5 Facts To Know Before Investing In Physical Precious Metals

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5 Facts To Know Before Investing In Physical Precious Metals

The three major valuable metals that trade around the world are platinum, gold, and silver. There is only a limited amount of these minerals available to humankind. Their extraction is rare and difficult. But, more difficult is the process to mould these precious yet delicate metals into usable solids. All this combined with their supply shortage is the explanation behind their worth.  Here are 5 facts to know before investing in physical precious metals.

Gold enjoys mass popularity as an excellent investment. Silver is the cheapest of the three. Platinum, being the rarest and the most difficult to mine, is lesser heard of.

The biggest and most direct advantage of investing money in precious metals is the assurance that comes with them. Even in tough economic times or worldwide recession too, gold would always be a tradable asset. 

Although gold does have its special place, other precious metals too never fail to provide a safety blanket during financial crunches. 

However, before you take the big step of investing in precious metals, we thought you might want to know 5 interesting and useful facts about precious metals. Here they are, read on:

1) Where you buy it from matters the most!

Jewellers have a reputation of stealing a few grams off the coin. Just a few grams from your gold coin has the potential of causing a difference of $100 and more! Why lose a significant chunk of money on your investment. You could choose to buy gold or silver coins from a bank. However, banks are known to charge higher taxes and they sell the metal at a higher price too. It is thus recommended that you buy precious metals from trusted companies such as Auctus Minerals, who not only assure genuinely but also the best prices in the market. 

2) The best time to buy:

Market advisors would tell you the best time to invest in mutual funds and equities is when they aren’t performing well. When their prices are low, you would see most investors panicking and withdrawing off from the funds. However, with precious metals, there is no panic. 

Everyone knows that precious metals will eventually have a great resale value. But the right time to invest in precious metals too is when they are on a low. If you buy a gold coin when gold is surging high, you wouldn’t make as much profit when you resale it later. However, if you bought it when the market seemed shaky and gold prices were dropping, you would obviously have a bigger margin while reselling. 

3) Having gold/silver bonds is not the same as having the metal

Although you could invest in precious metals in various ways, they are not all the same. It is one thing to have the metal in hand and another to invest in it via Electronically Traded Funds (ETFs) or Mining stocks. You see, when you invest via schemes, you still own the metal but aren’t safe from the market’s fluctuations. In the case of mining stocks, you would still be vulnerable to the stock market fluctuations, even if your metal’s price doesn’t drop. In the case of ETFs, your bond papers won’t have much significance in case the market goes through a recession.

4) How to keep precious metals physically?

So if we are to go by the preceding point, it is best to have your precious metals in their physical state. However, that’s not a simple task. Owning a precious metal in hand has a lot of risks on its own. Misplacing the tiny coins or losing them to a burglar could bring your investment down to zero in no time. Thus, if you choose to keep your assets in the physical category, you should have a secret vault in place or a bank locker, basically a hide-out where your precious investments could be hidden and safe.

5) The quality of your investment

Last but not least, not all gold or silver is good for investment. While you could make jewellery out of even 18k gold, it doesn’t yield much as an investment. 

So, if your sole purpose of having a gold bullion or silver coin is to help your money grow, then do not invest in gold lesser than 22k. As for silver, anything below .999 fine is a bad investment. We hope this article has helped you understand precious metal investments better. 

Featured Photo by Pineapple Supply Co. on Unsplash
Craig Evans

Hi, my name is Craig Evans. I am a finance fanatic and tech junkie based in Sydney, I frequently write articles related to Business & Marketing and am expanding my niche of writing by experimenting with different content.

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