For those of you who don’t know, gold prices have gone up by 160% in USD over the last decade. Since 2015, the precious metal has appreciated by roughly 27%. At this point, the price of an ounce of gold is well above $1300. At the same time, experts predict the prices to go all the way up to $1500/oz in 2017.
Having said that, people are wondering what is the best way for an average person to invest in gold. Alpari gold knows the answer and is going to share it with us today.
Market Leader interviewed the Head of Alpari Gold. When asked about the best ways to purchase gold, he said the following:
The option to invest in gold is to buy fine gold , which is 999, and at a price close to the spot one. The closer, the better. When it comes to the best ways of doing so, most people think that jewelry is the simples and best one. That’s a delusion. To start with, you can rarely find fine gold in jewelry. To be more specific, you often buy 585 or 750 gold instead of 999.
Secondly, you pay the jewelers for their work. The fee is included in the price, which can reach as much as 50% of the price. By the way, that’s why you are offered a significantly less amount of money for the same jewelry if you want to sell it.
This leads us to believe that investing in jewelry is not the best idea. There are cheaper, more professional, and consequently less widespread alternatives. Some of them are gold bullions and coins.
When asked about the peculiarities of investing in bullions and coins, this is what he responded:
Both gold bullions and coins are made of fine gold 999.Both of them have bind and ask prices. This means that you can freely buy and sell them with banks and licensed private institutions at the corresponding market price. Basically, this is all that gold bullions and coins have in common.
Gold bullions have extra expenses, which makes gold coins a better investment. The thing is that bullions are taxable (for example, In Russia, the VAT is 18%). Secondly, the spread between the bid and ask prices on gold bullion is considerable, which means when you are going to be offered significantly less than you paid when buying the bullion. To be more specific, the spread my go up to 10% of the cost.
When it comes to gold coins, their cost is very close to the spot price of gold. Usually the difference varies from 4% to 8%. At the same time, coins are relatively small in size and therefore are more convenient to store. On top of that, they are light and therefore are affordable to almost anyone. This is a very important thing since few people can actually spare thousands of dollars to buy a gold bullion. And finally the spread between the bid and ask price is way tighter – 2%.
Which gold coins are the most popular ones with Alpari Gold investors?
The most popular gold coins are those of Austria, USA (2 coins), Australia, Canada, Great Britain, and South Africa. When it comes to their weight, they most popular ones are ½ ounce as well as 1 ounce. 1-ounce gold coins have been number 1 since you can save on fees charged by the mint and the vendor. With one coin you can buy over 31 grams of gold. Those coins enjoy international popularity. You can easily buy and sell them anywhere in the world.
At the same time, gold coins are safer to buy since they are harder and more expensive to counterfeit. Anyone can verify the coin with the help of a ruler and scales. You can check out the specifications of any coin with the corresponding mint. At the same time, banks and licensed vendors use multiple measures to fight fakes, including special equipment analyzing the metal and the integrity of the coin. Alpari Gold has one as well.
