A pawn shop can also sell gold, so if you're looking to invest in gold, this could be a good option. Keep in mind the spot price of gold (the price per ounce right now on the market) as you buy, or you could even consider rolling over an IRA into gold. Streaming and royalty companies are another way to invest in gold through stocks, or you could open a gold investment account. These companies will provide cash in advance to mining companies so that they can buy gold (or other commodities) in the future. Think of them as funding companies that receive their profits in gold. This form of investment also requires inventors to learn more about the risks of gold mining and associated companies.
The level of research required to successfully invest in streaming companies and royalties may be a barrier to entry for some. Other funds invest in both ingots and shares of publicly traded companies in the gold mining, refining or production business. SPDR Gold Shares ETF options are also available to investors and can be traded on a standard brokerage account that has received approval to trade options. They are well positioned to benefit from rising gold prices without taking on the risks associated with physically mining gold.
More experienced investors who don't want to risk a large amount of capital could consider options on gold futures or options on a gold ETF. Through the Chicago Mercantile Exchange, options to buy and sell gold futures can be bought and sold through a futures broker. In fact, if you look at longer time horizons, such as over the past 30 years, the Dow Jones industrial average, a good representation of the stock market in general, has significantly surpassed gold. Often, the best thing you can do for your portfolio is to follow your investment plan, not rush to buy gold bars.
Despite its former appeal, gold isn't always the strong investment that movies and television shows may have led you to believe. Basically, gold isn't just a hedge against inflation or interest rates, but it's a hedge against pessimism. This can be beneficial if your goal is to diversify, although it may require learning about markets other than gold. To buy stocks or gold funds, you'll need a brokerage account, which you can open with an online broker (here's a step-by-step guide to opening a brokerage account).
Options can help buyers take advantage of their initial investment, although they are required to pay the underlying value of gold to fully own the option. Both investors and financial institutions buy physical gold for these purposes and, more recently, exchange-traded funds that buy gold on behalf of investors. And while the stock market has its ups and downs, investing in physical gold can involve many unexpected costs and considerations, such as insurance and safe storage. Many of today's most popular investments don't require any special storage, but gold is an exception in this case.
