But how can you invest in precious metals like gold and silver While assets like publicly traded stocks have a fairly straightforward buying process, investing in gold and silver can be a little bit more complex, given the variety of ways to buy these precious metals.
The good news, though, is that you don't have to literally mine for gold to reap the potential benefits. There are several other ways to gain exposure to gold and silver in your portfolio, as we'll explore here.
But don't let the names fool you. You probably don't have to open separate accounts if you want to buy both types of metals. Generally, these are self-directed IRAs that allow you to purchase physical gold, silver, or other assets that qualify for the tax advantages of a regular IRA, and the bullion can be held in a depository.
But not all financial services companies offer IRAs in which you can buy physical gold or silver. So, if you have an existing IRA and don't want to open another one, you might instead invest in assets like gold ETFs through your regular IRA, rather than physical gold. Keep in mind though the risk that can come with speculating on precious metals, especially as you near retirement.
Fees are generally higher for specialized accounts like gold IRAs, compared with regular IRAs. A custodian for your account might charge a few hundred dollars per year in administration fees, depending on the bullion value in your account, compared with perhaps $40 or so (if not $0) with some regular IRA accounts.
However, fees can differ depending on what you ultimately invest in within an IRA, such as how mutual funds carry annual management fees. And fees for gold IRAs/silver IRAs can also vary, such as if the provider charges separate trading fees.
One of the easiest ways to buy gold or silver is to invest in gold exchange-traded funds (ETFs) or silver ETFs, which essentially trade like regular stocks. You can buy and sell ETFs through your stock brokerage. The ETF provider typically holds physical gold or silver bullion, and the value of those precious metals gets reflected in the ETF's share price.
Another way to invest in gold or silver is to get exposure via stock in mining companies. In theory, if precious metals prices go up, then companies that mine those metals would also increase in value, but prices can also depend on how these companies operate.
You can buy stock in specific mining companies, much as you would trade tech stocks, for instance. Or, you can buy an ETF that invests in a variety of gold or silver mining companies (or perhaps both). Fees for mining ETFs tend to be a bit higher than bullion ETFs.
Another option for investing in gold or silver is buying physical bullion, such as gold bars or gold coins, or silver bars and coins. Bars and coins can have designs/images on them, for which they are sometimes considered collectibles.
You can find some companies that sell physical gold and silver online and ship the bullion to you. However, this can be more expensive than other forms of buying precious metals. The prices of physical gold could be roughly 5-10% higher than the current trading price, if not more. Silver bullion can trade at even higher premiums, like 25% or more, though the entry point is significantly lower than it is for gold.
Plus, you then have to figure out how to safely store the bullion, such as in a safe in your home or at a depository. You can also find some physical stores that buy and sell gold and silver, but you also will often pay a premium there.
There are many ways to buy gold and silver, so consider what you're looking to achieve with these investments before picking a path. If you like the idea of physically owning gold or silver coins, for example, then you might go down that route, but if you prefer the liquidity and relative ease of trading stocks, then you might buy an ETF or shares of mining companies. Consider consulting with a financial advisor or trusted professional to see what's right for you. Learn more now!
1 Our pricing is based off of the current TD bid and ask prices. The value of each product is dictated by the market price of gold, silver and platinum. Current market conditions may affect the value of each product and can change from second to second.
The U.S. Mint launched the American Eagle Coin Program in 1986 with gold and silver bullion coins for investors. The program has since expanded to include platinum and palladium coins. The Mint also makes proof and uncirculated versions of the American Eagle coins for collecting.
American Eagle Palladium Coins were first released in 2017 as bullion and 2018 as proof. Like the silver coins, the palladium coins re-create historic designs by Adolph Weinman. The obverse features Liberty wearing a cap with wings used on the 1916 Mercury Dime. The reverse shows an eagle grasping a branch first used on the 1907 American Institute of Architects Gold Medal.
American Eagle Bullion Coins provide investors with a convenient and cost effective way to add a small amount of physical gold, silver, platinum, or palladium to their investment portfolios. The gold bullion coins are available in four sizes: one ounce, one-half ounce, one-quarter ounce, and one-tenth ounce. The silver, platinum, and palladium bullion coins are available in the one ounce size.
The Mint produces American Eagle Coins for collectors with proof and uncirculated finishes. The gold and silver coins are released in both proof and uncirculated finishes each year. The platinum coins are currently made only as proof, while the palladium coins switch finishes each year.
All the gold and silver within the Kinesis system is independently audited twice a year, by Inspectorate, a Bureau Veritas company and leading global physical commodity audit and inspection specialist.
As we have vaults all over the world, Kinesis is able to offer you the best price selected from all the major trading hubs around the world. For this reason, Kinesis is able to offer prices among the best for physical gold and silver, globally.
Assets such as gold and silver are ruled by the law of physical supply; there is only so much gold and silver available. When you buy gold or silver, you can physically see the item and weigh it yourself if you chose, so it is much easier to determine the actual value.
Where does gold and silver bullion come from After the metal has been mined and then refined, it is generally sold to bullion banks. These banks are the middlemen between the suppliers and the buyers.
Gold producers sell to the banks, despite what the market demands at that particular moment are, and buyers purchase from the bank. The bank stores the gold, handles financing and basically distributes the gold across the globe for investment or industrial purposes, or jewelry. The buyers in this instance are the companies or mints that sell the bars or coins.
Perhaps the easiest and best way to buy gold and silver is to simply purchase bars. Investors generally buy gold or silver in bars as they are less expensive (or closer to commodities exchange prices) than coins.
Gold and silver bars are purchased per ounce. You can buy them as 1-ounce bars, 10 ounces, 100 grams and 1 kg (32.15 ounces). Gold and silver prices are easy to find online, making it simpler to determine your budget. These precious metals are sold in troy ounces that is slightly (about 10%) heavier than a normal ounce.
While you are determining your budget, the price of gold or silver on the exchange is only an indicator to compare prices charged by bullion companies and ensure that you are being charged fairly. The company that you decide to purchase from will, of course, put a markup on the metals.
Ensure that the company you will be using to purchase the gold bars has a good reputation. Do your research by checking their website and reading reviews online about their service. Also, run a check through the Securities and Exchange Commission to make sure that they have not been reported for any questionable behavior.
Authentic gold and silver will be properly identified with a recognizable hallmark which is stamped on by the refiners. Not all governments sell gold bars and if it is sold by a government it should also display a hallmark. A good hallmark indicates a good quality metal. Check with your buyer which refinery processed your bars.
A bullion coin is often sold for about 4 or 5% more than its value if it were melted. The simplest method of seeing if you are getting a good deal is to check the price of gold and silver per ounce and compare it to the price of a bullion coin per ounce.
The safest and best way to buy gold and silver is to do your homework properly, decide what is best for you, and to use a reputable supplier. If you keep that in mind, your investment will increase in value and give you peace of mind for years to come.
However, silver does have much more industrial and commercial use than gold. Approximately half of all silver bought and sold on the market is used commercially, with applications ranging from dentistry to electronics. (This is still quite small compared to other metals, which are almost entirely used for production.) By contrast, gold has very few commercial applications aside from jewelry. This gives investors a basis on which to judge and predict price movements for silver, since you can make decisions based on factors such as industry need and how the global economy is moving.
At time of writing, silver traded at approximately $25.77 per ounce. Gold traded at $1,960 per ounce. While the details vary, the gap is consistent. Gold is historically much more expensive than silver. This is in part because silver deposits are nearly 20 times as common as gold. This leads to two outcomes for investors.
By contrast, silver tends to move with the economy overall, at least more so than gold. This is in significant part because of the same commercial applications that make silver a more predictable asset. When the economy slows down, industries need less silver for manufacturing, driving the price down. 59ce067264