Reddit can be a useful source of investment advice on various topics, including how to invest in gold. With many investing subreddits and thousands of users sharing their strategies, redditors have provided tons of tips for buying physical gold, gold ETFs, gold mining stocks, etc. However, Reddit content should not be blindly trusted and thorough research is still required. This article summarizes key tips for investing in gold found on Reddit.
Buying physical gold and storing securely
Many Reddit posts recommend buying physical gold like coins or bars rather than paper forms of gold. Reasons include: physical gold is a hedge if financial systems fail, it satisfies the human attraction towards tangible assets, it prevents inflation erosion, etc. But storing large amounts of physical gold is highlighted as an issue by redditors. Solutions proposed include: safe deposit boxes, private vaults, home safes, burying gold in the garden, hiding gold prepper style, etc. Overall the consensus seems to be to hold some physical gold coins at home for bartering and some larger amounts in secure vaults.
Choosing low cost gold ETFs
For investors who don’t want the hassle of storing physical gold, buying gold ETFs is a popular reddit recommendation. Advantages highlighted are convenience and ability to invest small amounts. Disadvantages noted are lack of anonymity and dependence on functioning financial systems. Redditors emphasize choosing low cost, physically-backed ETFs from reputable providers. Some popular ETFs often mentioned are: IAU, GLD, SGOL, etc. Overall gold ETFs allow easy investment exposure to gold price movements.
Researching gold mining companies
More risk tolerant investors are advised to research gold mining companies on Reddit as they offer leverage to gold prices. Picking the right mining stocks is key as mining is expensive and complex. Tips include: preferring royalty/streaming companies over explorers/producers, looking for companies with low AISC and debt levels, understanding mining jurisdictions, etc. Some redditors even perform valuation models on miners based on future gold price expectations. Overall gold miners can boost returns but require more research.
Avoiding common gold scams
While investing in gold, redditors also warn about falling prey to gold scams which can deprive investors of their hard earned savings. Recommendations for spotting scams include: avoiding “get rich quick schemes”, only buying from reputable dealers, being wary of high pressure sales tactics, ensuring ability to take physical possession, etc. Redditors also share personal experiences falling for scams to warn others of risks like prepayment without delivery, bait and switch tactics, fake gold bars, etc.
In summary, Reddit provides many suggestions around buying physical gold securely, preferring low cost gold ETFs, carefully selecting gold mining stocks, and avoiding gold scams. But all content should be validated through other credible sources before making investment decisions.