How to invest in physical gold? Find out!

How to invest in physical gold? Although since 1971, the currencies in circulation are not linked to gold, the main Central Banks consider investing in gold as the last refuge in case of economic crisis and therefore keep gold in their reserves. According to the WGC (World Gold Council), physical gold outperforms other assets in the preferences of Central Banks seeking to diversify into dollar and euro.

How to invest in physical gold?

There are different alternatives when it comes to buying physical gold: certified physical gold bars or gold coins. A gold coin or gold bar is an insurance against loss of purchasing power and therefore an asset that constitutes a refuge within our portfolio.

Investing in gold bars
gold bars

The weight and dimensions of the physical gold ingots depend on the manufacturer of the ingot, so we find a greater diversity in the choice of ingots. One of the advantages of investing in certified physical gold ingots is that the higher the weight of the ingot, the cheaper the price per gram of physical gold you pay. Normally, the physical gold bars sold are Good Delivery gold bars that meet LBMA standards and weigh 12.5 kilos or 400 ounces.

In addition, it should be noted that the premiums charged on the spot price in ingots are usually lower than for investment gold coins, although they depend on the market situation.

Investing in gold coins

physical gold coinsThe gold coins offer greater security to the investor, since they are minted on both sides. In addition, a gold investment coin has unique characteristics of gross weight, net weight, diameter, width, design and mintage which, in the case of the ingot, are often unknown or not met.

Among the different types of gold coins in which we can invest, there is no coin that can be considered the safest to invest in.

Why invest?

Here are 10 reasons to invest in gold, and specifically in physical gold through gold bars and coins:

    1. The price of gold has been on an upward trend since 2000. Although it has performed badly in the last year, the price of gold has more than quintupled in this 12-year period and has not yet reached 1980 levels (adjusted for inflation).
    2. In the last year, the companies that exploit gold fields have closed the most difficult mines in order to improve their profitability. This will lead to stagnation of world gold production, reducing the available supply of gold.
    3. The price of gold always rises when real rates are low. We are currently in a period of low and even very low interest rates.
    4. Since 2004, the banks have signed the Washington agreements aimed at regulating and limiting sales of the Central Bank's gold reserves.
    5. Demand for gold is constantly increasing, particularly in industry and jewellery. These two sectors account for about 70% of global gold demand and are growing at an annual rate of 5 to 8%.
    6. In times of economic crisis, gold is the safe value par excellence and is therefore an asset that allows us to diversify the portfolios of pension funds and professional investors.

  1. The crisis has made savers and investors aware of the risk of dynamic cash investments. This has led to interest in physical gold to protect our portfolio.
  2. Since 2002, the dollar and the euro have lost no time in losing their value against other currencies. Gold is quoted in dollars, so a fall in the dollar causes an increase in the price of gold. To counter these effects, the Fed must keep interest rates low and therefore the dollar will remain weak.
  3. Gold is the only asset that offers us protection against inflation and deflation.
  4. Physical gold, especially gold bars and coins, is considered by individuals as a wall against crises, and the only fire insurance for our assets.



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