How to Get Started Investing in Gold

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Gold Bars

With gold having an outstanding 2020 and a promising 2021, more and more people are getting interested in cashing in on this precious metal — and they have all the reason to be. For one, gold can serve as an investor’s hedge against inflation and deflation. It can also be leveraged as a good way to diversify a portfolio that can help minimize risk and vulnerability, even in small amounts.

Financial journalist Royston Wild also explains that as different macroeconomic and geopolitical factors continue to worsen this year, gold will only become an even more viable safe haven that’s set to reach greater highs. If you are one of those people who would like to benefit from the many good things that have been happening to this shiny yellow metal, here are some of the best ways you can get started:

Gold bars and coins

Buy physical gold

The easiest and most straightforward way to start getting exposed to gold is by buying it in its physical form. If you are someone who likes fashion accessories, you can invest in this precious metal by buying gold jewellery. You can also choose to buy gold coins, ingots, and bullions. Because bullion doesn’t have any artistic value, buying one bar would require you to pay a premium over the gold price. Usually, a premium can range from 3% to 10%.

Purchase gold funds
If you want to save yourself from the hassle of owning, transporting, and storing physical gold, another way you can get into the gold market is by purchasing exchange-traded funds (ETFs). ETFs are securities that act like individual stocks and can be traded as such. One of the top-performing gold ETFs is the SDPR Gold Trust ETF (GLD). The largest of its kind, GLD purchases gold directly on behalf of shareholders and can be easily traded on the stock exchange. There is a small management fee of 0.40%, but you do get an expertly and securely managed fund in return. Aside from GLD, other popular gold ETFs include iShares Gold Trust ETF (IAU) and Invesco DB Gold ETF (DGL).

Get gold mining stocks
For those of you who can’t get their hands directly on any gold for whatever reason, you can also invest in gold by getting gold mining stocks. To do this, you would have to buy shares from gold mines like Newmont Corporation and Barrick Gold Corporation through brokerages. Gold mining stocks move up and down with the price of gold, but they do so in a much more exaggerated way. Meaning to say, when the price of gold rises, shares in mining companies climb even more quickly.

Obtain gold futures
Another way you can invest in gold is by obtaining gold futures. Futures are a type of standardized contract that is traded on organized exchanges. They represent the right to buy or sell an asset like gold at a certain price for a definite amount of time. What’s great about futures is that the maximum risk associated with buying them is usually just the premium you paid to enter the contract.

As the world continues to live through a global health crisis, betting on gold becomes an even more enticing investment decision. To make the most out of the great run this precious metal has been having, consider buying gold as early as today. For articles concerning gold and other investment options, be sure to explore our site.