Investing in gold in Singapore has become increasingly popular in recent years. With rising economic uncertainty, many Singaporeans are looking to diversify their assets and hedge against risks. Gold is seen as a safe haven asset that can provide stability during volatile markets. However, getting started with gold investment can be daunting for beginners. The high upfront costs and confusing products/services often deter new investors. This article provides a comprehensive guide to free gold investment options in Singapore. It covers the basics of gold investment, analysis of popular free products like ABSDA and Gold Dinar, as well as tips for novice investors.
Overview of gold investment and its benefits
Gold has been a store of value for thousands of years. Its key benefits as an investment asset include:
– Hedge against inflation – Gold prices often rise when inflation is high, protecting purchasing power. This makes it useful for wealth preservation.
– Portfolio diversification – Gold prices generally move independently of stocks and bonds. Adding gold to a portfolio can lower overall risk through diversification.
– Liquidity – Gold is highly liquid and can be easily bought/sold in markets across the world. This allows investors to enter or exit positions efficiently.
– Safe haven appeal – During times of geopolitical or economic crises, gold prices often surge as investors seek safety. This provides crisis protection in turbulent times.
– Tangible asset – As a physical asset, gold is free from counterparty risk that affects financial instruments like bonds/stocks. This unique characteristic appeals to certain investors.
Popular free gold investment options in Singapore
While buying physical gold bullion is the most direct investment method, it requires high upfront capital. For investors new to gold, free investment schemes are a good starting point. Two popular options are:
– ABSDA – The Asia Bullion Silver Dollar Account offers investors a way to own gold/silver at no cost. Customers deposit fiat money, which ABSDA uses to buy and store bullion on your behalf. The customer owns a fractional share of the total pooled bullion. There are no account fees, annual fees or commission charges.
– Gold Dinar – Offered by companies like Safe Gold Investments, Gold Dinar allows investors to buy and sell tokenized gold at no charge. The gold is stored by Safe Gold in their certified vaults. 1 Dinar represents 1 gram of gold. With low entry requirements, it offers easy access to gold investment.
These free products remove the high barrier to gold investment faced by novice investors. The gold is fully allocated and can be exchanged for physical gold through redemption if desired later on.
Tips for beginners looking to invest in gold in Singapore
Here are some tips for those new to gold investment:
– Start small – When beginning, invest only a small portion of assets into gold for portfolio diversification. 5-10% allocation is generally recommended.
– Dollar cost average – Rather than buying a lump sum upfront, take a disciplined approach of regular small buys to lower risk.
– Storage and insurance – For physical gold, ensure proper insured storage arrangements are in place for security. Reputable providers like Silver Bullion offer such facilities.
– Avoid complex products – Leveraged and futures gold products carry risks unsuitable for most retail investors. Stick to simpler allocated products first.
– Long-term view – Gold prices can be volatile in the short-term. Take a long-term approach and avoid panic buying/selling during price swings.
– End goal – Be clear on why you are buying gold. Is it a short-term speculation or long-term wealth preservation? Different goals dictate different approaches.
Investing in gold in Singapore has many benefits but can seem daunting for novices. However, free investment schemes like ABSDA and Gold Dinar have lowered entry barriers significantly. They allow investors to get started in gold at zero cost. Combine these products with sound strategies like dollar cost averaging, small initial allocation and long-term holding to become a successful gold investor.