Historically, gold has continued to be a precious metal for civilized world. The metal is of significance to women who like to adorn themselves in golden jewellery. Men, on the other hand consider investing in precious metal as a profitable investment, mainly because it is proven to beat inflation. However, investing in golden jewellery isn’t that profitable as it tends to get worn out and likely to get damaged, especially when studded with stones. Here, we’ll explore some of “The Best Ways to Invest in Gold.”
Holding physical gold: The feeling of holding gold in person is unique. Traditionally, most investments in gold are made this way. One may buy gold in the form of coins or bars of varying weight. You may sell the metal in that form or transform it to jewellery. An important advantage of buying coins is that you can keep buying from time to time to lower your average price of purchase. Another benefit is that you pay almost the market price for buying coins, with negligible extra charge. However, care should be taken to buy 99.9 % pure metal from reliable sources like a bank or government mint. You’ll need a secured place for their storage too. The downside is that banks don’t buy back coins or bars and you are left with no option but to sell it through jewelers who charge a premium.
Stocks of mining industries: Investing in companies undertaking mining operations for producing precious metals like gold is another viable option. However, investors may find it challenging to identify a well managed profit sharing company. Advantage of this form of investing is that as the price of gold goes up, most likely the price of stocks will also go up. But again choosing the right company with the necessarily needed modern mining equipment is not going to be easy. Additionally, mining industry itself is prone to many unforeseen delays and expenses.
Exchange Traded Funds: Among “The Best Ways to Invest in Gold” is via electronic or paper form of gold i.e. ETFs or FOFs. Using this mode of investment is akin to investing in stocks. It offsets the drawbacks of retaining gold in physical form. It eliminates the worries of impurities and safe storage. Plus, you can buy as small a quantity as just half a gram! That also makes it the most liquid form of investment as you can receive your funds within 2/3 days of having given the sell order.
Mutual Funds: The most important benefit of investing in mutual funds is that you are able to seek services of professionals, devoted to studying mining industry and choosing an assortment of mining companies for investing your funds. The composition of mutual funds offered by different companies usually varies, as each takes care to circumvent industry specific risks but some may choose to include relatively new companies which are not yet proven. That makes it imperative for investors to go through the prospectus of the company thoroughly.
Time and again gold has proven to have a negative relationship with equities, meaning when the price of equities goes down, the price of gold goes up and vice-versa. That is why experts suggest to include gold as a part of your portfolio to offset the market volatility. So, choose one of “The Best Ways to Invest in Gold” as explained above