Hi. I'm new at gold investment. I want to buy gold bars or coins because they hold more value than my money just sitting in the bank. But since I am not experienced with gold or coins, should I play it safe and just invest in gold bars? Or should I get gold coins like the panda or eagle?
Playing it safe and investing are no longer possible. Gold is risky just like any other investment. Research before you buy anything to decide if gold is the right investment for you.
I agree any precious metal is not "safe". It can protect you from some scenarios of your currency weakening, but "safe" is not a word I would use with the volatility PM has shown over the past few years. Regarding type of gold, I am more of a believer in coins. Because they have many authentication points, (size, weight, design), its easier to prove a coin is authentic than a bar. A bar must be at least partially destroyed to prove its really pure gold. If you really want some extra security, buy slabbed gold graded MS69. Do not pay more than a couple of bucks for the slab. These are the rejects from dealers trying to get MS70 graded coins, but the slab, (unless itself is counterfeit), gives you more assurance the coin is real. A good website if you are in the market is: www.comparegoldprices.com Dealers there are reputable, but you can also ask on CT for references.
I say buy both so you have more variety. Looking at the same thing gets boring, thats why when I get 90% silver, I love getting halves, quarters and dimes and then rounding it out with some morgans and peace....looks nice! Do the same with gold, some govt bullion, some bars, etc and it will look nice
until you learn as to what is what, you are taking more risk than you realize. For example, do you know that a ASE is 22K gold where the Buffalo is 24k? Do you know the difference between Mint bars and non-mint, or what assay is?
I like coins better than bars. I have purchased some gold in the past, but only in coin form. I don't think I would ever consider bars. From a storage perspective bars are potentially easier to deal with. But they don't have the history or visual appeal that coins can have.
I don't know why the 22k vs 24k even matters. An ounce of gold is an ounce of gold. The coin weighs more to account for the other metals. Gold Maple is 1 oz....AGE is 1.090 oz
Well, without knowing or understanding the difference it will matter. For example, someone weighing a AGE might wonder why it is heavy if they do not understand this. In addition, to get to .999 you would have to melt the AGE down, where the Buffalo is already there. My point was, and is, just asking what form of bullion to buy is not sufficient.
This is not rocket science, both are one oz. Gold and the OP would most likely do equally well or bad with either puchase by just doing the minimum of reasearch and buying from a known reputable dealer like Provident or Apmex.
I think the other thing to consider is 1) the premium you have to pay as compared to other commissionable investments, and 2) your time horizon; in other words, when will you need the money? With regard to #1, if you buy a 1oz gold coin, you can expect to pay as much as $70 over spot price - as I write this, gold is currently $1,356 per oz. So just on the buy side of the transaction, you have a "commission" of over 5%. You can buy $1,356 worth of mutual funds at NAV with no commission at all, or place a stock trade for $7.95. And on the sell side of the transaction, you can expect a similar cost to liquidate. Silver can be even worse... $3 over spot at $20 per oz is a 15% commission!!! Sheesh! As for #2, I would not recommend gold or silver unless you plan to hold it for quite some time. If you might need the money sometime soon (due to other expenses, lost job, etc.), PMs are not all that "liquid". You can get cash from your bank today if needed, but trying to find a buyer to sell your PMs to, get a check and have cash in hand may take days or even weeks. Also, I would not recommend buying gold/silver and trying to time the market and flip it to make a quick profit. Easy to get burned that way. PMs are a good hedge against inflation, and pricing changes in fiat currency. Having said that, I have less than 1% of my wealth in gold and silver. Just my 2 cents.
