Investing in gold is a viable way to increase your income streams. After all, you just need to buy the precious metal and wait for its value to rise over time. On the other hand, you can also opt to trade gold and take advantage of the short-term surges in the market.
This investment type has always been popular. That’s why you won’t have a difficult time finding platforms where you can buy gold and other precious metals. The Oxford Gold Group has a wide collection of gold as well as silver, platinum, and palladium coins.
However, one of the reasons holding most people back from investing in this precious metal is that it requires substantial capital. Gold bullions and coins come with a hefty price tag, which can be overwhelming for the newbie investor.
Fortunately, there are affordable ways to invest in gold, such as:
- Exchange-Traded Funds
The most cost-friendly method to investing in gold is through exchange-traded funds (ETFs). This setup works similarly to a mutual fund in that it pools the resources of different investors. The funds are then used to purchase the commodity. Think of this as gold stocks that you share with other investors, and you earn a dividend.
ETFs offer more liquidity, which is one of the top buying tips you should remember when choosing your investments. Liquidity is useful during emergencies when you need access to the funds immediately. Additionally, ETFs also provide a level of diversification, unlike investing in single stocks.
- Mining Company Stocks
Unlike ETFs, which can be likened to sharing gold with other investors, you don’t directly own gold when you invest in mining company stocks. Instead, you’re a part-owner of the enterprise that mines the precious metal. The cost of the stocks is still influenced by the price of gold, which is how this investment type allows you to capitalize on gold’s value.
- Gold-Content Coins
If you really want direct ownership of physical gold, the most affordable way to do that is to purchase bullions or coins according to their gold content. Always be aware of how much gold is in a bar or coins, especially with collectibles. The prices of collector’s items typically depend on their perceived or historical value, not as much on the actual gold content in them.
Knowing this, you should make sure to purchase bullions, coins, or bars with high gold content. This way, you’re assured that your investment’s value will go up along with the price of gold.
Be careful about buying jewelry, though, as its initial price might’ve had a hefty markup. If this is the case, you might not be able to resell it in the value that you want. Appraising jewelry can also be complicated, so save yourself the trouble and focus on coins and bars. You should note as well that you’ll still need to think about storage and insurance to protect your assets.
Gold is often seen as an expensive investment. However, ETFs and stock exchanges have allowed investors to capitalize on the precious metal without having to spend a huge amount all at once. If you really want direct ownership of gold, though, you should be mindful of its content so that you can get significant returns when you decide to sell it.