What is in store for potential gold investors during the remaining months of 2015 and the following year?
Stocks thrived while bonds have become profitable. On the other hand, gold and crude oil have been declining.
This leads interested gold investors to think and ask: Why should I invest on this precious metal?
Perhaps, the basic argument is expansion or branching out can be the key to lucrative and long-term investments.
Prices of gold and stock are not related directly. Therefore, you have the option to own an asset that increases in value even as the other one decreases. Right now, the USD is relatively strong compared to other major currencies including the EUR and JPY. While the dollar surged forward, gold declined. In the event there is a reversal, investors are expected to go for safe-haven gold.
Investors possess diverse time perspectives and tolerance for risks. You need to decide possibly with the help of a financial coach if this is the right time to include gold in your investment portfolio. Some investors wait before acquiring an asset until pricing moves from even to positive or negative.
It is also possible that exchange traded funds or ETFs are a better option than physical gold. The yearly expense ratio is lower compared to gold that you need to store preferably in safety deposit boxes for security reasons. Besides, you can sell ETFs easily like stocks instead of finding a trustworthy buyer for the precious metal.
Gold mutual funds are alternatives for investors who are tentative to put their money in gold but still want experience with this prized metal. Said funds possess portfolios of gold reserves courtesy of companies that quarry for gold. Investors opt for these firms as a precaution rather than obtain shares in new companies.
Junior gold stocks can also be alternatives for potential investors although this stock level is more temporary. These are less prone to be productive and more of exploratory. It has high prospective profits but greater possibility of loss. Capitalization is comparatively smaller compared to senior gold stocks. Said investments are good for investors who are more open-minded about the hazards of this option.
Experienced investors choose the gold options market. This enables you to speculate on prices of gold in both directions. This is complicated and more investors have the tendency to lose than win. You control huge investments with small amounts of money but options run out within certain duration.
Find out all about possible hidden charges such as taxes which are higher than other types of investments. These are often classified as collectibles and not equities. It means that you have to pay as much as 13 percent more. Expect fees for storage, commissions and transactions. Do not advance more than 10 percent of your money initially especially if you are not familiar with this trade. The amount should also depend on your economic capability. Consider shipping costs as well. Coins are lighter than ingots so it may be more cost-effective if you opt for gold coins. It is expensive to ship bars to dealers due to their weight. Select coins that are popular in the market instead of unique varieties which are more difficult to sell.