If you are into owning mining companies, don't forget other minerals. I believe uranium is going to become a hot commodity (pun is intended).
I agree with Shane. The price of uranium will definitely continue to rise because of the excessive demand. World energy demand will increase 70% by 2030. If not nuclear power, what then?
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Some other things I should have mentioned earlier about buying gold.
Check every coin you buy. Scammers will sometimes try to include a counterfeit coin among real, legitimate coins. As a gold trader, I encountered this occurrence on more than one occasion. Someone would bring me 60 Saint Gaudens coins, and perhaps 3 of them were fake. Some dealers will just examine a few coins and assume the rest are authentic, but not identifying those 3 fake coins may cost me thousands of dollars later. Also, if you regularly trade in modern bullion coins, try to get of Fisch instrument for easy and accurate testing. The more gold you handle, the easier it becomes to spot fake gold. After a while, you can just tell if it's real or not.
Know that the following terms do not represent solid gold:
~ GF or gold-filled
~ gold-rolled
~ gold plated
~ EGP or electro gold plated
~ gold foil
~ gold leaf
These are the most common terms. There are others as well. Each term defines a specific method of overlaying a thin layer of gold atop a base metal. Don't think that these terms are bad! There are many instances in which one would not want to wear real gold. Costume jewelry is better if you know you're going out dancing or to the beach.
Also, each of these methods is not created equal! For example, a piece marked 1/20 14k GF will have a layer of 14 karat gold that is at least equal to 1/20 the total weight of the piece. Gold-filled is the thickest form of gold layering and may contain several dollars worth of gold. On the other hand, cheap gold leaf may have to be measured in microns or nanometers, because the layer is so thin and may be removed just by rubbing it with your hand. In contrast, gold filled may last a lifetime without wearing through to the underlying base metal.
Twenty-four karat is pure gold. There is nothing higher than 24k. In fact, pure 24 karat gold doesn't really exist, but gold marked 24 karat is usually at least .995 fine, or 99.5% pure and usually .999 fine. (Gold found in nature is usually around 18k to 20k, but some deposits in North Carolina, California, and Australia yield 22k gold.) In some parts of the world, karat is spelled carat, the same spelling as the measure used for gemstones, although gemstone carat weight refers to a unit of weight, whereas gold carats (or karats) refer to a ratio of purity. Some coins may not be 24k, but they may still be considered bullion. Gold bullion as currency, ISO XAU, as traded on the the world's various gold exchanges and accepted as payment against contracts between central banks, is at least .995 pure. For general investing purposes, .900 fine (21.6 karat ) or better is perfectly acceptable. For example, the world's two most widely traded gold coins are the South African Krugerrand and the British Sovereign, neither of which is 24 karat gold. In fact, some of the world's most popular gold bullion, such as the Gold American Eagle and Thai baht gold, is not pure 24 karat gold because pure gold is so soft and scratches and dents easily.
So, if you have to choose between a 1 ounce Canadian Maple Leaf coin (24 karat) and a 1 ounce South African Krugerrand coin (22 karat), don't worry! Either one will do. Some people choose the Canadian Maple Leaf because they think it has more gold. In reality, both coins contain 1 ounce of gold, but the Krugerrand is just a tiny bit larger because it also contains a small amount of copper.
Avoid over-priced collectibles. Numismatics is a great hobby, but for monetary and investing purposes, you should concern yourself with the melt value of your gold. A British Sovereign coin from the reign of Queen Victoria or a French coin from the reign of Napoleon III may seem old and thus valuable, but that's not true! Age has nothing to do with a coin's value. Condition does! A coin may come in a fancy protective case and labeled MS-70 First Strike Proof, but it may only be worth its melt value. Nearly ALL gold coins are only worth their melt value, even the really old ones. Sovereigns, French Roosters, and Swiss Helvetia coins that were struck over a hundred years ago are still traded for their melt value. Only the ones in pristine condition carry a premium.
And most importantly, DON'T BUY ANY COINS FROM TELEVISION SHOPPING CHANNELS!
Some other things I should have mentioned earlier about buying gold.
Check every coin you buy. Scammers will sometimes try to include a counterfeit coin among real, legitimate coins. As a gold trader, I encountered this occurrence on more than one occasion. Someone would bring me 60 Saint Gaudens coins, and perhaps 3 of them were fake. Some dealers will just examine a few coins and assume the rest are authentic, but not identifying those 3 fake coins may cost me thousands of dollars later. Also, if you regularly trade in modern bullion coins, try to get of Fisch instrument for easy and accurate testing. The more gold you handle, the easier it becomes to spot fake gold. After a while, you can just tell if it's real or not.
Know that the following terms do not represent solid gold:
~ GF or gold-filled
~ gold-rolled
~ gold plated
~ EGP or electro gold plated
~ gold foil
~ gold leaf
These are the most common terms. There are others as well. Each term defines a specific method of overlaying a thin layer of gold atop a base metal. Don't think that these terms are bad! There are many instances in which one would not want to wear real gold. Costume jewelry is better if you know you're going out dancing or to the beach.
Also, each of these methods is not created equal! For example, a piece marked 1/20 14k GF will have a layer of 14 karat gold that is at least equal to 1/20 the total weight of the piece. Gold-filled is the thickest form of gold layering and may contain several dollars worth of gold. On the other hand, cheap gold leaf may have to be measured in microns or nanometers, because the layer is so thin and may be removed just by rubbing it with your hand. In contrast, gold filled may last a lifetime without wearing through to the underlying base metal.
Twenty-four karat is pure gold. There is nothing higher than 24k. In fact, pure 24 karat gold doesn't really exist, but gold marked 24 karat is usually at least .995 fine, or 99.5% pure and usually .999 fine. (Gold found in nature is usually around 18k to 20k, but some deposits in North Carolina, California, and Australia yield 22k gold.) In some parts of the world, karat is spelled carat, the same spelling as the measure used for gemstones, although gemstone carat weight refers to a unit of weight, whereas gold carats (or karats) refer to a ratio of purity. Some coins may not be 24k, but they may still be considered bullion. Gold bullion as currency, ISO XAU, as traded on the the world's various gold exchanges and accepted as payment against contracts between central banks, is at least .995 pure. For general investing purposes, .900 fine (21.6 karat ) or better is perfectly acceptable. For example, the world's two most widely traded gold coins are the South African Krugerrand and the British Sovereign, neither of which is 24 karat gold. In fact, some of the world's most popular gold bullion, such as the Gold American Eagle and Thai baht gold, is not pure 24 karat gold because pure gold is so soft and scratches and dents easily.
So, if you have to choose between a 1 ounce Canadian Maple Leaf coin (24 karat) and a 1 ounce South African Krugerrand coin (22 karat), don't worry! Either one will do. Some people choose the Canadian Maple Leaf because they think it has more gold. In reality, both coins contain 1 ounce of gold, but the Krugerrand is just a tiny bit larger because it also contains a small amount of copper.
Avoid over-priced collectibles. Numismatics is a great hobby, but for monetary and investing purposes, you should concern yourself with the melt value of your gold. A British Sovereign coin from the reign of Queen Victoria or a French coin from the reign of Napoleon III may seem old and thus valuable, but that's not true! Age has nothing to do with a coin's value. Condition does! A coin may come in a fancy protective case and labeled MS-70 First Strike Proof, but it may only be worth its melt value. Nearly ALL gold coins are only worth their melt value, even the really old ones. Sovereigns, French Roosters, and Swiss Helvetia coins that were struck over a hundred years ago are still traded for their melt value. Only the ones in pristine condition carry a premium.
And most importantly, DON'T BUY ANY COINS FROM TELEVISION SHOPPING CHANNELS!
Great post and great advice.
Bullion coins are just that, they are worth the scrap (melt down) value of the gold. 'Pretty' Sovereigns in good nick, often mounted and shown off in a jewellers window have no added numismatic value as the mount damages the edges of the coin. Doesn't matter if they are Victorian or Elizabeth II, if they are mounted they are worth the same.
Can I add, DON'T BUY COINS FROM EBAY - they have inflated prices and all the bull about proof or mint condition is just that, bull.
Buy gold coins from a local dealer if you can, that way you can see (and touch) what you are buying and you can pay in cash.
For the most part, Ebay is a terrible place to buy bullion. Seriously, avoid it if you can. Stick to your local dealer when possible.
Another thing I forgot to mention, something pertinent to Ebay, is that precious metals are measured in troy weights, such as the troy ounce. Most everything else, from chicken to stainless steel, is measured in avoirdupois weights. A common scam on ebay is to sell a "pound of silver," but the seller doesn't specify if it's a troy pound or an avoirdupois pound. The buyer may think he's bidding on 16 ounces of silver, but he's actually bidding on 12.
Another thing about ETFs. If you simply plan on trading the swings in gold, an ETF is the best way to do that. But if you want to own actual physical gold, ETFs are the worst way to invest. ETFs have heavy derivative exposure, and they record the gold they have in their vault and the gold out on loan as one line item, which means they only have half the gold they say they do. Read the fine print, and you'll see that all accounts can be settled with cash in lieu of physical gold. So if you want the monetary insurance that gold provides, avoid ETFs. If you want to trade the spot gold price, ETFs are a good choice.
Has the NYSE-Liffe futures exchange run out of gold? Or at least out of 1 kg bars of the stuff? Avery Goodman on SeekingAlpha.com thinks so, and the Stock Research Portal notes that this is the second article at that site “that addresses (sort of) the question of whether the GLD ETF actually has the physical gold to back up all of its outstanding shares.” Quite a few people seem to be worrying about this. As the SRP says, “This is an issue that I see raised continually.”
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Ever since stocks around the globe have come to a collapse I've been reorganizing my investments. I recently had a talk with a friend about gold and did some research. BullionVault.com, etc.
What suggestions, tips or recommendations would you make?
I think the precious metals market is the safest at the moment, although I recommend you make sure that only a portion of your investments in this type and others invest in Forex. I know that now is not the most stable currency, but using a good strategy and good leverage, you could get good benefits.
Hi David,
As you said investing in precious metal market, Can you specify some of them which you had been investing on.
Regards
Conan
Gold and platinum are the metals that represent a better investment. You can do it by acquiring Liberty, eGold (this is in trouble) or similar. So you can invest in the stock market..
Re: How to invest in Gold?
Re: How to invest in Gold?
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