When global markets shiver, people turn to gold and silver. They also buy bullion for reasons related to prosperity, marriage, etc. Indeed, investing in gold, silver, and platinum makes tremendous business sense for investors. If you have bought or considering to purchase physical metals (gold, silver, platinum, copper, and zinc), think these points. Though there are several investment tips, we have limited our advice to just 5 points.
1. Physical coins and bars
It is easy to invest in precious metals when you buy physical coins and bars. Most savvy investors prefer to purchase gold and silver bars and coins. Since there is so much demand for coins and bars, bullion sellers give the most competitive prices to the sellers. You may prefer to buy 1 oz gold or silver coins.
Please note that bullion prices are always higher than spot prices so that you will have to an absolute premium. This premium causes retail gold prices to increase against wholesale prices. When you buy gold bars and coins, you get the following benefits;
- The government cannot reach this investment easily
- Perfectly legal tenders by the government (in case of coins)
- Highest purity
- Difficult to counterfeit
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Ever since they were launched in the 2000s, Gold ETFs have become very popular among the investment community. The main reason is that these instruments are as flexible as stocks and shares. Some gold ETFs report millions of AUD transactions every day. You can invest in ETFs if you think keeping gold bars and coins is a cumbersome activity.
3. Gold mining stocks
Why not invest in gold indirectly? This means why not buy shares of companies in gold mining operations? Many gold investors find this option convenient. If you have a comprehensive brokerage account, you can buy stocks of any gold mining activity.
However, please note that your share price may not rise simply because the gold price is increasing. The former may depend upon several external factors like government policy, environment, etc. The most significant advantage behind this investment tool is that your shares can be traded easily, and you don’t have to worry about storing the bullion.
4. Gold options and futures
If you have a short-term investment option, you may consider entering the gold options and futures market. This means you sign contracts with other traders based on an underlying gold price. Institutional traders are very active in the gold options and futures markets. It is estimated that in the U.S alone, the size of this market is more than 20 million ounces of gold.
Investors can make money based on rising and falling gold prices in the international markets. The biggest attraction in this method of investing is you get greater exposure than in cash markets. However, consider entering the futures market if you have an appetite for risk.
5. Gold investing through Individual Retirement Funds
If you aren’t sure about the above four tips, consider using your IRA. This strategy is for all those into long term investments. You may talk to your investment advisor while using your retirement fund. Please note that your precious metals investment strategy should vary from metal to metal.
While gold and silver strategies are similar, platinum needs a different tactic. The same goes for strategic metals like copper and zinc. Prices of platinum and silver also depend upon their industrial applications. If you want to invest in either of these metals, please track the solar panel and car industries.