000 will allow an investor to purchase £50,000 worth of gold depending on the broker. However, this type of trading is incredibly risky, and the majority of investors who use highly leveraged accounts suffer significant losses.
The futures market should be reserved for skilled investors, and you'll need a broker that offers futures trading, which not all big brokers do.
3. ETF Gold Purchasing
If neither physical gold ownership or futures positions are of interest, then another option is an exchange-traded fund, or ETF. The purpose of an ETF is to imitate the price of gold. However, ETF's have fees and expenses, which also should be taken into account.
One benefit of an ETF over physical bullion is that it may be converted to cash at market prices more readily. You can liquidate your funds at the current market price on the open market. As a result, gold ETFs have higher liquidity than physical gold.
4. Mining Stocks
Another way to benefit from increasing gold prices is to purchase gold mining firms.
However, when investing in mining stocks, it is vital to completely understand the company. Many mining companies operate in countries that aren't completely transparent, and this can be challenging for investors. Generally, it is advisable to avoid small mining stock. Finally, mining stocks, like other types of stocks, are volatile.
Conclusion
Gold trading is not for everyone. It comes with risks and exposure that needs to be carefully considered. Physical gold ownership is considered the safest form of bullion investing. If you are interested in buying gold bars or coins and would like more information, please visit suissegold.com, or contact us directly.
