Why Buy Gold Bars [UPD]
Although inflation soared in 2022, gold prices actually declined for most of the year, driven in part by the strength of the U.S. dollar against other currencies. However, with inflation remaining at persistently high levels alongside concerns about a potential recession, gold prices ticked higher in the final months of 2022 and early in 2023.
why buy gold bars
There are many reasons to consider adding gold holdings to your investment portfolio. The precious metal has a history of maintaining its value, making gold a useful hedge against inflation. Gold prices tend to increase when the U.S. dollar is underperforming or during times of economic and political uncertainty. Finally, gold can provide an important level of diversification to your portfolio, as gold prices have historically shown a negative correlation with other asset classes.
There are many vehicles for adding investment exposure to gold. It is possible to own the physical metal in forms such as bullion, coins, or jewelry, although storing and insuring physical gold assets can be costly. Other possibilities include investing in a gold exchange-traded fund (ETF) or buying shares in mining companies that engage in the extraction and production of the precious metal.
There are two main methods of investing in gold: paper and physical. Paper gold is for portfolio protection, used to diversify portfolios, which usually brings balance in times of market uncertainty. Physical gold is to protect your purchasing power, or as discussed earlier, to lock in your purchasing power.
When investors are ready to cash out their investment, they must also consider the liquidation process. Liquidating physical gold and silver may require shipping the metals to a reputable dealer. If the dealer you purchased from does not offer a buyback program, you will have to find another to purchase your metals.
Lastly, investors must remember there is always risk. While we can use historical trends to track the performance of precious metals, we cannot guarantee they will result in a positive return on investment. Like any other investment, precious metals could go down in value. Though its historical performance has shown it to be one of the safest investments, there is still some level of risk. Investors should fully consider all these aspects before committing to gold.
Gold bars are commonly refined into two different types of bars. Cast gold bars are simpler products which are made through a simple process. Most cast gold bars have only a refinery logo stamped onto the surface and come with the most important markings: weight, purity, and metal content. A cast gold bar is produced by melting gold in a large vat and then pouring it into prefabricated molds which are designed to ensure the proper weight and purity for the desired final product. The bars are then left to air cool in the molds or dropped into cold water to speed up the cooling process.
Minted ingots are made with a more refined process. All minted gold ingots start out as long cast bars which are fed into a stamping press. This press is computer controlled and stamps (cuts) the minted ingots to a desired size and shape, and then continues along the press production line to have an image engraved onto the bars. These bars typically have brilliant visual finishes, more intricate design elements, and sharp edges.
As you might imagine, the complication of the production process results in varying premiums for these gold products. Generally speaking, cast gold bars are more affordable with a lower premium over the spot price of gold than minted ingots.
Beyond the size, shape, and style of the gold bars available to you from JM Bullion, you can expect a few commonalities among the bars offered. The vast majority of gold bars today are refined with .9999 pure gold content regardless of weight or type (cast vs. minted ingot). Minted ingots are originally available in most cases housed inside of tamper-evident protective packaging and come with an assay card that verifies the weight, purity, and metal content of the product as judged by a certified assayer. In most cases, gold bars also have a unique serial number issued by the refiner. When bars are available with a serial number and assay card, that card will also reflect the individual serial number as engraved onto the surface of the bar.
Coins typically have lower gold content than gold bars. A one-ounce American Eagle coin, for instance, is only 91.67% gold. In fact, the coin weighs 1.1 ounces, approximately one ounce of which is pure gold; the rest of the weight is silver and copper.
Rather than investing in a single company tied to gold, you invest in a basket of gold-related securities through gold mutual funds or ETFs. Gold funds may track the price of gold, include the stocks of multiple gold mines and refineries or provide exposure to gold futures and options.
For investors willing to take on more risk, futures and options may be attractive. (If neither of those words means anything to you already, you should probably avoid these gold investments for now as they are highly speculative.)
With gold futures, you commit to buy or sell gold in the future at a specified price. Under a gold options contract, you have an agreement with the option to buy or sell gold if it reaches a certain price by a predetermined date.
Gold bars are produced in various sizes and are available at many price points. Choose from bars ranging from 1 ounce to 1 kilo, depending on your budget, personal preferences, storage capabilities, and holding strategy.
Unlike some gold coins, gold bars are typically not produced with special designs that majorly impact the bar's market value. They are, however, produced with identifying marks that provide information about the bar's producer, weight and gold purity, and sometimes a serial number.
Consider how and where you will store and protect your gold. Gold bars require less space than coins to store the same number of ounces, which can make them easy to keep at home. You could also store your bars in a bank safe deposit box or at a facility that specializes in gold storage and protection.
How and where you store your gold bars will partly depend on your financial goals. Do you plan on holding them as a means of protecting your savings until your children are grown, or as a means of emergency financial assistance? If it's the latter, you may want to consider storing your gold close to home, as a bank or storage facility may have limited hours of operation or be located far away. In an emergency, your gold could be inaccessible. Mitigate risk by making accommodations for storing and protecting your gold bars before taking possession of them.
Shop with a local dealer and you could walk away with gold bars almost instantly. While instant gratification often feels satisfying, it can come at a price. Will you be able to comparison shop and evaluate all of your product and price options side-by-side? Comparison shopping over time and across products is one of the best ways to help decide where to buy gold bars.
A: According to Forbes, the risk of buying a counterfeit gold bar or coin is minimal. That said, ways to better avoid counterfeit products include sticking to well-known sovereign coins like Gold American Eagles and Gold Canadian Maple Leafs or bars produced by government mints or London Bullion Market (LBMA)-approved mints and refineries, as the authenticity of these bars is guaranteed.
When you want a cost-effective and convenient way to hold large volumes of precious metals, consider buying gold bullion bars. The principles behind holding gold bars are very similar to those of gold bullion coins. The market value of each corresponds to the amount of gold and to gold's current market price.
You can generally store gold bars how and where you want to. Gold bars are compact, durable, and portable. They can be stacked vertically or arranged side by side, with or without protective packaging. A gold bar can also take up less space than the same weight in coins, depending on the type of coin and your storage method.
Premiums on gold bars tend to be lower than on gold coins of the same weight and fineness. This is due primarily to production costs. Factors that go into the price of gold coins can include an emphasis on appearance, condition, and intricate design, all of which lead to higher machining and labor costs than gold bars.
Most importantly, however, gold bars are great for high-volume gold diversification. That's what they're made for! Due to their size and simplicity, gold bars are one of the fastest ways to build your precious metals portfolio. Buying gold bars can be your fastest route to large-scale gold ownership when time is of the essence.
Call U.S. Money Reserve to learn how you can incorporate IRA-approved gold bars into an existing Self-Directed Precious Metals IRA or how to set one up through U.S. Money Reserve's Gold Standard IRA program. Build your retirement dreams on a foundation of gold bars to help keep you on track.
You can buy gold bars over the phone or online through U.S. Money Reserve's website. We carry gold bars from only the most established government mints and trusted private mints in the world, including the Perth Mint, Royal Canadian Mint, PAMP Suisse, Asahi, and more. Our gold bars for sale are .9999 pure gold and produced in sizes ranging from the affordable 1 oz. to 1 kilo, with plenty of sizes in between.
There are plenty of great reasons to invest in precious metals and gold bars are no exception. As with any investment, there are both advantages and drawbacks to consider. If you are considering whether or not gold bars are a good investment, it helps to lay out some of the pros and cons so you can make an informed decision.
Like silver bars, gold bars are a popular investment that comes in a variety of weights and sizes that appeal to novice and serious investors alike. Because bars require less processing than minting coins, the premiums paid on gold bars are often a smaller percentage than gold coins. Gold bars are also easy to liquidate when you need cash. 041b061a72