If you have been toying with the idea of investing in gold, there are a few things you need to know about before you buy online. Here are a few top tips to get you started.
Firstly, Gold is Gold
Gold is undoubtedly a foundational investment. It’s not merely a piece of paper like a bond or stock that promises future payments. Instead, gold is tangible. You can hold it in your hands and it has a good value. Banks could go bankrupt and governments could fail, but gold will remain to hold its value.
Buyers, Always Beware
When it comes to trading in gold, ignorance is definitely not bliss. Metal is a costly investment to delve into, and there are unsavoury people out there waiting to take advantage. The key to spotting a scam is knowledge and education, and avoiding ill investments. See what City Gold Bullion in Brisbane have on offer for your investments.
Know What Kind of Investor You Are
Are you a play-it-safe kind of investor or would you prefer to hedge against inflation? For many, investing in gold could be part of a well-balanced portfolio. But, how you prefer to invest will steer you in the right gold buying direction.
Understand Bullion
It’s important to understand that bullion is sold as coins or ingots, and is sold by weight. The coins and ingots come in a variety of sizes, with gold bars starting out at one ounce and going up from there in price and weight. The most popular one-ounce coins include:
- The Canadian Maple Leaf
- The South African Krugerrand
- S. Gold Eagle
Coins that have a numismatic value often command premium.
Think About Your Investment Portfolio
To begin with, it’s a good idea to invest no more than around ten to fifteen percent of your entire portfolio. While gold is certainly liquid, since its price can bounce somewhat, it’s often better to hold onto bullion in the long term. Let the professionals deal with day trading.
Make Sure You Understand Your Investment
It’s wise to understand that gold bullion is an investment that is not going to generate a great deal of income while you are holding onto it. It won’t earn interest and it won’t pay dividends. But, it’s also not going to incur income taxes, and you will only face capital gains tax when you sell.
Buying Rare Coins
The most important thing to do is to find a dealer that you can trust. Keep in mind that the price, overall, is going to depend on condition and rarity. You need a reputable dealer who will give you a fair price. A good sign is a dealer who guarantees to buy back the coins at the price you paid for them. Make sure the dealer also adheres to high standards and is a member of a professional organization. If you’re new to investing in rare gold coins, maybe pick one coin to become an expert on at first.
Understand Bullion Pricing
The spot price is gold’s current market price that can be delivered right away. Here are a few more things to know:
- The dealer must pay a bid price to acquire a gold bullion.
- The difference between the buying and selling price is the spread.
- You will pay the asking price.
- The asking price is calculated on the metal’s spot value and there is an additional premium.
- Gold prices fluctuate all the time.
When you understand what you’re investing in, you will be able to get the most out of it. Remember all the tips discussed in this article and be an expert investor in no time.
