Buying gold bullion is a highly lucrative way to invest your hard-earned money and diversify your risk. But, as with any other type of investment, how successful you are is determined by how solid your strategy is.
Here are some basics on how to buy gold bullion in Brisbane or wherever you may live.
Firstly, What Is Bullion?
Gold bullion is a bulk quantity of precious metal, measured by weight and usually cast as bars.
How It Works
The basic aim of buying gold bullion is to buy it when prices are low and then sell when prices are high. But, neither life nor markets are that simple, or that easy to predict. If they were, then most of us would have bought gold when prices began climbing years ago.
Overall, precious metals are a long-term investment. So, if you can buy when there’s a dip in price, that is the way to go. However, bullion moves on a different track to other commodities and equities which can make it a handy hedge against losses.
How to Buy Bullion
The only way to really get bullion is to buy and own the product. You can decide whether you want to keep it on your premises or make use of a secure third-party vault.
Analysts tend to agree that investing in commodities such as precious metals is a good way to go. Yet, while a rise in gold spot selling prices can certainly improve the fortune of a mining conglomeration, it will face challenges from increasing costs and declining output. Therefore, the share price doesn’t add up with the way the bullion rises in price.
On the other hand, you can invest in ETCs and paper gold certificates which claim to grant you ownership of a real asset. However, the definition of ownership is often cloudy, and you do need to understand what the concepts involve. It’s usually better to invest in the physical bullion and decide for yourself where to store it.
Where to Buy Bullion
You can physically buy bullion from gold dealers. Keep in mind, depending on the country in which you buy the gold, there may be taxes.
How to Sell Bullion
Finally, it’s important to invest with a supplier that offers a liquid, transparent market for buying back the bullion at favourable prices that will not disadvantage the holder. Reputable suppliers do offer transparent selling processes that are advantageous and straight forward. Always be wary of “all in one” type of pricing where you just can’t relate the deal to current market rates.
You’ll probably discover that companies who sell bullion, especially when it comes to gold bars, discount the market price by just 2 – 2.5 percent if you bought it directly from them. But, if you’ve bought the bars elsewhere, you may be penalised by a 4 percent cost.
You can use this guide as a good starting point on how to buy and sell gold bullion and where to store it.
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