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Who Wants To Invest In Gold?

November 12, 2010

Gold has soared more than 400% since its low of $255.95 on April 2, 2001, driven by fears of inflation and the declining value of the dollar on the global currency markets. If you want to invest in gold, you have several choices:Pot of Gold

  • Collectible Gold Coins: Pros: Intrinsic beauty; scarcity. Cons: High markup over value of gold in coin; difficulty for novices to master coin grading; storage.
  • Gold Bullion: Pros: Don’t need to be tested for purity; portable; available in many sizes. Cons: You have to store and insure your coins.
  • Gold-Mining Stocks: Pros: Easily traded; tend to rise more than the metal itself; may pay dividends. Cons: Not gold. If you’re worried about the U.S. dollar, owning a stock isn’t the answer.
  • Gold Funds: Pros: Diversified portfolio of gold-mining stocks. Cons: Managements fees; not the metal itself.
  • Gold EFT-s: Pros: Easily tradable; low-cost; diversified. Cons: Easily tradable; and not metal itself.

Which is best? It depends on how much you money you have, how long you plan to hold your investment, and why you are investing in the yellow metal. Be aware that gold was much more appealing at $225.95 than it is at more than $1,300. And don’t go overboard as a 5% to 10% position in gold is enough for nearly everyone. Give us a call at 212-979-6830 or stop by and see us as we can help with helping you make your decision. At GAI (www.gunwel.com) we are here to help. See you soon!

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