Gold is one of the simplest assets to invest in. The options are multiple and not at all complicated: investment or bullion coins, ingots of various sizes… There is a whole range of products for different types of customers and their budgets. However, as we have warned on several occasions from our blog, certain precautions should be taken when acquiring precious metals.
The rise in the price of gold, which has increased in value by 14% so far this year , is popularizing this metal as an investment object. Its advantages, which we have already detailed in this blog, are multiple: it maintains purchasing power, protects against inflation, it lacks counterparty risk, it has immediate liquidity at any time and place.
The advantages offered by gold and, above all, the attractive price it is reaching (currently around $1,730 an ounce, its highest level in the last eight years) have aroused the interest of investors and customers in general, concerned about its heritage and due to the economic crisis that is emerging after the Covid-19 pandemic.
For this reason, different specialized media are carrying out didactic work to alert clients who invest for the first time in gold of the necessary precautions they have to adopt.
Some precautions that mean more than applying common sense and prudence to the acquisition of a product of a certain value, as we would do when buying a home or a vehicle. Within this work of training new investors in gold, today we want to bring to this blog the article published by Paul Dykewicz in Townhall Finance , which we consider highly recommended for those who are interested in acquiring gold.
Dykewitz, an analyst with more than 25 years of experience in the precious metals market, has prepared a decalogue on the biggest mistakes that a person who is preparing to acquire gold should avoid. These are her recommendations:
One of the greatest virtues of gold and other precious metals is that they have enormous liquidity, which allows you to quickly recover the money invested in case of need. For this reason, one of the first questions to ask the merchant who is going to sell us the metal is if, if we want to sell it, he will buy it back from us .
If the answer is negative, we must suspect that the merchant is not interested in repurchasing it because he has inflated the sale price and would not recover the difference if he repurchased it at market prices. In addition, the client himself would realize that he has been deceived.
Not being clear about the objective
Just as there are many formulas for acquiring gold and other precious metals, there are also many different reasons for doing so.
Thus, some investors are looking for a way to maintain their wealth, while others are looking to make a profit and the most seasoned trade precious metals based on certain market indicators.
A good merchant will know how to recommend to the client the best formula to achieve his objectives.