Gold has proved to be one of the safest and most consistently performing investments over the years. In an uncertain global economic environment, gold has shown remarkable resilience, and has in fact, delivered excellent appreciation to investors when most other forms of investments are eroding in value.
Reasons to Invest in Gold
A weakening American dollar and the persistent sovereign debt crisis in Europe have led to a diminished economic confidence worldwide. Central banks in many countries have been gradually increasing their holdings in gold as a part of their foreign reserves. Many investors are also increasingly tilted in favor of maintaining a significant part of their investments in gold in order to add more stability to their portfolios. This has led to a growing demand for gold, and fueled a consistent rise in prices over the last several years.
Countries such as China and India have been quietly expanding their consumption of gold. One of the reasons for this is the seemingly collapsing Euro and the American government, the current administration, has not instilled much confidence in terms of worldwide investors and the American dollar.Moreover, the global production volumes in gold are not able to keep pace with the demand, resulting in rising prices in gold. Almost all the major gold funds are in a long term uptrend phase, and most economic indicators show that the gold bull market is going to continue in the foreseeable future. Short positions held by hedge gold funds have been systematically reduced, considering the bullish trends.
The continuing global economic uncertainty has been driving investors away from traditional avenues such as stocks, bonds, mutual funds, and real estate. Investors believe that their money is relatively more secure in gold, and it will deliver a superior rate of return over a period of time, compared to other traditional investments. A large number of people are moving their retirement savings from traditional retirement accounts to gold based retirement accounts, which affirms the general faith in the long term strengths of gold as an investment.
How to Invest in Gold
Investments in gold can be made in multiple forms, depending on the personal choices and needs of different investors. A few large online gold dealers have made the task of investing in gold much easier in recent years. These dealers provide an efficient and secure online environment for the investors to make their purchases in gold conveniently. Top dealers have highly professional teams to provide guidance and consultation to potential investors regarding the best ways to invest in gold.
Investments in physical gold are popularly made in the form of gold coins. The most popular gold coins for investment around the world are one ounce coins such as the American Gold Eagle, the South African Krugerrand, the Canadian Maple Leaf, and the Austrian Vienna Philharmonic. These gold bullion coins closely match the prices of spot gold, and are easily purchasable through authorized gold dealers. Gold bars and collectible gold coins are also available in the market. Investments in gold can also be made in the form of gold certificates, gold ETFs, gold futures and options, gold miners’ stocks, and gold mutual funds.