You may have heard that stocks and gold usually move in opposite directions. While this may be true to an extent, it doesn’t tell the whole story. Many people invest in gold when a financial crisis is happening, and quality investment opportunities are few and far between. One of the main reasons is because gold holds its value very well and is often a better investment than putting money in a savings account. Here are some strategies to consider if you’re interested in investing in gold as part of your portfolio management strategy.
Purchase Gold Exchange-Traded Funds
Like stocks, gold exchange-traded funds (ETFs) are some of the most convenient ways to invest in the precious metal. By purchasing a gold ETF, you are buying shares in physical gold that can be traded just as easily as a stock can. Gold ETFs are great for beginner investors who want to include gold as part of their portfolio management strategy. Some would argue that gold ETFs are better than purchasing physical gold since you don’t have to keep up with it in physical form.
Invest In Gold Mining Companies
It’s possible to invest in companies that mine for gold if you don’t want to invest in physical gold. However, there are some things you need to consider before doing so. Unlike physical gold, companies that mine for gold are not nearly as stable when it comes to their value. These companies typically operate in various regions of the world, and many of them are unstable. And if the price of gold in general decreases, then you’ll likely see the price of gold mining companies sharply decline as well. Any investor who wants to invest in gold mining companies should use it for diversification purposely only and don’t expect to achieve financial success using this investment method solely.
Consider Gold Exchange-Traded Notes
An exchange-traded note (ETN) is defined as unsecured debt security and is connected to an underlying investment. Gold can be that underlying investment, and once the debt security reaches maturity, you get paid on the performance of the gold. Most of the time, the average investor won’t choose gold ETNs as a viable investment option since they are risky and requires significant knowledge and experience in the gold industry to make a profit.
Buy Gold Bars Or Coins
One of the gold investment opportunities that will almost always be present is purchasing physical gold bars or coins. You can buy physical gold by the ounce and keep it stored at your home, by the dealer, at your bank, or any other secure space. Your investment in physical gold may not lead you to financial success, but it can be a great portfolio investment for diversification purposes.
Stock Investing Info helps investors learn the ins-and-outs of investing in gold. Gold can provide some interesting investment opportunities, but those opportunities aren’t viable for every investor. If you’re interested in investing in gold or want to learn more about how to do so, contact us today to speak with a professional.