For centuries gold has been coveted for its unique blend of near indestructibility, beauty, rarity and because of its status as a universal currency. Empires and nations have sought to possess gold as a medium of international exchange, as a store of wealth and in order to increase and preserve power. Individuals have used gold as a store of wealth and as insurance against the fluctuations and depreciation of paper money and other macroeconomic and geopolitical risks. Perhaps no other market in the world has the universal appeal of the gold market.
Successful investing is about the diversification and management of risk. In layman’s terms this means not having all your eggs in one basket. We know from history that markets can and do crash and if you are not diversified your entire nest egg can be wiped out.
Investing in physical gold
Physical gold should form a part of every properly diversified portfolio. It is a universal finite currency, held by every central bank of note in the world . In the same way that the family home should not be regarded as an investment, gold is not an investment per se, rather a form of ‘saving for a rainy day’ or of financial insurance. It is to be taken possession of or stored with a secure third party and should not be traded. One does not trade an insurance policy and thus as a form of financial insurance, physical gold should not be traded.
Gold bullion is the ultimate safe haven asset and a great way, if not the best way, of ensuring wealth preservation and for passing wealth from one generation to the next. Once the solid base or core holding of gold bullion is achieved in a portfolio then other investments in gold such as mining stocks and mutual funds and other more speculative gold investments can be considered.
Modern bullion coins and bars
Gold, silver, and platinum are all available in the form of bullion coins, minted in the US, in Canada, South Africa, Austria, Australia, China and other countries. Most bullion coins are minted in 1/10oz, 1/4oz, 1/2oz & 1oz form (and some can be bought in 2oz, 10oz & 1 kilo). However, one ounce gold bullion coins such as Krugerrands are by far the most popular for both small investors and high net worth individuals who like the divisibility afforded by them.
Semi-Numismatic and Numismatic Gold Coins
Numismatic or older and rare coins are bought not solely for their precious metal content but also for their rarity and their historical, aesthetic appeal. They are leveraged to the gold price which means that the price of these coins will generally surpass and increase faster than the gold price in a bull market (due to their historical and aesthetic value and to their rarity) and will decrease by more when gold is in a bear market.
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2 - 2010 1 oz Gold $50 American Buffalo PCGS MS70 Coin US $2,710.00 (0 Bid) Auction Ends: Friday Jul-30-2010 15:55:31 PDT | Watch this Item |
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2007-W ADAMS FIRST SPOUSE GOLD COIN PCGS ERROR MS70 US $5,000.00 Auction Ends: Friday Jul-30-2010 18:15:33 PDT | Watch this Item |
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1862 PCGS Civil War MS63 G$1 Gold Coin US $999.99 Auction Ends: Friday Jul-30-2010 18:27:39 PDT | Watch this Item |
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1908-VBP Denmark 20 Kroner gold coin - PCGS MS65 US $359.00 (0 Bid) Auction Ends: Friday Jul-30-2010 18:28:21 PDT | Watch this Item |
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1908-VBP Denmark 20 Kroner gold coin - PCGS MS65 US $359.00 (1 Bid) Auction Ends: Friday Jul-30-2010 18:31:09 PDT | Watch this Item |
