There are currently 9 known precious metals but only Gold, silver, platinum, and palladium are considered investment commodities. Of the 4 gold is definitely the most popular among investors and for good reason. Gold is known world wide since its really the original currency, in fact paper currency was originally simply a promise to pay the bearer in gold. These days investing in gold is a popular way of protecting ones assets against recessions and even national and international crises. Lets face it if the world started over tomorrow after a major catastrophe and there was only 1 society gold would be the common currency as it was up until the 1800s. Below is a list and brief description of the most popular ways to add gold investments to your portfolio this site.
Buying gold coins is currently the most popular way of investing in gold. Gold bullion coins are generally priced based on their weight HOWEVER a premium is always added to the current price of gold. Gold coins may be bought or sold over the counter in most Swiss banks, also by special order is many other banks. You can also buy over the internet or from local coin dealers.
Buying gold bullion bars is the most traditional way of investing in gold and as with Gold coins they can be purchased or sold over the counter in most Swiss banks, also by special order is many other banks worldwide. You can also buy over the internet or from local dealers in most cases. Gold bars are becoming less popular option for investors because of difficulties such as the verification process, transportation, and storage associated with owning gold bars. They still are my personal favorite and tend to have less of a premium then gold coins.
With a gold account, gold can be bought or sold in a very similar way that foreign currencies are traded. A gold account is backed either through NON fungible (allocated) gold storage or pooled (unallocated) storage. You may even able to get leverage when buying gold however this can be risky but like anything else gold does go up and down, if you take to much leverage you may end up having to pay more money on a margin call or risk having your gold sold at a loss to you. If you use leverage you should treat the entire amount as the investment not only what you put up just in case gold happens to go through a corrective stage and temporarily dips.
Another popular choice among investors is to invest in a gold certificate rather than buy physical gold bullion which then has to be stored and/or insured to protect against theft and other such incidents. A gold certificate allows the investor to buy and sell the commodity and eliminate the difficulties associated with owning actual gold. The downside is that you never really have the access to the physical gold.
Gold exchange traded funds (knows and referred to as GETFs) are open ended funds that present a cost efficient and secure way to invest in gold without the necessity of taking physical delivery of gold bullion. Trading GETFs is similar to trading shares in any of the worlds stock exchanges such as the Dow Jones Industrial in New York. Trading in GETFs involves payment of commission and storage fees which are charged on an annual basis. The expenses incurred in relation to the handling of the fund are charged through the selling of a certain amount of the gold as represented by the certificate. Over time, the amount of gold in the certificate decreases to cover these costs with the hope of course the price of gold itself has increased therefore making the certificate worth more then the original investment.