How To Buy Gold

People often compare the best in any domain with gold; so it's no wonder people want to know “How To Buy Gold” in the best way possible. For example, if you visit a premium spa and have a wonderful experience, you say that the services are “gold standard.” Data is also referred to as the “digital gold” of the times we live in. This is the reputation and positioning gold has acquired with time!

The metal has been considered precious for centuries. From making coins and bars to crafting beautiful designer jewelry, gold has maintained its value. A look at the gold spot prices over the last few years will show you the growth in the metal’s value. This value keeps increasing even during times of economic uncertainties, making gold a successful hedge against inflation.

If you know how to buy gold and choose the best way to invest in the metal, you can make impressive returns in the long run. Whichever form you buy gold in, it will cater to your financial needs during rainy days. You can buy the precious metal for long-term and short-term purposes, depending on your requirements and the asset’s liquidity.

Before moving ahead, have a glimpse of the topics this blog discusses to help you explore how to buy gold:

If you are ready to invest in this beautiful and profitable precious metal, the most important question arises: How do I buy gold?

     How Do I Buy Gold?

If you are new to this domain, you will find yourself asking this question quite often as it is a strategic investment. Knowing how to buy gold gives you a sense of direction and helps you choose the best form of this metal to invest in.

People often assume that investing in gold requires you to spend thousands of dollars. This is certainly not the case. You can start your investment journey even by purchasing one gram of gold. As long as you engage with authentic dealers and know how to buy gold from different sources, you should be well off.

Let us explore the question, “How do I buy gold?” further and give you the most common and popular options available for you to invest in the precious metal.

     Types of Gold Investments and How to Invest

1. Physical Gold

Gold Bullion (Coins and Bars)

Even if you have no idea how to buy gold, you must be familiar with this mode of purchase. A large chunk of gold buyers invest in bullion products like coins and bars(ingots/bricks).

Gold bullion refers to any form of physical gold that contains more than 99.5% pure gold. You can invest in gold bullion by purchasing coins, bars, or ingots. Refineries and Mints worldwide produce beautiful and pure bullion gold products with metal content as high as 99.99% fine gold.

Gold Jewelry

A short answer to the question, “How do I buy gold” can also be buying gold jewelry. High investment value and purity of the metal have led to an entire industry manufacturing and selling gold jewelry to help buyers make simple investments. Unlike many other physical gold products, gold jewelry also acts as a status symbol in societies, plus heirloom for generations.

Buying Physical Gold from Dealers

If you want to ensure a seamless purchase of physical gold products, you should engage with an authentic dealer. While a simple Google search will give you the most reliable gold dealers near you, it is important to assess the available options.

In the age of digitization, you can buy physical gold from trusted online dealers. These professionals run online ventures that help you make quick and cost-effective purchases.

When you approach a bullion gold dealer, they will sell you physical gold at some premium; premium refers to the difference between the current gold spot price and the price at which you buy a bullion gold product.

Before approaching any gold dealer (online or otherwise), ensure that you are paying an optimum premium and getting the best deal. It is also important to buy these precious assets from trusted dealers. Have a good look at a dealer’s official website, check ratings on reliable platforms like Trustpilot and Google, and have a look at customer reviews/ratings before approaching them.

2. Gold ETFs and Mutual Funds

If you are wondering how to buy gold in an intangible form, you can invest in ETFs and/or mutual funds.

ETFs refer to exchange-traded funds. They prevent investors from carrying and storing physical gold. The easiest way to understand ETFs is by comparing them with the shares of a company. When you buy ETFs, you own shares representing gold instead of owning a part of a company. If the gold spot price increases, you can sell your ETFs and make a profit from the same. Such investment vehicles give you the benefits of investing in gold without the presence of physical assets.

Many investors, especially beginners, also invest in gold mutual funds. Here, every mutual fund share represents a specific weight of gold. For example, you can purchase a share representing 1/10 troy ounce of gold. The rise and fall in gold prices will impact your share, letting you make profits from these investments.

If you want to know how to invest in gold ETFs and mutual funds, the process is quite similar to buying shares of a company. You can open a brokerage account or go on trusted stock trading apps that sell these assets to users. Many banking applications also have options for making such investments with a few simple taps.

3. Gold Futures and Options

Gold futures and options are other common ways of investing in intangible gold. It involves purchasing options contracts in anticipation of the gold prices increasing in the future.

If you believe that the gold spot prices will increase over a period, you can purchase an options or futures contract whose underlying asset is gold. If the prices increase according to your prediction, you can sell these contracts and make profits. If the prices fall, you lose money.

If you are wondering how to trade gold options, you will need a brokerage account to conduct transactions. Get in touch with a trusted and experienced broker or trader before buying gold this way.

4. Gold Mining Stocks

This mode of investing in gold involves investing in a company. Here, you buy stocks of a company that mines gold. Investors prefer such methods as gold mining companies often make handsome profits and provide precious metals to multiple industries.

If you know how to invest in a company’s shares, you know how to buy gold mining stocks or shares. Choose the kind of company you want to invest in. You can buy gold mining stocks from two kinds of companies – major and junior. Typically, minor gold mining stocks are riskier than the major ones due to the nature of the corporations. Work with experienced professionals to choose suitable gold mining stocks that give you substantial returns.

     Pros and Cons of Different Gold Investments

We hope we have answered your question, “How do I buy gold?” with the different investment methods discussed above. Ultimately, it is your choice to pick the most suitable way of buying gold.

Let us compare these gold investments and dive deeper into their pros and cons.

1. Physical Gold:

Pros	Cons
1. A Tangible Investment When you invest in physical gold, you can touch, feel, and carry the assets you purchase. This adds to the aesthetic appeal of your investment portfolio.	1. Storage Considerations You will need to find a safe space to store all your physical gold assets. Especially if you are buying heavy bullion gold bars, carrying and storing them needs special attention.
2. Hedge Against Inflation Unlike intangible investment options like bonds and stocks, physical gold acts as a hedge against inflation.	2. Additional Costs While buying physical gold products, you may find yourself incurring additional costs, including dealer’s fees, premiums, storage expenses, and more.
3. Privacy You can purchase bullion gold and gold jewelry without leaving a digital trail. Such transactions ensure security and privacy.
4. Easy Buying and Selling Especially if you buy physical gold from a globally renowned refinery or Mint, you can easily buy and sell your assets.

2. Gold ETFs and Mutual Funds:

Pros	Cons
1. Quick Cash Outs Just like the stocks of a company, you can trade gold ETFs and mutual funds easily, leading to quicker cashouts.	1. Nothing More than a Document ETFs and mutual funds do not allow you to buy a gold product you can touch. At the end of the day, it is just a bunch of documents!
2. No Security Issues Being intangible and already secured, you do not need to worry about keeping your gold investment safe.	2. Management Fees You may find yourself paying hefty management fees that eat into your investment returns.
3. Spreading Out The Risk Along with gold, investment vehicles like mutual funds and ETFs give you access to other assets, often on the same platform.	3. Stock Market Influence The value of these investments is not just determined by the ongoing gold spot prices. The stock market also has a direct influence on your profits or losses.
4. Easy Investment If you already have a brokerage account, you can easily invest in such gold assets without much assessment and speculation.

3. Gold Futures and Options:

Pros	Cons
1. Chances of High Returns If you make accurate predictions and the market conditions are favorable to you in the future, you can make quite a lot of money with gold futures and options.	1. Risky Investment These investment options involve speculations and predictions, putting you at risk of making significant losses.
2. Small Initial Investment Unlike most other investment alternatives, you can control a large portion of gold by making a small initial investment.	2. Difficult to Understand If you are new to this domain, buying and trading gold futures and options can get confusing.
3. High Flexibility After making an initial investment, you can bet on the gold prices going up or down over a specific period.	3. Constant Monitoring You cannot relax after investing in gold options or futures. Such investments demand constant monitoring and management.
4. No Storage Concerns As you deal with contracts and no physical gold, you need not worry about storing your gold investment safely.

4. Gold Mining Stocks:

Pros	Cons
1. Scope for Growth If the gold mining company you invest in turns out to be a dark horse and does well, you can earn impressive returns on your investment.	1. Volatile Investment Investing in gold mining stocks is often volatile as the stock prices move up and down fiercely.
2. Impact of Gold Prices Without Physical Gold When you buy gold mining stocks, you can directly benefit from the rising gold spot prices without having bullion gold products.	2. Company-Specific Risks You may end up losing money for reasons that have nothing to do with the ongoing gold prices, such as mining accidents, poor company management, and more.
3. Ideal for a Bull Market Such investments work best in a bull market. Under such a setting, your gold mining stocks can rise even faster than the gold spot prices.