Investing can be a tricky thing given the current market volatility. From the Wuhan Coronavirus crisis to the U.S – China Trade war, fluctuations in the market can very quickly make or break your investment portfolio. Through all of this, precious metals such as gold, silver and platinum can be seen to be a solid investment (pun intended). From the gold standard to humanity’s obsession with converting lead into gold, gold has always been treasured and jealously hoarded since time immemorial. Gold investing is the contemporary hoarding tool.
From a totally objective standpoint, some have argued that gold does not have any kind of intrinsic value whatsoever. It’s shiny and inert which means that it does not react with other metals.
Then what is it about gold that makes it so desirable? In the olden days, gold was used in decorations and wearable jewelry. In times of war, people would convert their possessions into gold which could then be easily transported or smuggled out. Nowadays, gold is used in a variety of roles. Besides fashion, gold can be found in the electronics and dental industries where it’s high melting point and inert nature make it extremely useful.
Because it acts as a store of value that has been trusted for centuries, even today gold is still widely regarded by many as a investment. Forget about dealing with shady dealers who’ll trick you into buying worthless baubles or tack on expensive premiums, when gold investing or in other precious metals, you want to get your money’s worth. And to do that, you’ll need to choose the right IRA company. To get you started, here is a comprehensive guide on the top companies that you should consider.
So, if you’re looking to shore up your portfolio with some gold investments, how would you go about doing so?
Good thing you asked, in this article we’ll be taking a look at how you can invest in gold.
- Buy physical gold
The simplest and most straight-forward way for you to get your hands-on gold would be to simply buy it. Gold bullion coins or bars are your best bet and can be purchased from any authorized dealer.
When making a purchase, always take care to ensure that you’re buying the real thing and not any kind of imitation.
Having purchased your gold bullion, store it in a safe and secure area away from prying eyes. Alternatively, you can always store your gold and other valuables in a safe deposit box at your local bank.
While you could be charged a fee for this service, the peace of mind you’ll be able to enjoy is simply invaluable.
- Invest in gold mining corporations
While gold coins and bars may have a physical presence, gold mining stocks are one of the most easily liquidated gold assets. Unlike gold bullion, stocks can easily be bought and sold on the marketplace with relative ease.
If you’re looking to liquidate your physical gold assets, you’ll have to find an actual buyer and arrange for the logistics of handing it over after the purchase has been made.
Another benefit of purchasing stocks offered by gold mining companies is the opportunity for your stocks to appreciate. In leaner times when the demand for gold rises, chances are good that your shares will also increase in value thus netting you a decent profit.
However, shares are not for everyone as there is an element of risk involved. Given the highly controversial nature of the mining industry, government intervention and other global factors may put your investment at risk.
If you’re looking to invest in gold mining corporations, you should do plenty of research before jumping in.
- Purchase gold ETFs
Gold ETFs or gold exchange traded funds are stocks that derive their value from an underlying asset which in this case is gold. These ETFs are traded on the stock-exchange and are widely regarded as a relatively stable asset in times of economic and political turmoil.
In a nutshell, ETF prices are directly proportional to the value of gold i.e. when gold increases in value so does the price of said ETF.
For example, when the price of the USD is expected to fall, investors naturally flock to precious metals such as gold in order to hedge against any potential loss. This in turn drives up the value of gold which has a positive effect on gold investing ETFs.
Check the gold price predictions for the next 5 years on Currency.com. Now would be a great time to snap up some gold ETFs. Although, it should be noted that ETFs only consist of gold futures and contracts which means that purchasing ETFs is not actually a way to get your hands-on physical gold.
Gold investing has shown itself to be a valuable safe haven investment for many years now. Given the uncertainty of the future, this fact will not likely change anytime soon.