Archive for September, 2012

6 Reasons to Invest in Gold

September 27th, 2012 1 comment

If you’re looking for a good return on your investment, buy gold. Why? Because gold has a strong history in preserving value even when national currencies were losing value. If the value of your current investments is being determined by depreciating currencies then it may be a good time for you to start thinking about investing in gold.

Wondering where you fit in when it comes to the ‘type’ of people who have decided to take their hard-earned money and invest it in gold? They are the people you meet in your everyday life, i.e. doctors, carpenters, teachers, and bank tellers. In fact, the next time you see your next door neighbour, ask them if they happen to be a gold investor. You just may be surprised at their answer. What we’re saying is that anyone who has an interest in investing in the gold market can become a gold investor.

6 Reasons to Invest in Gold

The following are 6 reasons why it’s a good idea to invest in gold:

1. Gold utilisation is not keeping up with global gold production. This means the price of gold is going to continue to rise as demand increases.

2. Gold is a universal form of currency. For instance, the US dollar is currently weak with no apparent end in sight due to existing economic policies. Investing in gold is a great way to increase the value of your portfolio because it is much more stable than national currencies.

3. Gold is a form of insurance, and can be separated from most capital assets that rely on someone else’s ability to pay.

4. It’s not difficult to buy or sell gold. In fact, gold can be seen as somewhat of a portable investment that you can buy and/or sell whenever you want.

5. There are lots of choices when it comes to buying gold. There are gold bars, gold coins, gold stocks, gold bullion, gold mining, etc. from which to choose from. It’s important that you recognize there are pros and cons to buying each form of gold, so be sure to do your homework so you can fully understand exactly what you’re buying.

6. Gold forms a properly diversified portfolio. At least 10% and no more than 30% of your portfolio should be comprised of hedge funds, making gold a great choice for creating a highly diversified portfolio.

How to Buy Gold in Australia: 9 Methods

September 18th, 2012 No comments

Buying gold is certainly a flexible process. Those who invest in gold also like the fact that there are so many methods to choose from when buying this precious metal. Since buying gold is a more and more popular choice for those who are looking for ways to invest their money, the choices for buying gold have increased greatly.

No longer are gold investors limited to only buying gold coins or gold bars (although these are still two of the more popular choices). Instead there are plenty of different methods that can be used to purchase gold, depending on your investment goals and strategy.

How to Buy Gold in Australia

The following are the top 9 methods one can choose from in order to invest in gold in Australia:

1. Gold Bullion – Refiners produce gold bars that range in weight from 1 gram to 400 ounces. Gold bullion is generally considered the most effective and least risky way to purchase gold.

2. Gold Coins -The American Eagle, the Canadian Maple Leaf, the South African Krugerrand and the Austrian Vienna Philharmonic comprise the most popular 1 ounce gold coins. Gold coin investment is also a highly effective way to invest in gold.

3. Numismatic Coins – If a coin is considered a collectible, the value of gold in these coins are at a premium. However, they can be harder to sell as collectors are the only buyers interested in paying the premium of a rare coin.

4. Gold Certificates – An extremely easy and convenient option, many people like the idea of owning certificates that state they own gold bullion. The actual gold is kept safe in a financial institution, of which there is a fee.

5. Gold Futures and Options – Since gold futures contracts are traded on future exchanges, high price movements are expected. These method also allow one to sell short, or to benefit from an increase in gold prices.

6. Gold Mining Stocks – This method refers to stock ownership of a company that’s traded in an exchange.

7. Jewellery – The most utilised gold buying method. Probably because buying gold jewellery normally requires a smaller investment. Especially popular in developing economies where people often use this method for savings.

8. Exchange Traded Funds (ETF) – This method requires shares to be purchased from a fund that’s only based on the current market price of gold. It’sconsidered the safest because it removes any leverage or storage problems.

9. Gold Mutual Funds – This is a fairly safe method that allows buyers to diversify their stocks and then let a professional investor make all the decisions.

Bottom Line

The choice to buy gold as an investment is a popular one. Especially since the value of gold has been steadily increasing over the past 10 years, making it of great interest to both old and new buyers. This interest has made it so that a variety of people are looking for a variety of ways to invest, and that’s why there are so many methods for buying gold these days. If you are interested in buying gold using one of the above methods, be sure to do your research first. This way you’ll have the knowledge to understand what methods are going to work best for you.

Is Silver A Better Investment Than Gold?

September 11th, 2012 No comments

Investing in bullion and precious metal has proven extremely lucrative in recent years, with the investment beating out almost every other vehicle in terms of yield.  Everyone has heard about the astronomical price that gold has risen to; but have you considered silver?  Which is the better between the two, in terms of investment potential?

Of course, no piece of investment advice applies to every situation, but you may want to keep these three considerations about silver in mind:

  1. Lower per unit cost

Since silver costs significantly less per ounce than gold, you can buy more of it for the same amount of capital investment.  This means that you can realize greater gains on your investment over the long term.  The price of silver is inherently volatile, so you have a lot of opportunity to take advantage of this with a low unit cost on the metal itself.

  1. Exciting new industrial uses spur demand

There have been all sorts of interesting new industrial applications for silver, which will spur demand for it for years to come.  It has the highest conductivity of any metal for both electrical current and thermal heat.  It also has the ability to kill bacteria without harming healthy cells, which has brought it into prominence for medical applications.

  1. Silver to gold ratio remains advantageous

Historically, based on the relative rarity of the two metals in the crust of the Earth, the price of gold should be approximately 16 or 17 times higher than the price of silver.  As of the writing of this article, gold is just over $1,600/oz., and silver is just over $30.00/oz (Note that prices will vary: Check out the latest spot prices here).  That is a ratio of over 55:1; so the shrewd investor can see silver is an incredible bargain currently.

Now, this isn’t to say that silver is always a superior investment to gold, because it isn’t.  Gold has a certain safety that silver doesn’t have, and the market certainly doesn’t have the same kind of volatility.  While silver can gain value extremely quickly, it does drop in value equally quickly at times; so you need to be aware of this if you decide to invest into silver. Generally, the best strategy is to diversify your investment into a range of metals, including both gold and silver.

Speak with a qualified investment professional to help provide you education on how best to invest your money into precious metals.  Make sure you take advantage of the great potential returns and relative safety of this fantastic investment instrument.