Different options to invest in gold


20 Nov

Gold, being a rare commodity, has no guarantee of availability. Consequently, you need to find that gold trader who has enough networks and understanding of the market such that he or she can guarantee you of steady supply and on-time delivery as you would expect. To be assured, you need the gold trader to give you proof and undertaking of a consistent supply.

You should try to always deal with gold dealers who are known to be reliable, trustworthy, honest in their dealings and reputable. By dealing with reputable dealers, you can avoid many pitfalls and headaches. Before you sell off, you should also do a little homework in trying to find out the current gold value in the market so that you know whether you are getting a good deal for your old jewelry or not.

Other than physical gold, one has the other option of investing in gold equivalents. Gold equivalents are simply papering whose value either directly represent an equivalent value of gold or simply stocks of a gold mining company. Common gold equivalents are ETFS. Generally, the following are gold investment options-

•             Direct ownership of vaulted gold

•             Gold Exchange Traded Funds (Gold ETFs)

•             Gold Mutual Funds

•             Junior Gold Stocks

•             Gold Options and Futures

Some other options available for investing in gold are discussed below-

Warrants

Warrants are instruments that give the buyer a right to purchase gold at a predetermined date for a specific price. The buyer must, however, pay a premium to guarantee his participation.

Gold Accounts

The two categories of gold accounts are known as allocated and unallocated. The former is used by investors to store their weighed and marked gold for which they pay storage and insurance. The owner has full ownership afterward. On the other hand, the unallocated gold account does not give full ownership to the owner since the coins are not marked and paid for either.

Gold Accumulation Plans

This is simply described as savings that allow you to buy gold with the amount that has accumulated in your account after every month. In the event the investor closes his/her account, the gold is given to them.

Gold Mining Stocks

Having stocks in the gold mining sector can be financially rewarding especially because the stock prices are determined by the price of gold.

Gold Certificates

These certificates were initially bought from the US Treasury using dollars. The investors later exchanged them for gold of equal value.

Gold Orientated Funds

This refers to funds invested in different sectors that give returns from companies dealing with gold. They may be gold mines or mineral mining companies.

So, these are some options to invest in gold.

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