Have you ever wondered how you can purchase gold? Wealthion’s James Connor breaks down how to purchase this valuable precious metal as an asset. Discover how to buy and store gold and from this video. Learn everything you need to know about buying gold and as an investment.
James Connor 0:05
Hi and welcome to Wealthion I'm James Conner. This video is part of our Wealthion Academy and will focus on the benefits of owning gold as well as how to invest in gold. Gold serves many purposes including a hedge against inflation, a store of value, and also provides diversification of your portfolio. We're living through unprecedented times with geopolitical risk stratospheric inflation, and also economic uncertainty and so the reasons for owning gold are more apparent now than ever before. What I want to do in the next few minutes is take you through the benefits of investing in the various forms of gold, starting from the least risky which is owning gold bullion, and concluding with the highest level of risk and that is investing in a gold mining company. Let's begin with the first option available to investors and that is a direct investment in gold bullion or gold coins. Gold is a real asset and is considered a hedge against inflation just like real estate or a piece of art. But unlike those assets, the price of gold is easily transferable and it can be easily liquidated. Billions of dollars of gold are transacted every day on exchanges all around the world. And you can always see what the price of spot gold is at any moment in time on any financial platform including Bloomberg, CNBC, and many others. When purchasing physical gold, you have two options. You can buy physical bullion or you can purchase a gold coin like an American eagle or a Canadian maple. Gold coins will always cost a little bit more due to the minting charges and also the costs of production. When you buy gold bullion or coins deal with reputable dealers like our sister company Hard Assets Alliance. Hard Assets Alliance is a trusted platform used by over 100,000 institutional and retail investors and it has over $3 billion in assets. hard assets alliance will deliver the goal to you personally or you can store it in a vault. All the holdings in the vault are reconciled daily or audited by an independent specialty firm on a regular basis. All holdings are also insured at all times for their full replacement value. You can find out more information at hard assets alliance.com. When you go to the website and you want to find out what products are available, simply hit products and pricing. Click on it and you can scroll down and click on gold products. And there it is. So you can look at the price of the gold, the Canadian maple, you can scroll further down and you can see the American Eagle and various sizes. Very easy to maneuver. Once again hard assets alliance.com. The second option available to investors are gold ETFs gold ETFs are traded on exchanges like stocks and can be bought and sold the same way. ETFs are extremely illiquid, and they don't have the premiums or the storage and shipping fees that come with buying bullion. It's important to understand though that many gold ETFs are not backed by gold bullion at all but are instead backed by futures contracts and therefore they're referred to as paper gold. If your time horizon is short, and you want to make a directional bet on the price of gold and gold ETFs might be a viable option. The last option available to investors is also the highest risk option that is acquiring shares in a gold mining company. I'm sticking to producing mining companies only and stay away from exploration and development companies just due to the excess of risk levels. Investing in mining companies that are producing can provide additional leverage to the price of gold. But that higher leverage also comes with a higher level of risk. And I want to outline the various elements of risk. There's operational risk, gold miners are profitable only if they can extract and process the goal that of profit. If they run into any sort of complication associated with the processing of that gold, then the gold miner will lose money. Another risk is geological risk. All gold mines have a finite life and so it's imperative for the gold mining company to explore. And sometimes they might spend 10s of millions of dollars every year looking for new gold reserves. So there's also the risk that the gold company can't find any more gold in the gold mine runs out of gold. Another common risk is geopolitical risk. If a gold mining company is operating in a country which does not respect the rule of law, then it's possible that a country can nationalize the mind and in effect steal the mind from its shareholders. And this has happened numerous times especially if the mind is highly profitable. In short, mining companies come with many more risks than you will find with owning physical gold. When determining what is the right form of gold investment for you. You speak to your financial advisor and depending on your risk profile, they can guide you in the right direction. To learn more about gold and the benefits of voting gold, check out our sister company HardAssetsAlliance.com Don't forget to subscribe to our channel, wealthion.com and also hit that notification button to be kept up to date on upcoming events. Our next educational video will focus on silver. Once again I want to thank you for spending time with us today and I look forward to seeing you again soon.
