Top 5 Ways of Purchasing Gold for Investment Purposes

Preserving your wealth, if at all you have any, is becoming increasingly complicated and difficult to say the least. A big financial crisis is always round the corner in most of our lives. In such a situation it becomes more and more important to come up with ways to invest and try to increase your limited wealth to a substantial amount. And, gold investment is undoubtedly one of the best ways of creating wealth, and it has been tested for generations together.

That being said, how and where to buy gold for investing is something very few people are aware of. We have mentioned top 5 ways of purchasing investment gold that can grow your wealth over a period of time.

• Gold Coins: There are many retailers like Amazon that offer gold coins for online purchases. Because of the continuously increasing demand of these coins post 2008 financial crisis, these coins have become limited and hence expensive. When you buy a gold coin, make sure you don’t pay too high compared to the present spot price or else getting benefit of future appreciation may become difficult. This is even more important when you are purchasing smaller gold coins from private sellers or collectors such as those listed in eBay.

• Gold ETFs: Exchange Traded Funds of Gold is one of the best options of investing in gold in a smart and educated way. These are especially popular with private investors as they still are one of the most economic and safer ways of investment in markets. ETFs can be held in different accounts like pensions, retirement fund accounts or stock accounts. Gold ETFs are typically invested in a basket of commodities or a single commodity. The range of ETFs available includes both physical metal ETFs and paper based ETFs.

• Gold Mutual Funds: Common private investors may get confused about investing in companies that hunt for gold or involved in Gold mining. The best alternative is investing in mutual fund that invests in different firms in the sector of gold mining. This reduces risks considerably as there are expert financial investors who indirectly invest your money in gold mining companies. The one downside of this option is the annual charges are very high compared to Gold ETFs.

• Gold Jewellery: The pricing of gold jewellery varies depending on the purity of the gold used. Whenever you buy gold jewellery it is strongly recommended to go for reputed stores to make sure you don’t get ripped off by a store selling you inferior quality products. This type of investment is extremely popular in countries like Indian and other middle-east countries. In fact, India has a huge market for gold jewellery.

• Shares in Gold Mining Firms: Buying shares in such companies is almost like owning the yellow metal itself. The pricing of shares of gold mining firms normally trend to track the gold price, even though many of these companies purchase other raw materials as well. This is why the prices of the share are sensitive to overall economic conditions. Some of the big gold mining companies also have their shares listed n London Stock Exchange. But the share prices of smaller mining companies can be very volatile to say the least. If these mining companies manage to find gold in their reserves their prices soar but if they fail, the pricing of their shares crash.

Steve Kelly is a serial investor who often invests in different FTFs. Steve also likes writing articles on his personal blogs about investment in different options like gold, mutual funds, stocks etc.