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How to Buy Gold
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Gold is a great investment because it maintains its value in the long term. It's an excellent hedge against inflation because its price usually rises when the cost of living increases. The price also rises when the dollar declines. Gold should be part of every investment portfolio. Read on to learn about the best ways to buy gold.
Gold Bullion
Gold bullion, available in gold bars and gold bullion coins, includes items that are bought strictly for investment. Gold bullion coins and bars are minted by many national mints in major countries around the world. One-, 10- and 100-ounce bars are popular. You can also buy gold collectible coins, which can range from 19th century circulated coins to Disney collectibles that are produced today. Collectible coins are priced higher than the identical size gold bullion coins.
Gold ETFs
A gold ETF, or exchange-traded fund, is a commodity ETF that focuses on one commodity: gold. More than 32 gold ETFs, managed by gold experts, are traded in United States financial markets. With an ETF, you can own small amounts of numerous different investments within a single fund. Therefore, you get diversification even if you don't invest a lot of money. You can buy a single share of an ETF for less than $100.
Gold ETNs
A gold exchange-traded note (ETN) is a product designed to track the price of gold. The value of a gold ETN is dependent on the movements of a stock index or other benchmark. ETNs were created by Barclays investment bank in 2006, and they have become an alternative to ETFs. Contrary to ETFs, ETNs don't actually own anything. They are debt notes that include a promise to pay an amount on the maturity day.
Gold Mining Stocks
You can invest in shares of gold mining companies. More than 300 gold mining companies are listed and publicly traded. With gold mining stocks, you're making a bet on gold prices. As the value of gold becomes higher than a miner's cost of production, profitability moves up dramatically. The growth and return in a gold mining stock depends on the expected future earnings of the company as well as on the value of gold.
Buy Online
If you're buying gold for the first time, it's a good idea to invest in gold bullion coins. They are highly liquid, secure, convenient and budget-friendly. There are several reputable online companies that buy and sell gold as well as silver and other precious metals. APMEX, the world's largest online retailer of precious metals, offers a wide variety of products. You can also buy gold from multiple sites online.
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