There are plenty of ways to invest in gold — more than just buying bullion or buying stocks. In this article, we’ll be analyzing those ways, as well as looking into more indirect methods of gold investing.
If you’d like to see more lists on ways to invest, check out this article on investing without buying stocks, as well as this article on all the best ways to invest, period. If, however, you’re looking for ways to add gold to your portfolio — just read below.
Direct Ways to Invest in Gold:
- Bullion Bars. Buying gold bars is great if you’re investing a huge amount of money and are looking to store wealth for a significant period of time. This is why bars are popular for central banks and other large financial institutions. For a small-time investor, maybe not such a great idea.
- Bullion Coins. Same as above, only smaller and easier to sell to other investors if necessary. This is great if you want to store a substantial amount of money, but don’t have the facilities to store tons of gold. Can be stored in much smaller places than bars. Note: bullion coins and rare coins should be considered different investments.
- Stored Gold. You don’t actually have to physically own the gold you buy — it’s possible to buy gold and have it stored at the dealer’s warehouse. Some entire companies exist that sell gold — for example, BullionVault and SilverSaver both give you that option.
These are the direct ways to own gold bullion. Of course, there are plenty of other investments that don’t perfectly track the price of gold, but are still greatly influenced by gold. You can learn more below.
Indirect Ways to Invest in Gold:
- Gold Stocks. Gold mining companies are often extremely volatile, risky, and can be quickly worthless. Or, if you buy the right ones, they can be mind-blowingly profitable, outperforming actual gold prices several times over.
- Gold ETFs. Gold exchange-traded-funds usually track the price of gold, and some even claim to be backed by gold. Still, they’re paper assets that don’t allow you to actually own the gold if you like — and they’re very likely loaning out the gold they claim to own. I often use ETFs for short-term speculation because it’s easy to do so.
- Gold Mutual Funds. Gold mutual funds can own gold themselves, or gold mining companies, or even gold ETFs, or even other gold mutual funds. For example, the Permanent Portfolio Fund is a mutual fund that owns resource companies as well as physical gold and silver bullion. As a disclaimer, I have money in the Permanent Portfolio Fund.
- Rare Coins. For some reason, people think buying rare and old coins is a great way to get gold exposure. They’re not. These coins are worth, usually, more than the gold in the coin, but they are much more volatile and are usually overpriced. Don’t confuse rare coins with gold bullion coins — same amount of gold, different investment class entirely. If you’re not a rare coin expert, it’s probably a good idea to stay away from these entirely.
That’s the short list of the ways to invest in gold — both directly and indirectly. If you’d like to learn more about gold, click here to join our free gold newsletter, buy gold right now, or learn what I think the future of gold and silver really is.
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