As a South Asian, I’ve always been a fan of gold as an investment.
Why Invest In Gold?
If offers excellent diversification benefits – gold is one of the few assets that which has a negative correlation with shares during market downturns. Having multiple assets with different correlations helps minimise risk in your portfolio, increasing future investment returns. Gold is not an investment for everyone, so do your own research to decide if it is right for you!
How to Invest In Gold?
1. Purchasing Physical Gold
There is something about feeling, touching and holding your investment. You can purchase gold bars, coins and other items over the counter in many gold and jewellery stores. If you own gold jewellery, you can use your investments while still holding them in your portfolio. These are a non-volatile and defensive asset, great for minimising risk in a portfolio. As you can’t check what the exact value of the investment is constantly, investors who fear market fluctuations and price drops can be more at ease.
However, there are many restraints with owning gold in this manner. It needs to be stored securely such as in a safe, needs to be insured and more. These costs can detract from the overall returns and it is not the most “convenient” of investments. That being said, I personally am still a big fan of this type of investment.
2. Buying into a Gold ETF
This is kind of like buying gold shares, but very easy, more diversified and cost effective. You don’t physically own any gold, but rather buy shares in a “gold fund”. This option is great as it removes a lot of the obstacles of owning gold, while giving the same returns and diversification benefits. The largest gold ETF in Australia is called…GOLD! You can read up about it here https://bit.ly/3dGHrex
If you are unsure on how to actually buy shares in a Gold ETF, I have a guide on how to buy shares, click here. If you wanted to invest money in GOLD for example, that is the code you would input when you are making your trade.
If you have any questions, please send me a DM on insta @themoneymarketerblog or send me an email on firstname.lastname@example.org!