Gold has fascinated humanity since the dawn of time – it is a precious metal that has been identified with power and wealth for centuries, and its shine does not fade even after 1000 years from digging up. No wonder that currently investing in gold is one of the most popular forms of capital investment, which provides security for your savings in the long term. Investing in gold is a popular way to protect your funds from inflation and instability in the financial markets. Is it worth investing in gold and how to go about it? When is it worth investing in gold? Which products to choose? Bullion bars or coins? You will find the answers to these and many other questions in this article, in which we discuss in detail the pros and cons of investing in gold, as well as provide useful tips that will allow you to start your adventure with this metal.
Investing in gold – what should you know at the beginning?
Investing in gold is commonly treated as a hedge in periods of economic uncertainty – it protects capital against inflation and is an excellent form of portfolio insurance. Investments in gold include both physical gold (i.e. gold bars and gold coins) and virtual gold (ETFs, futures, shares of mining companies), which allows you to choose a solution tailored to the individual needs of a given investor. There are many entities available on the market that allow you to invest in gold – it is worth choosing reputable dealers with many years of experience, who only offer coins and bars physically available in their warehouses at the time of purchase.
Why invest in gold?
Why invest in gold? An investment in gold – like in other investment metals – is treated by many investors as a long-term security of wealth. One of the main reasons why it is worth investing in gold is gold’s ability to hedge savings against inflation in the long term, i.e. 5, 10 or even 20 years – when the purchasing power of money decreases, the value of gold generally increases. At the same time, investment gold is widely considered to be a stable investment in times of all kinds of political and economic crises. The price of gold is definitely more stable than the stock market, which means that many investors treat this metal as a “safe haven” in periods of economic uncertainty. It is also important that investment gold is characterized by a low correlation with other assets, which means that its value remains stable even when other investments lose value. All this makes investment gold an invaluable component of a properly diversified investment portfolio, and the purchase of gold should be considered by any investor who is aware of the unpredictability of the modern monetary system.
How to invest in gold? Ways to invest in gold
You can invest in gold in several ways, choosing either gold coins and bars or paper gold. Investing in gold can therefore take various forms depending on the individual needs and financial capabilities of investors. The most popular solutions are gold bars and bullion coins, which are available in various weights and therefore prices. Gold bars are available in many variants – from small bars, i.e. weighing 0.25 grams, to those weighing 1 kilogram. The same is true for coins, with the most popular coins being those weighing 1 troy ounce. According to what we mentioned earlier, investment gold is not only coins and bars, but also the so-called “paper gold”. What is hidden under this rather unintuitive name? Investment gold in paper form includes various financial instruments, such as ETFs, futures, or shares of mining companies. Investing in paper gold is primarily a solution for investors open to greater risk who plan to invest in the short term and make money on the change in the price of this metal. It is worth investing in gold in various forms to maximize the benefits of this investment – regardless of the form, investment gold is an excellent capital hedge and is a valuable addition to almost any investment portfolio.
How to start investing in gold?
Investing in gold is not as difficult as it may seem. Undoubtedly, every investor at the beginning of their journey wondered how to start investing in gold, whether it is profitable to invest in gold, whether gold is a good investment, what gold is best to invest in, when to invest in gold – how to go about it at all? What is worth mentioning at the very beginning is the fact that physical investment gold, i.e. gold coins and bars, is exempt from VAT, as well as – if the appropriate conditions are met – also from VAT. You can find more about investing in gold in the context of taxes in a dedicated article: “Gold and taxes”. It is best to start investing in gold by buying physical bullion, choosing gold bars and/or bullion coins. Investment gold is one of those assets that can be owned in physical form, which is undoubtedly its advantage in the context of the insurance role of this metal. Why not take advantage of it? At the same time, investing in physical gold is very simple, and in the case of the long term, the most important rule is simply “buy and hold” – you don’t have to constantly monitor the charts and keep your finger on the pulse. The key aspect here is the place to buy gold – it is worth choosing a trusted dealer who will ensure the security of the transaction and provide professional advice on the choice of products with a specific budget.
Investment in gold – gold coins and gold bars
To be sure of the quality of the bullion and at the same time maintain high liquidity, it is best to decide to invest in gold coins and bars, the production of which is the responsibility of the world’s most reputable mints. Thanks to this, when we resell it later, we will be able to count on a better price of gold. What speaks for investing in gold bullion coins and bars is the physical possibility of owning this metal and the associated zero or very low service costs – coins and bars can be easily stored, for example, in a home safe or other place inaccessible to third parties. At the same time, both an investment in gold bars and an investment in gold bullion coins are an excellent solution for investors who are particularly sensitive to the beauty of gold bullion.
Is it profitable to invest in gold jewelry?
Is gold jewelry a good investment? A wide range of products issued for strictly investment purposes, such as gold coins and bars, makes investing in gold jewelry pointless. This is primarily due to the fact that gold jewelry represents primarily aesthetic values, and the price for 1 gram of gold is generally higher than in the case of products issued with investment in mind. At the same time, it is rare that gold jewelry is produced from bullion of very high or highest purity, which further questions the sense of investing capital in it.