For thousands of years Gold has been used as currency and been a highly prized precious metal. It has been used in jewelry since as early as 5000 BC by the Varna Civilization. Gold and other precious metals are a favored investment to hedge your portfolio against inflation, and to be an emergency fund should the stock market crash.
Gold prices in the international gold market can remain fairly stable through times of instability, recession and currency fluctuations.
Their are various ways to invest in gold can be via purchasing physical gold bullion in the form of gold bars or gold rounds, minted gold coins.
The relatively stable price of gold can help insure your investment portfolio against economic instability. Gold bullion prices may fluctuate over the years but gold investments are highly unlikely to get devalued and have performed well over recent years.
Gold coins have a legal tender face value in the countries currency that they were minted, and can be easier to dispose of if you need to liquidate your gold assets. Many types of gold bullion rounds or gold coins are available, such as American Eagles, Krugerrands, Sovereigns, Canadian Maples, Australian Gold Nuggets, Chinese Gold Pandas and many more. Gold bullion bars are available in many different sizes up to 400 ounce size. The 400 oz bullion gold bar is the London Good Delivery bar size. Good delivery bars must meet certain specifications, they must weigh between 350oz – 430oz and be of a minimum purity of 99.5% pure Gold. These London Good Delivery bullion bars are normally held by central banks and not usually held by smaller private investors.
The most cost effective way to invest in physical gold is to buy larger bullion bars. Gold bullion in bar form offers the lowest gold dealers percentage over the gold market price, depending on the bars size the dealers premium over fix can be as low as 2% – 5%. Compared to the premium on various gold coins of between 7% – 20% or more gold bullion bars appear much more attractive financially. Although the fact that gold bullion rounds or coins are much more liquid than bars may sway your decision to purchase bars. Gold coins can be disposed of on the open market fairly easily and quickly in comparison to large gold bars. Coins are also much easier for the smaller investor or private individual to obtain and to store. There is also the collectible and historical value that gold coins have against gold bullion bars.
Silver is an exceptional investment. It is a lot cheaper than gold, and holds its value equally as well. Silver has been used in coin mintage more than gold.
It is also a hard asset and doesn’t have any third party risk. You do not need a third party to cash you out like you do with stocks and bonds. There is also little risk since there is no risk of defaulting (like there is with stocks when a company goes bankrupt.
Silver is also easier to sell and buy since it is roughly 1/70th the cost of gold.
Silver also has an industrial application, and is used in electronics and the semiconductor field.