Investing in Gold
Every kind of investment has it’s pros and cons. Today I’ll show you the upsides and downsides of investing in gold. You will find out a couple of interesting stuff, you’ve probably had no idea about.
Some people think that investing in gold is not that profitable anymore. I will try to convince you that it’s still worth it. Since the beginning of the year, you could make 260 USD one an ounce. So how to invest?
Buying gold bars or bullion coins is theoretically the easiest option for a regular person, however, you have to remember that the price of physical gold is different than the one bought in a form of contract. Unfortunately, financial market investments are less obvious and they demand more knowledge and experience. Of course there are ways of dealing with this problem.
How to invest
First, you have to find a gold dealer, from whom you can buy gold. You have to check if this person is credible and trustworthy. You should choose the offer that comes from the big and serious salesman, who are already established on the market.
Another information that it’s worth to know is that a lot of investors value their privacy and discretion. It applies especially to huge investments. The only thing that will guarantee anonymity is purchasing gold with cash.
There is no sure fire formula for storing gold safely. Keeping it in a home safe might end up with a theft. DIY compartments won’t guarantee 100% safety. Better option is to keep the gold underground in the garden or other isolated place.
Don’t entrust storing gold to the dealer. If you did that, what would be the point of buying a physical metal? To get it stored by someone else? In my opinion every type of “buy and store” offer is simply not worth it.
Gold is widely acceptable money, however, you won’t get the best deal everywhere. Every good dealer offers buying gold.
Cons of investing in gold
The first major con of investing in gold is that it’s not an investment that brings profit instantly. Therefore, it’s not a good option for people who count on quick money. It’s exactly opposite: gold is a long term investment, and it’s best to buy it in the times of prosperity. Another drawback is that gold investment is only cost-effective, when the market situation is stable, as the gold is the cheapest then. When there are other goods which offer quicker and bigger return, a lot of people would pass on this opportunity. Difficulty with choosing the method of investment would also be a con. There are a few options on the market, however, not all of them are worth recommending. One of those options is to sign a contract that will make you an owner of the gold only through a record in a system. The truth is that there is not enough of gold on the market to cover all those options. If all the investors wanted to get their gold, it could turn out that there just is no actual metal for all of them.
Pros of investing in gold
The major pro of gold investment is that your savings are protected – inflation doesn’t affect gold, unlike like regular money. Despite the fact that, just like every other assets, gold undergoes the market processes – it’s price sometimes increases and sometime decreases – the general trend is that it brings profit. Gold is also good for people who don’t trust the banking system and don’t like to keep their money on the account or deposit. After the 2008 crisis, worrying about the condition of banks is rational and gold is a good alternative. Another upside of investing in gold is that the actual process is relatively simple. You don’t have to follow a lot of different values or have a deep understanding of how the market functions. Gold investment require analyzing only one value: price of gold in time. You have to know a little bit about it, however, trading on a stock market or Forex is far more complex. In the end it’s worth to mention that some of the cons of gold investment can be seen as pros by some people. It concerns the physical metal, as you have the full control over it, you can store it independently, and you have constant access to it. It will definitely make some people invest.
Thank you for your time and I hope you’ve learned something that will be useful to you.
Have a nice day!
