5 Ways to Get the Best Deal on Gold Investing

Tuesday, 16 Nov 2010 04:22 PM

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What is gold investing?
Gold investing involves the buying and selling of gold mainly for the purpose of hedging against any economic, political, social, or currency related crisis, including war, social unrest, a stock market crash, or high inflation. Since gold is the most popular precious metal, gold investments are perfect for financial gains, especially when the market is bullish. 
 
Five ways to get the best deal on gold investing:

1. Buy in the right physical form
Generally, the cheapest way to buy gold is to buy it in the form of bars, krugerrands, or sovereigns. Of these three forms, gold bars can usually be bought for the lowest percentage premium over gold, followed by krugerrands, and gold sovereigns. Other forms, like gold coins, are more expensive. If you are a serious gold investor, it is better to avoid gold coins.
 
2. Buy when prices are low
Many people are tempted to buy gold when they hear that its price is rising. This is the right action to take if the price continues to rise, but it is generally better to buy gold after the price has fallen. It is believed that a good gold investment is when you can buy within 10% of the bottom and sell within 10% of the top.
 
3. Compare percentages, not prices
When trying to compare the price of gold in its different forms, compare the percentage you pay rather than the price of each form. This is called percentage premium, or premium. This is a better system because the actual gold prices fluctuate constantly along with the underlying gold price. Look at the price as a percentage of, or above, the gold content.
 
4. Selecting your investment partner
Your partner should have a good reputation and a well-established presence in the gold-market. He or she should be exceptionally knowledgeable and experienced. Your partner should freely and clearly explain the risks involved in investing in gold and keep you well informed. If you decide to invest in gold, make sure the quote you receive from your partner is for the final price.
 
5. Expect more, demand more, and get more
Gold investing has more to do with service than it does with price. Therefore, when investing in gold you should be conscious of the amount of money you are investing. If you are investing a huge amount, you should demand more in the form of returns. Your investment should be such that it always yields a profit. 

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