If you have an interest in adding gold investments to your investment portfolio, then it’s time to decide how you should invest in gold. There happens to be more than one way of investing in gold in Australia. Here in this article we’ll discuss four ways in which you can invest in gold and add value to your investment portfolio.
1- Gold Bullion
The easiest way of buying gold bullion is to buy it directly from a local mint, like the Perth Mint in Australia, or from a gold trading company. The advantage of buying gold bullion from the Perth Mint is that you can store your gold in a vault that is provided to you by them. Doing so is absolutely safe because the Perth Mint is owned and guaranteed by the State Government of Western Australia. It’s best to buy gold bullion because the bullion has the advantage of being in a perfect correlation to the market price of gold. Moreover, the bullions are highly liquid and you can easily sell them. However, there is some cost of investing in gold bullion which includes transaction, storage and insurance cost.
2- Gold Coins
There are two types of gold coins – regular bullion coins and collector coins. People who are mostly interested in buying physical gold will buy bullion coins. The advantage of buying bullion coins is that you can buy them from the USA, Canada or Australia, but the intrinsic value of gold will remain the same. An alternative to bullion coin is a collector coin. These are also called numismatic coins. Such coins are traded at a considerable premium depending on the intrinsic value of the gold coin. Both types of coins are sold at the Perth Mint.
3- Exchange Traded Funds
Exchange Traded Funds (ETFs) are perhaps the most recommended way of investing in gold. ETFs are mostly known as a form of an index fund that is traded on the stock exchanges. There are ETFs or ETCs (Exchange Traded Commodities) that can track the price of gold by directly investing using sites like Gold Bullion Australia. ETFs and ETCs are attractive because you don’t have to buy and store gold physically. That’s why there are no insurance costs involved, and you have the advantage of buying and selling your ETFs and ETCs on the Australian or international sharemarkets.
4- Shares in Gold Producers
Buying shares in gold producers, like Newcrest Mining and Newmont Mining is another alternative to investing in gold. But your investment in these shares gives a rise to some new equity risks. Every company has a unique risk profile that you must consider before you invest in their shares. These risks may include political conditions of the countries they operate in, their operating costs, the number of gold mines they have in the world, and the amount of debt that they carry.
Considering these four easy ways of investing in gold in Australia, you can make your investment portfolio more diverse and make it look more impressive than before.