Comments Off on The Fears, Facts, and Flaws of Buying Gold
Sometimes investors wonder whether investing in gold would hold a great promise for them. Well, studies have shown that gold can be a great investment. Moreover, when one buy gold Canada it can be a great storehouse of wealth and provide great security in times of financial crisis.
In this blog, you will learn about the popular ways to invest in gold. Check out below:
1. Bullion Funds
You can opt for mutual funds or ETFs which can be exchanged for gold. The value of these assets can be easily tracked depending on the price of the underlying gold and annual management expenses.
Customers apart from buy gold Canada can easily purchase and sell mutual funds on a daily basis. ETF’s can be traded like stocks in the stock market. However, for trading ETFs, one would need to pay broker fees.
Fear: When a fund provider goes down, the money and gold will vanish.
Fact: Just make sure of the fact that the underlying gold in the fund is allotted to the investors and not the bank storing it.
Flaw: However, if anything goes wrong with the fund, it is for the gold and not the creditors. Similarly, not all bullion funds invest in physical gold. It invests in gold-mining equity.
2. Gold Bars and Coins
For many investors, going for physical gold is a better option. They know it very well that if they buy gold Canada its value would increase over the coming years; even if the economy is facing any crisis.
Fear: Many investors fear to store gold as it’s risky and complicated
Fact: One can store their gold in the registered and insured vaults of banks at a certain cost. However, before storing gold, it’s important to get it covered by home insurance. Also, owning large gold bars don’t come with a guarantee of gold’s purity.
Flaw: The coins or bars come with a 5% premium over the gold price. The price also includes sales tax, insurance cost, and commission of dealers. However, reputed dealers before buying gold ask for proper ownership documents.
3. Gold Certificates
Investors can purchase gold certificates from banks. The certificates can be exchanged for physical metal held in the vault of the banks or for equal cash.
Fear: the certifications may not be of any worth in case thefinancial systems or banks fail.
Fact: Certificate issuers after becoming broke left many certificate holders with nothing. Being a promissory note, one won’t be able to own the gold.
Flaw: Sometimes big banks can go bankrupt. Go for something more concretes, in case you plan to buy gold Canada for remaining protected against financial uncertainties.
4. Gold Futures
Without owning the metal if one loves to play with the fluctuating gold price rate, one should go for futures. Future holders promise to purchase gold on the expiry date. however, one can easily sell it before the contract expires.
Fear: Pop retail investors can’t be a part of the future market.
Fact: Retail focused brokers can invest in gold futures at a little cost.
Flaw: For a margin purchase, small investors get exposed to a lot of debts. Panic in the market can create counter party risks.
These are some common fears, facts, and flaws associated with buy gold Canada services. Hopefully, after going through the facts, one would be able to make an informed decision.
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