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How To Invest in Precious Metals:What's the best way to invest in gold, platinum, and silver? With all the recent talk about gold and silver reaching new multi-decade highs, many people are looking for ways to invest and make handsome gains. For thousands of years, gold and other precious metals have served as stores of value. Amazingly, while all other currencies have come and gone over time, the real value of gold over several millenia has endured. You can buy about as much for an ounce of gold today as you could in Roman times. In times of inflation, precious metals have historically fared much better than other assets such as stocks and bonds, which tend to suffer.
When to invest in precious metals?Precious metals have traditionally held their value or increased in value during times of war and uncertainty. And silver has recently shot up more than 30% on talk of establishing a new silver ETF that would bolster demand for the light metal (and offset decreasing industrial usage in film developing). Back in the 1970s, silver went up over $50 per ounce (and gold went over $800 as we mentioned earlier) - but now after 30 years of inflation it was sitting at only $5-$7 until the last few months, making it seem like it is poised to move up and stay up. Like any investment, having a crystal ball is the only real way to know when and what to buy - you need to do your own research before buying or investing in any precious metal investment options. UPDATE: There are 2 ETFs that allow you to invest in gold and silver easily. The first is the iShares Silver Trust, which trades under the symbol SLV. Share prices moves in line with the value of 10 oz. of silver (ie, silver at $10 per ounce, share of SLV is $100). The other one if for gold, the streetTracks Gold Shares, trading under the symbol GLD. The price of shares of GLD reflect the value of 1/10 of an ounce of gold. So if gold is at $650, your GLD share is at about $65.Where to buy gold, silver, and platinumIf you decide you want to invest a portion of your assets in precious metals, one place to start is Monex.com. They offer gold bullion, gold coins (such as vienna philharmonics, gold canadian maple leafs, gold american eagles, and south african krugerrands), silver bullion and coins (canadian maple leafs, silver american eagles) and platinum bullion and coins. They will ship precious metal products to you, or they will store them for you at a secure bank facility. You can also use leverage and invest with 20% down. The highest price items are the Platinum American Eagles. These 1 oz. coins were first minted in 1997, but currently are in shorter supply as the price of platinum has skyrocketed. You can also check out Ampex.com (American Precious Metals Exchange) - they carry all the popular coins and bullion forms of silver, gold, and platinum, and offer 24/7 customer service. A final popular company is Kitco.com. Kitco sells not only the normal coins, bars, and bullion, but they also offer "pool" accounts, where you can hold a defined unsegmented interest in a pool of precious metals held by Kitco, letting you buy at commodity prices and not at prices specific to minted coins or products.
Many investors do not want to hold physical precious metals assets (like bars, bullions, coins), but rather prefer to invest in the overall industry of companies that mine precious metals. This includes a collection of the many large mining companies around the world, like Newmont Mines or Barrick. Buying stock in mining companies is generally leveraged to the price of the underlying commodities, but can fluctuate significantly due to hedging, company-specific problems, and industry upswings and downswings. Precious metal mutual funds are another option, spreading your risk out across many mining companies. Fidelity, T Rowe Price, and many other mutual fund companies offer funds targeted specifically at the gold and mining sectors.
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