How Can I Invest in Gold? What Options are Available?

Mar 08, 2023
loveGOLDᵀᴹ
2 minute read

One of the great things about gold, is that there are many different investment options. Speaking to a financial advisor about which option is best for you is always recommended.

Every investor will have a different need or objective, so having a range of products available means that people can choose based on their needs and their personal situations at the time.

We tend to differentiate gold investment options in terms of products that give direct physical ownership of the gold (e.g. bullion) versus products that give exposure without necessarily taking that ownership (e.g. Exchange-traded funds, equities or derivatives).

Here is a quick overview of some of the better known options:

Gold Bullion Bars & Coins

Offer physical ownership and possession of gold. It is available in a vast range of sizes and weights, which gives investors the option of either a low entry point or a more substantial investment. It is available from many dealers, distributors and mints across the globe, and its price will vary from one to the next.

Exchange-traded funds (ETFs)

Have been around for nearly 20 years. They are exchange-traded products, which give investors the ownership of the proportion of the gold that underlies that fund without having to take physical ownership of the gold. For the most part, they will be fully backed by physical gold.

Gold Mining Equities

A product that will give investors exposure to changes in the gold price, according to the gold mining company that they're investing in, but it's not a direct investment in gold itself.

Whilst changes in the price of gold will determine a certain amount of change in the price of the equity, there will be other factors [that are specific to the company or the wider economic and political landscape, for example] that will also affect the value and price of that investment.

Gold Derivatives

Gold derivatives –futures and options– are contracts that give investors either the obligation or the right to buy an amount of gold in the future. This option appeals to the more sophisticated investor. Derivatives are often of a larger investment size, they can involve leverage and are complex in terms of the types of accounts required to trade them.

Gold investment options include products like bars and coins that give direct physical ownership of the gold.

One of the great things about gold, is that there are many different investment options. Speaking to a financial advisor about which option is best for you is always recommended.

Every investor will have a different need or objective, so having a range of products available means that people can choose based on their needs and their personal situations at the time.

Here is a quick overview of some of the better known options:

Gold Bullion Bars & Coins

Exchange-traded funds (ETFs)

Gold Mining Equities

A product that will give investors exposure to changes in the gold price, according to the gold mining company that they're investing in, but it's not a direct investment in gold itself.

Gold Derivatives

Insights provided by the World Gold Council

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