7 ways to invest in gold

There are many options available to people interested in investing in gold. Investments can be made by purchasing and storing physical gold, purchasing items that represent ownership of gold, or buying shares.

7 ways to make gold investments № 1 – gold coins

Governments of several different countries issue gold bars as legal tender. The value of gold coins is determined by their smallness, or the ratio of the actual gold content to other materials in the coin. Demand and supply can also affect the price. Common coins include the American Golden Eagle, the Canadian Golden Maple Leaf, the South African Krugerrand, the Australian Golden Nugget, the Austrian Philharmonic, the Chinese Golden Panda, the British Sovereign and the French Coq Gaulois.

7 ways to invest in gold № 2 – gold bars

Gold bars are the most traditional form of investment in gold and are sought after by many central banks around the world. Ingots are available to investors in a variety of sizes such as one pound, ten ounce, one ounce, ten gram and 100 gram. One of the most popular gold bars is the London Good Delivery bar, which weighs 400 troy ounces. In general, bullion has lower price premiums than gold coins, but investors should always be wary of counterfeits. Bars should always be purchased with a certificate.

7 ways to invest in gold № 3 – ETFs

Exchange-traded funds, or ETFs, are traded similarly to stocks on major stock exchanges. For gold ETFs the American Stock Exchange is the main place to trade. ETFs buy a lot of gold and keep it in storage. They then issue stocks that match the price of the bars. If prices rise by 5%, then individual ETFs will also rise by the same 5%. ETFs allow investors to easily trade and buy in small quantities. ETFs may require a small storage fee annually.

7 ways to make gold investments № 4 – Certificates

Certificates represent ownership of gold without requiring the investor to actually store the bullion. Dedicated certificates are associated with the possession of certain ingots, which are stored in individual banks. However, unallocated gold certificates do not guarantee equal exchange for ingots if the gold of the issuing bank is retained. Certificates have historical significance in the United States, where they were considered legal tender from 1882 to 1933.

7 ways to invest in gold № 5 – accounts

There are five types of accounts: allocated, unallocated, gold pools, electronic currencies and gold accumulation plans. Dedicated accounts allow investors to own ingots or coins stored in a vault managed by a recognized depositary or ingot dealer. Unallocated accounts do not represent ownership of certain bars. Gold pool accounts allow people to invest very small amounts. Electronic currencies allow investors to make payments online using a currency pegged to accumulated gold. Then the accumulation plans are similar to savings accounts in which investors purchase a fixed amount for each month.

7 ways to invest in gold № 6 – derivatives

Derivatives include options, futures and forwards. These financial instruments can be traded on multiple exchanges around the world or through private trading. Gold futures are most often traded on the New York Mercantile Exchange and on Euronext.liffe in the US

7 ways to invest in gold № 7 – mining companies

Buying shares in a mining company is another investment option. As the price rises, the mining company’s profits are expected to rise, leading to an increase in the company’s share price. There is some market volatility associated with mining shares, but many companies will hedge the price in advance to reduce these fluctuations.