Gold is one of the longest-lasting investments in the financial world. Because of this, investors are still looking to put money in the precious metal even in 2020. That said, the asset can still be cumbersome to purchase in bullion form. This is why many investors might seek out other ways to invest in gold.
In this post, we’ll detail some unconventional ideas to think about when investing in gold.
If you’re a speculative investor, gold futures are an exciting way to invest in gold. This is due to leverage. Basically, you can invest in gold at a low price, predict what it will be at in the future, and potentially profit. However, it’s possible to make the wrong prediction and have to owe more than you’d otherwise have earned.
This is also somewhat of a limited offering. Not every exchange allows for gold futures trading. Do some research and find the proper platform for doing so.
Stablecoins are the newest way to invest in gold. These are cryptocurrencies tied to the value of gold and allow you to buy fractional amounts without hassle.
Goldcoin is one example. With Goldcoin, you can invest in gold anonymously without paying additional shipping or storage fees. The company stores all bullion in secure vaults, which it can prove thanks to third-party audits.
Plus, if you can prove your purchase, you can even redeem your Goldcoin for physical bullion. The ratio is 1000 Goldcoin to one ounce of gold. That said, the redeem option probably won’t be too appealing for most people. Generally, users invest in the stablecoin to avoid the hassle of physical gold.
Gold Mining Stocks
Instead of investing in pure gold, you can put money into gold mining stocks. Companies that mine gold, such as Barrick Gold Corp or Goldcorp Inc., are good to consider. This way, you can profit from more than just the price of gold. Even if the physical asset is down, you can still profit from the company’s performance.
Circumventing risk is great for investors. However, it’s worth noting that a company can fail, while gold is a steadfast investment. Keep that in mind before putting money in gold mining stocks.
Instead of buying physical gold, you can purchase ownership of someone else’s gold via a certificate. While gold certificates are mostly out of vogue, banks still issue them from time to time. Generally, they’re measured in ounces rather than other weights.
While a certificate represents ownership of a companies’ gold, keep in mind the risk here. A company can go under at any time, or even lie about holding such gold. If this happens, your investment is essentially worthless. Do some research before getting one issued. They can be a great way to hold ownership of gold without buying the metal itself.
Gold funds are basically mutual funds that invest in gold-related companies. This could be in mining, production, or other processes related to gold. The idea is similar to gold mining stocks – you’re making money based on the fund’s performance.
Many invest in these over traditional gold as the potential for profit is much higher. After all, companies have more growth potential than the precious metal. That and this type of purchase avoids the fees and other cumbersome parts of buying bullion. You need a vault for a bar of gold, not for a mutual fund.
Keep in mind that these funds might invest in other precious metals as well, further increasing the chance of a rising valuation.
Now that you’re aware of these surprising ways to invest in gold, take some time to research the best companies for each. You don’t want to buy stocks or certificates from a sketchy group, after all.