Gold has become one of the most popular investment assets available around the world. It’s a surprisingly accessible investment too, suiting many people’s budgets, aims and experience level.
Should I Invest in Gold?
We can’t speculate too much about the future of precious metal prices, but we can be certain that gold bullion assets have historically offered buyers a safe haven, providing a balance to their portfolios even during times of economic turbulence.
No matter what your investment interest, the flexibility of gold as an investment means that there is a range of gold assets on offer to suit almost any buyer. Gold bullion coins are a popular option, investors the chance to buy almost any number of coins of between 22 and 24 carat purity. Gold bullion coins are easy to separate and distribute throughout multiple sales as well, making them an ideal choice for those uncertain of their long-term intentions or wary of an ever-changing market. The fact that they are often limited edition or harder to come by than gold bullion bars also adds another edge to their potential value.
Gold bars, however, remain a traditional and popular investment choice. Available from between one gram to 12 kilograms, larger bars generally offer the best long-term investment potential with regards to purchase margins, but smaller bars are the best option for an investor hoping to take advantage of favourable market prices, or test out a smaller financial commitment.
Advantages of Gold Investment
Gold is considered one of the most stable and reliable forms of investment available and is generally seen as a wise choice to balance investment portfolios during times of political and economic instability, protecting the investor against the factors that often threaten other forms of trading.
Some of the main advantages of gold investment include:
Protection against inflation – Gold is considered to be a reliable hedge against inflation, traditionally holding strong as other commodities weaken.
Protection against currency depreciation – Currency depreciation is one of the biggest challenges currently facing modern governments. Gold is considered to be exceptional at holding strong against the US dollar, the world’s primary trading currency, and any weakening in the dollar often prompts gold prices to rise.
Performance – Over the past 35 years, gold has seen one of the most remarkable performances of any asset. In fact, this popular investment has grown from £110 per troy ounce in 1978 to £1,072 in 2013, an increase of 875 per cent.
Tax free – In the UK, certain gold assets are free from Capital Gains Tax (CGT), which means investors do not have to pay any tax when they sell.
Gold vs. Silver
Traditionally, gold and silver markets fluctuate at a similar rate, so you’d be forgiven for expecting the security of investments in each asset to be equally low risk. However, silver is renowned for making larger movements than its yellow counterpart, which can make investment stressful for new or hobby buyers. Silver is also less popular for investing due to the fact that it requires VAT on top of its live price. This can result in significantly smaller profits if not taken into account.
If you’re considering buying gold as an investment and would like to know more, please feel free to contact our friendly team on 0121 523 1047.