Skyrocketing demand for safe-haven assets have caused many investors to look at ways of finding the best gold investment. This has been as a result of large scale migrations away from riskier assets like stocks by investors looking to protect their hard earned wealth by finding a sound safe-haven product in which to invest.This comes as no surprise, especially since the metal has proven its ability to thrive time and time during troubling economic scenarios. Gold’s value has increased more than 400% in the past decade, thus investors continue flocking to this historically powerful safe-haven tool.
Finding the best gold investment that suits your investing goals perfectly should be your main goal when purchasing gold bars and coins and the first step that you want to take is fully analyzing your portfolio in order to understand what products could be best for you. If you seek true security with your gold investment don’t settle for anything less than physical possession bars and coins for inside or outside retirement accounts.
Other forms of investment in non physical products as listed below are far more risky and caution is needed in your risk analysis of them if you intend to invest in any of those products.
Here is an analysis of the different types of products that could be the best gold investment for you
FINDING THE BEST GOLD INVESTMENT IN PHYSICAL PRODUCTS
The physical gold investment market can be separated into two distinct main categories; modern bullion products and certified rare coins. The third option mentioned below of gold jewelry could also be considered.
1. Modern bullion products
Products like the American Eagle and Johnson Matthey bars are useful for short-term profit because they hold very low premiums above the spot price of gold, usually around 5%-7%. However the problem for investors is that the market deals in 400 ounce gold bars costing around $500,000 which can be expensive for a lot of people! A highly reputable gold bullion business called Bullion Vault, partly owned by the World Gold Council and a member of the London Bullion Market Association, has solved this problem. Here investors can choose to buy part of a good delivery gold bullion bar, or even a whole bar if they so wish which makes gold bullion investing much more affordable for many.
2. Certified rare coins.
Coins like the $20 Saint Gaudens gold eagle and $20 Lady Liberties are useful for long-term wealth preservation because their numismatic attributes help them maintain value over the years while at the same time increasing in value when the spot price increases.
While some coins can be purchased in circulated condition for a small premium over the bullion spot price investors should be prepared to pay a very high premium for coins in superb condition. Care should be exercised in only dealing with reputable coin dealers to avoid paying grossly inflated prices.
3. Gold Jewelry.
-
- While primarily a form of personal adornment, gold jewelry can also be considered an investment. The cost depends on the type, weight, and craftsmanship of the jewelry.
FINDING THE BEST GOLD INVESTMENT IN NON PHYSICAL PRODUCTS
- Gold ETFs (Exchange-Traded Funds):
- SPDR Gold Trust (GLD): This ETF aims to track the price of gold. The cost of investing is primarily the expense ratio, which is usually low, around 0.4% or less annually.
- iShares Gold Trust (IAU): Similar to GLD, this ETF also tracks the price of gold and typically has a low expense ratio, around 0.25% annually.
- Gold Mutual Funds:
- Mutual funds like the Tocqueville Gold Fund or VanEck International Investors Gold Fund invest in gold mining companies’ stocks. The expense ratio varies but can be around 1% or higher.
- Gold Futures Contracts:
- Investing in gold futures allows you to speculate on the future price of gold. Costs include commissions and potential margin requirements, which can vary.
- Gold Mining Stocks:
- You can invest in publicly traded companies that are involved in gold mining. The cost depends on the stock price of the company you choose and any associated brokerage fees.
- Gold Options:
- Options contracts give you the right (but not the obligation) to buy or sell gold at a predetermined price. Costs include the premium paid for the options contract.
- Gold IRAs:
- These are retirement accounts that allow you to invest in physical gold or gold-related assets. Costs may include account setup fees and storage fees for physical gold.
- Gold Certificates:
- Gold certificates represent ownership of a specific quantity of gold held by a financial institution. Costs may include administrative fees.
Whichever product you decide on you will find that your gold investment will produce good returns for you in the long term as part of a well balanced and diverse investment portfolio.
James Kelly
High Wycombe, Western Australia,6057