Why invest in gold?

Throughout human history, gold has been used as money. Apart from its monetary role, it has many other uses, from being used for making jewellery to its role in industry. The precious metal is a safe haven asset and, in the long term, a hedge for personal finances against inflation. Unlike currencies, which depreciate over time, the price of gold remains stable and rising over the long term.

This is partly due to its limited quantities and difficult mining, which allows investors to preserve their purchasing power. But the driving point is that it is always associated with value. Gold is the instrument to which both individuals and institutions (including central banks themselves) turn to ensure the stability of their portfolio.

At the same time, investing in physical investment gold does not require a large capital investment, perhaps contrary to expectations. Let us introduce you in more detail in the article.

Buying investment gold

This is one of the most common ways to invest in gold. There are two choices here - investment bars of at least 99.5% purity and investment coins that are of at least 90% purity. Investment gold is exempt from VAT in the European Union, including Bulgaria.

Jewellery is not investment gold and is generally not a suitable store of value. They include not only the mark-up due to value added tax but also the cost of manufacture. The latter can easily be higher than the price of the gold contained in them.

Investing in gold bars

Investment gold bars are available in a wide range of weights. The larger the bar, the more the premium is reduced and the closer it follows the spot price of the gold contained within.

The world's most popular .9999 bars are produced by a reputable manufacturer (e.g. Swiss refiners Valcambi, PAMP, Argor-Heraeus and others). Because they are traded worldwide, they always follow close to the spot price of the gold contained in the bar.

Products in this category are shipped in vacuum protective packaging by the manufacturer. Their certificate of authenticity is also part of them. Consumers should not damage or unpack them in order to prevent losing the investment properties of their product.

Investing in gold coins

Unlike bars, gold coins come in lesser weights than bars. Modern ones typically contain one ounce of gold or a fraction of an ounce. Most of them have a purity of .9999. Investment gold coins are or were legal tender, that is, they have a face value in a particular currency. For example, the Vienna Philharmonic coin is the only one denominated in euros.

To check the authenticity of gold coins, review their design. All the visual elements should be extremely detailed, and there should be no discrepancies in the size of the coins from the one set by the manufacturer. In the case of coins where the manufacturer has incorporated additional anti-counterfeiting security features, all of them should be as described. Injuries to the coins shall impair their value.

What else do you need to know?

If you've decided to invest in gold, be aware of the additional costs. One of them is safe storage in bank vaults, especially when we are talking about large quantities.

Who you buy investment gold from is important. Be sure to invest in one from established dealers who source directly from reputable producers - refineries and mints themselves.

Remember that just as with stocks and cryptocurrencies, gold prices fall and rise again. The value of no asset moves consistently in one direction. But gold's long-term reliability has always proven itself.

The precious metal is a suitable choice for anyone seeking stability for their investments. Whether in the form of investment coins or bars, gold stands out for its reliability over the long term.

The investment approach is according to your preference, and each option comes with its own characteristics. Ultimately, whatever type of investment gold you choose, always go with reputable dealers. This is the only way you will be assured of its authenticity.

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