Golden Opportunity

Now is the time to invest in gold. It’s been in a glorious bull trend for the past 7 years, and it’s increasingly looking like a breakout, and heading to prices that have been unheard of in the past.

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How to get into gold:

Physical Gold
The easiest an simplest way to own physical gold is to buy coins. These coins are currency, and as such are produced for the major countries under license. 1 troy ounce South African Krugerrands have the lowest premium over the spot price of gold, as they’re not very “pretty” coins. These are ideal for investments, and are probably the most widely held forms of physical gold. Other coins such as Canadian maple leaves, US Eagles and UK sovereigns are also quite common, but tend to have a larger premium over the spot price of gold. Larger amounts of gold can be bought in bars, although these need to be assayed before sale. This inconvenience means the bars are significantly less liquid than the coins. The biggest worry about holding any amount of gold is the security implications. Ample security arrangements and insurance should be arranged before organising the supply of your gold. If you’re buying your physical gold online, have a look at http://www.kitco.com in the US, or http://www.goldline.com in the UK.

In the past few years, a number of alternatives to holding the metal yourself have sprung up:

Online Gold Holding
Goldmoney (www.goldmoney.com) and Bullionvault(www.bullionvault.com)
Both of these services are like online banking, but your account is denominated in amounts of gold. These companies aggregate many individual holdings into storage of London Bullion Market good delivery bars. These 400 troy ounce bars are outwith the reach of average investors, but as the holdings are merge, the advantages of these bars come to the fore. Low prices over spot and secure storage are major features of these services. The gold is stored in secured and insured communal vaults, often around london.

ETFs
ETFs such as the Gold Tracks service (ticker GLD) allow gold to be traded like stock. This makes it ideal to be added to portfolios such as pensions and retirement accounts that cannot normally access the price of gold. Holding gold in this way can take advantage of tax rules, and provides a good long term method for preserving returns. This can also be quite a liquid investment, as you can buy and sell in the same way ans any other stock.

Spread Betting
All spread betting companies allow you to make bets on the spot price of gold. As ever with spread betting, trades are easy and can be heavily leveraged. This brings i’s own advantages and disadvantages, and is quite possibly the riskiest way to invest in the gold bull. Being tax free and having the potential for incredible gains tempers the risk though. Spread betting is definitely an option to be considered.

If the unthinkable happens and a global economic or political crisis brings down the normal rules of society, there’s only one option. Physical gold. This metal has been used as the monetary basis for centuries, a position which is unlikely to come to an end anytime soon. In all other scenarios, a more liquid alternative can be found giving flexibility and increased returns.

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