For many years, precious metals have been used as the basic and universally accepted currency. Today, paper money has replaced precious metals as currency due to its convenience. However, despite the advantages of paper money, gold and silver remain important commodities in the global financial markets. Informed investors can capitalize on the values of gold and silver to bolster their financial portfolios. Here are a few tips on how to invest in gold and silver online.
Buying coins minted from pure metals is the easiest and most convenient method of investing in gold and silver. Some of the most precious coins to invest in silver include quarters, dimes and half dollars minted in the U.S. before 1965. While these coins were alloyed with other metals, they are about 90 percent pure silver. They are easier to acquire and contain enough silver to make them significant investments. Unfortunately, gold coins were not produced for mass circulation, but there are substantial amounts of gold coins in the market containing enough gold to make them worthwhile investments.
While bullions are relatively more difficult to acquire than coins, gold and silver bars are considered one of the best methods of investing in precious metals. Bullions are about 99 percent pure gold or silver and are not subject to fluctuations associated with paper currency issued by countries around the world. While buying gold and silver bullions is considered a significant investment, they come with high premium and the necessity to store and protect the metal.
Precious Metal Mutual Funds
Buying precious metals mutual funds is considered an indirect method of investing in gold and silver. Buying gold and silver ETFs and mutual funds means that you do not actually own physical gold or silver but actually own a stake in the precious metal industry. This type of investment does not require much commitment and is an attractive investment for investors who prefer to profit from gold and silver rather than actually possessing the precious metals.
Like precious metal ETFs and mutual funds, buying stock in mining companies does not actually bring you tangible gold and silver. Instead, this type of investment allows you to participate in the significant investments of companies in the mining industry producing significant quantities of gold and silver. However, do not make the mistake of investing in small gold miners that are in the exploration phase and do not have significant cash flows. Only the stock of a few mining companies are worth buying.
Investing in gold and silver precious metals is one of the best methods of guarding against inflation and diversifying your investment portfolio. While investing in physical gold and silver can produce significant returns, it has some inherent disadvantages. Bullion bars need to be insured and a place for safe storage. Fortunately, you have other methods of investing in gold and silver.