Investing in gold has long been a popular way to hedge against inflation and diversify investment portfolios. Among the various forms of gold investment, gold bars stand out as one of the most popular choices. But not all gold bars are created equal when it comes to investment value. Here are 3 key facts to consider before buying gold bars for investment.
Consider the reputation and credibility of the refiner
The reputation and credibility of the gold bar refiner is one of the most important factors affecting investment value. Some of the most well-known major refiners include PAMP Suisse, Perth Mint, Royal Canadian Mint, etc. Bars from these reputable mints tend to carry a higher premium. On the other hand, lesser known refiners may sell bars at a lower cost, but their credibility may be questionable.
Pay attention to the gold purity and content
Gold bars can have purity levels ranging from 99.5% to 99.99%. Higher purity bars will naturally command higher premiums. Apart from purity, the actual gold content is also important. 1 oz gold bars are recommended for beginners. Larger bars like 100 g and 1 kg can be more cost efficient, but are harder to liquidate.
Consider practicality of storage and resale
The specific size and design of the gold bar will impact its practicality. Smaller bars like 1 oz are easier to store and liquidate. Larger bars may appear more cost efficient, but storage and future resale become more problematic. Gold bars from famous mints retain value better and are easier to resell. Generic or obscure bars often sell at discounts.
Compare pricing from multiple dealers
Premiums and pricing can vary widely among gold bar dealers and retailers. Always compare prices from multiple sources, considering any applicable shipping, insurance and storage fees. Online dealers tend to offer lower premiums over spot price. Local retailers are more suitable for faster access or sales in emergency situations.
When investing in gold bars, considering the refiner reputation, gold purity, practicality, and comparative pricing is key to maximizing investment value. Favoring products from leading mints helps ensure long-term resale potential.