When planning for your financial future, it’s important to always look at the different options on the table. These days, one of the most sought methods to putting your money to work for you, is investing in gold. Investing in gold provides individuals with a residual income that is easy to start and maintain. There are three main types of gold investments including physical gold, gold miner stocks, and gold ETFs stocks.
Each of these methods has their own Pros and Cons, based on risk, cost, involvement, and investment level… so we will focus on each of these key points for the three investment methods below.
Physical gold is the standard in terms of gold investments. Many people choose to invest in physical gold because it is a secure and stable investment and can easily be accounted for. It can also be used for various retirement funds such as an IRA or SIPP. At the end of the day, there is not much of a threat with physical gold in terms of inflation prices going up or down. This is not the case with gold miner stocks or gold ETFs stocks. If you are going to invest in physical gold, it’s important to go with a reliable seller that has a longstanding history in the industry. To see the current price of gold, you can visit a site like GSI Exchange, which has an active ticker for both gold and silver — while also offering options for purchasing gold coins and bullion as well.
Gold Mining Stocks
Gold Miner stocks are now becoming the choice investment for many people who are looking for a way to make residual income that can appreciate like a traditional stock. Gold miner stocks react quickly to the constantly changing value of gold, so you might see one number one minute and then you might see it change rapidly. The secret with investing in gold miner stocks is to keep note and watch the ever-changing trends and numbers that pertain to these investments. Gold miner stocks offer a good probability of making a high return, but they also have the tendency to provide great losses as well. Depending on which miner stocks you are investing in, there is always a chance for a quick and fast return if a company hits a new fresh mine with of metals, or is acquired by another. You can see some of the most active gold miner stocks for 2017 here.
Gold ETFs Stocks
Gold ETFs Stocks are mutual funds invested in gold miner stocks. The problem with these types of gold stocks is that they have capital gains taxes associated with them which can cost unnecessary money that is not present in gold miner stocks or physical gold. It’s important to take note of these capital gains taxes when choosing the particular gold ETFs stocks to invest in. A few of the most popular gold ETFs are at the Direxion 3X ETFs, which have much more risk involved, but also move at a pace of three times the daily movement of gold miner related stocks. Since these ETFs are made up of gold miner stocks, it means they can move up and down with movements in the stock market and don’t correlate directly to the price of gold itself.
When investing in gold, you are likely going to be looking at a long-term investment strategy. Since gold is a world currency and changing at all times, it usually won’t drastically change like individual stocks or yield massive gains. However, in times of world turmoil or financial struggle, gold can become a safe haven for investors around the world. Over the past 20 years, the price of gold has scaled between $800 to $1900 an oz. Now the only question is… where will gold end up within the next few years and is it a good investment at its current levels?