Disclaimer: Some or all of the companies listed on this page my provide compensation to us. This is how we maintain our free service for consumers that visit us. Compensation & hard research determine where and how companies appear below.
There are several ways to invest in gold, each with its risks and potential rewards. Many people buy gold as a hedge against economic uncertainty, but there are other safe ways to invest in gold. Additionally, one should consider investing in physical bullion or coins rather than ETFs.
How Can You Invest in Gold?
Physical gold, such as coins or bars, allows you to hold the metal. This can be a good option if you want to have the ability to physically hold and see your investment. However, it also carries the risk of theft and the need for secure storage.
Investing in a mutual fund or ETF that tracks the price of gold can be a convenient way to gain exposure to the metal without holding it physically. These investments are subject to the same risks as other mutual funds or ETFs, such as mismanagement or under-performance.
Investing in gold mining stocks allows you to benefit from the performance of gold companies rather than the price of gold itself. However, these stocks are subject to additional risks, such as changes in the price of gold, operational risks at the company, and management changes.
A safe investment in gold tends to be physical bullion or a gold ETF or mutual fund that holds only physical bullion. The combination of the price of gold and the expense ratio of an ETF can make this less than ideal. Anytime you buy something other than physical bullion, you take on additional risks with that investment.
If you buy shares of a mining company, there is a risk in buying a company not directly involved in holding and selling physical bullion. Gold mining stocks can also be affected by market sentiment. If people begin to fear that economic conditions are deteriorating, for example, then they might become concerned about these individual companies and sell their stock.
Global political and economic conditions influence the price of gold, so when there is a downturn in the financial markets or a currency crisis, a rise in the value of gold tends to follow.
This makes it risky to invest in gold globally, and instead, it makes more sense to invest in regional currencies that serve as a hedge against a downturn in the global economy.
Gold prices fluctuate, so deciding if it's a good time to buy before prices climb is important. If you're unsure, only invest what you can afford to lose.
Gold coins are likely the best investment in gold but have the most associated risk. For example, you can't easily change your mind after buying a coin, and they are very easy to find as demand increases over supply. Some people complain about the safety of holding gold coins in their possession; because they are not real currency, there is a small chance that some counterfeit or fake coins could be passed off for the real thing (in which case any losses would be difficult or impossible to pursue).
As a general guideline, the prices of gold coins tend to be higher than those of gold bullion. In order to sell your investment, you will need to find someone willing to pay a premium for the coin or bar over the price at which you bought it. If you cannot do so, it might be worthwhile if all other costs are considered, such as capital gains taxes and storage fees.
What Are the Advantages of Investing in Gold?
There are several advantages to investing in gold. It's free to transfer across international borders, and its physical nature makes it difficult to manipulate.
Gold is resistant to economic and political cycles and tends to be an effective hedge against inflation, financial crises and currency devaluations. As such, when held as a store of value, gold tends to outperform other assets, especially those highly correlated with gold prices.
Gold is often considered a hedge against inflation because it tends to maintain its value over time, even when the value of other assets, such as stocks and real estate, decline. This is because the supply of gold is limited, which can help to preserve its value in the face of rising prices for goods and services.
Gold can be a useful diversifier for an investment portfolio because it tends to have a low or negative correlation with other assets. This means that gold may hold its value or even increase when other assets, such as stocks and bonds, are performing poorly.
Gold is often considered a haven asset, which means it is perceived as a relatively stable and low-risk investment. This can make it an attractive option for investors looking to reduce their portfolio's overall risk. It is also a highly liquid asset, which can easily be bought and sold in global financial markets.
What Companies Should You Invest In?
Several companies produce gold and gold-related products. Some companies specialize in bullion, others in gold coins and bars, which means there are various market specialists for different areas of the industry. This article recommends the top five companies you can trust.
#1. Goldco
Goldco is a precious metals investment and retirement planning company based in California. The company was founded in 2006 and has since become a leading provider of gold and silver IRA accounts and other investment products and services.
Goldco offers a range of precious metals investment options, including gold, silver, platinum, and palladium. Investors can choose to hold these metals in a physical form, such as coins or bars, or the form of ETFs (exchange-traded funds) or mining stocks. The company also offers a range of investment strategies and guidance to help investors make informed decisions about their precious metals investments.
In addition to its precious metals investment products, Goldco also provides retirement planning services, including assistance with setting up and managing a precious metals IRA. This type of account allows investors to hold precious physical metals, such as gold and silver, in a tax-advantaged retirement account.
It is important to carefully research and evaluate any company before making an investment decision and to consider seeking the advice of a financial advisor or other professional before making any investment choices.
Pros & Cons of Goldco
Pros
Cons
Why We Chose It
Goldco provides a variety of precious metals investment and retirement planning options. As well as providing precious physical metals such as gold and silver, it also offers gold-based products through its IRA investments, including gold IRAs and precious metals IRAs.
Augusta Precious Metals was founded in 2012. The company sells physical bullion (e.g., coins and bars ) directly to its customers without requiring them to buy through another market participant or broker. The precious physical metals are sourced from several trustworthy, high-quality vendors who produce their bullion in compliance with the industry's best practices.
Augusta Precious Metals also operates a network of branch offices across the United States and has partnered with financial institutions to offer precious metals investing as a retirement planning option.
The company has been carefully crafted with the customer in mind, and the company strives to serve investors with a simple, transparent process that's easy to access, understand, and use.
Pros & Cons of Augusta Precious Metals
Pros
Cons
Why We Chose It
Augusta Precious Metals' approach to sourcing gold bullion should help investors feel confident when making purchases from the company. Undoubtedly, the gold-backed wealth products offered by Augusta Precious Metals are genuine pieces of gold bullion.
American Hartford Gold was established in 2015 and is headquartered in the United States. The company sells gold-backed retirement and precious metals products backed by physical bullion. American Hartford Gold functions as a broker and distributor of gold-backed IRAs, which means that the company does not hold physical bullion of its own.
The company is one of the safest providers of gold IRAs, having been established for many years, with a large network of affiliates and representatives. It also has built a large customer base over time, from which it can grow its business even further.
American Hartford Gold holds a strong reputation for integrity as a credible and reliable gold IRA provider, is highly regarded among customers and professionals in the industry, and has been awarded an A+ Accredited Business rating by the Better Business Bureau (BBB).
The company offers a product suite that is varied and customizable, enabling investors to choose which products they need or want and how they want to invest their gold. American Hartford Gold is committed to providing the highest level of service possible, and it has been working hard through its affiliates and representatives to ensure that it meets the needs of each of its customers.
Information about how to buy precious metals via gold IRAs is freely available on the company's website, and customers can contact the 24/7 customer service team should they need help.
Pros & Cons of American Hartford Gold
Pros
Cons
FAQs
Are gold coins a good investment?
Yes, gold coins are considered the best investment for the following reasons:
Should Investments in gold be for the long term?
Yes, gold may be a good investment for the long term. However, it is important to understand that gold prices may fluctuate dramatically.
What is the best way to buy gold?
The easiest way to purchase gold is through a traditional gold IRA or other forms of self-directed retirement plan. If you're setting up a gold IRA, make sure that you choose reputable dealers.
The safety of gold Investment strategies can vary greatly. However, any gold IRA is a legitimate way to buy metals without leaving yourself vulnerable to fraud or being forced to sell at the wrong time. Furthermore, precious metals are the safest way to store money and do not lose value over time.