People who are planning to invest in gold have three choices to take: buying the metal itself, purchasing gold funds, and purchasing gold options. Those who want to invest in gold bullions can choose the forms of gold bars or coins. The more sophisticated investors may opt for trading gold futures or futures options. Mutual funds and exchange-traded funds investing in precious metals or shares of mining firms can be a more liquid and low cost means to invest. You can read more about this in Money Morning.
Buying the Gold Bullion
Gold is highly accessible to the average investor because it’s easy to purchase the gold bullion which is the actual yellow metal in coin or bar form. This can be purchased from a bank, a precious metals dealer, or from a brokerage. Bullion bars are available in sizes that range from a quarter-ounce wafer up to a 400-ounce brick. New investors however prefer the coins more. Buying gold jewelry also gives the investor the chance to wear his or her investment. It is often combined with other gems and metals to enhance its overall appearance and value. These pieces of jewelry can be passed on to the next generations as heirlooms.
Buying Gold Futures Options
Seasoned investors who don’t want to spend a lot on capital may opt for gold futures or options on a gold ETF. With these contracts, the investors have the right but not the obligation to to buy or sell gold at a particular price for a particular period. Investors can use Options whether they think the price of gold is going up or down. If the guess is wrong, the maximum risk is the premium paid by the investor in entering the contract. Find out more about this at the Money Morning site.
There are many benefits to investing in physical gold. For one when there is any sort of turbulence in the global equity markets or when political tensions arise between powerful nations, you can expect a steep price hike.
When you invest in gold or other assets that are considered safe, you are well protected from the risks of inflation. Gold has been known to have outperformed inflation rate through the years.
It is also a good way to save money for the future. It’s not possible for you to invest small amounts when you invest in real estate. However, there’s a simple investment that you can do, which is to invest in physical gold.
It’s not hard to maintain a physical gold investment. It is easy for you to safekeep them for hundreds of years. If you invest in a property, you have to maintain it appropriately and this can take a lot of your time and energy. You can simply buy gold and keep it in the locker for years.