Gold investments
To the city man, gold investments sounds traditional and almost archaic, especially in light of the new and modern means of investments such as stocks and bonds, mutual funds and hedge funds. But in most of the third world countries, gold is still one of the major forms of investment. Gold investments are considered one of the safest means of investment, not only because there has been much diversification in the same, but also because the risks involved in the same are not the same as investments made in stocks and bonds. What makes all the difference? What are the different forms of gold investments? What are the attractions in making such an investment? Gold has been traditionally used in the form of coins or as a form of currency in the past. But with the onset of money economy, gold began to be seen as one of the major forms of investment.
People preferred to buy gold and keep it with them, especially as a buffer for the times of crises. This was stored in terms of gold coins and was used in terms of rewards as well. Today, gold investments have come a long way. Some of the modern major forms of investments made in gold include directly buying gold in the form of coins and bars, gold mutual funds, gold deposit schemes and and gold exchange traded funds, among others.
One of the main features of gold investments is the fact that the prices of gold is subjected to inflation in other prices. For instance, the price of gold is subject to change with respect to oil prices as well. While gold may have aesthetic appeal for some people, contrary to popular belief, you will incur losses if you make jewelry out of the gold bars. The value of jewelries is lesser than gold bars and coins because in the former gold is often mixed with other metals as well and there is considerable loss in the purity of gold. However, gold in its purest form has a high liquidity factor, that is, it can be easily be converted into cash. In fact more so than other forms of real estate such as land, gems and precious stones. Gold is often used as a good form of investment to combat hedge.
There are several ways in which transactions and investments can be made in gold. Gold is available in terms of gold bars, gold coins, gold certificates, gold accounts, gold exchange-traded funds, spread betting and gold mining companies, among others. While gold bars are available in terms of size, the coins or the bullions are available in terms of weight. These are available most easily in most banks of the world. Some of the leading banks even buy and sell these coins and bars over the counter. Gold certificates, on the other hand, are the alternatives to coins and bars, so that the investor holds a certificate of ownership rather than the actual physical gold. Some of the Swiss Banks are known for offering accounts, where you can buy and sell gold. Gold exchange traded funds basically work the same way as shares do, and with some countries offering the option of not charging the sales tax and VAT. No doubt then gold investments are still very much flourishing in the world of investments.