Buying and storing investment gold: Some things you need to know
As Shakespeare reminds us: All that glitters is not gold. However, for investors, it’s just as important to know that not all kinds of gold are equally suitable for savings and investment purposes. Many financial experts recommend buying gold. However, they don’t mean the type of gold which is destined for use as an industrial metal or earmarked for the jewellery industry, but gold primarily intended for the investment market. But what exactly is investment gold? What specific benefits does it offer? And where is the best place to buy investment gold and then store your acquired investment after you have made a purchase?
What is investment gold?
Investment gold is physical gold which investors purchase primarily for investment purposes. The defining feature of this particular product is its high gold content, which is what distinguishes investment gold from all other gold products. Investment gold must have a purity of at least 900/1000 for gold coins, and at least 995/1000 for bullion bars.
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What advantages can investment gold offer?
According to many financial market experts, investment gold offers investors several advantages, making it a popular form of investment. The benefits most frequently mentioned include:
- Inflation protection: Gold is often viewed as a hedge against inflation. Over time it has been shown that the value of gold often increases whenever the purchasing power of currency declines.
- Value proposition: Historically, gold has retained or even increased its value over long periods of time. Not only is gold a physical asset, it is also a durable precious metal which won’t weather or decay, making it a permanent store of wealth.
- Crisis resistance: During times of serious political and economic instability, gold prices tend to rise as investors turn to gold as a “safe haven” investment.
- Diversification: Including gold in any investment portfolio can help to diversify and thus reduce the overall exposure to risk for individual portfolio assets. Gold frequently, but not invariably, exhibits a low or even negative correlation to other asset classes such as stocks and bonds. This means its price movements are relatively independent.
- Liquidity: The value of gold is recognised worldwide, which means it can be converted into cash relatively easily. Investment gold has a particularly high liquidity because it is issued in standard formats such as bars and coins.
- Anonymity: Physical gold can be purchased anonymously under certain conditions, making it attractive to those investors who especially value discretion and privacy.
- Tax advantages: In many countries, investment gold enjoys particular tax advantages. In Switzerland and the European Union, for instance, this includes exemption from VAT. Such features make investment gold a particularly tax-efficient form of investment.
What are the different types of investment gold?
Gold bullion bars are a popular way to buy investment gold. They are usually produced by pouring fine melted gold granules into ingot moulds, or else by pressing out bars from previously rolled sheets of fine gold. Standard commercial sizes range from tiny one-gram bars up to gold bars weighing several kilograms. Tablet bars (also known as combination bars) are a more recent gold-bar variant. These are designed rather like a bar of chocolate, and thus consist of several smaller gold bars connected to each other but with predetermined breaking points. Individual pieces can thus be flexibly separated as and when required. This feature allows gold sections to be broken off and sold without any loss of material. Gold coins minted after 1800 are also commonly used as investment gold. Here too, there are different sizes and weights, with a 31.1035 gram troy ounce of gold having established itself as the de-facto standard. Some popular gold investment coins include:
| Gold coin | Country | Fineness | First minted | Weights options in troy ounces | Trivia |
|---|---|---|---|---|---|
|
US
|
916,7
|
1986
|
1, 1/2, 1/4, 1/10 oz
|
|
|
|
AU |
999,9
|
1986
|
10, 2, 1, 1/2, 1/4, 1/10, 1/20 oz and 1 kg
|
The world’s largest coin is the Australian Kangaroo produced in 2011 with a weight of around 1 tonne. |
|
|
Aus. Koala
|
AU
|
999,9
|
2007
|
2, 1, 1/2, 1/4, 1/10, 1/25 oz
|
|
|
GB
|
999,9 (bis 2012 917,0)
|
1987
|
5, 1, 1/2, 1/4, 1/10, 1/20 oz
|
|
|
|
CN
|
999,0
|
1982
|
1, 1/2, 1/4, 1/10, 1/20 oz and 1g, 3g, 8g, 15g, 30g
|
|
|
|
CH
|
900,0
|
1897
|
2,903 g, 5,807 g , 29,032 g |
|
|
|
Helvetia |
CH
|
900,0
|
1883
|
5,807 g
|
|
|
ZA
|
916,6
|
1967
|
50, 5, 1, 1/2, 1/4, 1/10, 1/20, 1/50 oz
|
|
|
|
MX
|
999,0
|
1981
|
1981
1, 1/2, 1/4, 1/10, 1/20 oz
|
|
|
|
AU
|
999,9
|
1996
|
10, 2, 1, 1/2, 1/4, 1/10, 1/20 oz and 10, 1 kg
|
|
|
|
CA
|
999,9 (bis 1981 999,0)
|
1979
|
1, 1/2, 1/4, 1/10, 1/15, 1/20 oz
|
5 pieces of the 100 kg Big Maple Leaf were produced in 2007. One of them was later stolen from the Bodemuseum in Germany. |
|
|
UK
|
916,7
|
1817
|
36,61 g, 14,64 g, 7,322381 g, 3,661 g
|
|
|
|
Wiener Philharmoniker
|
AT |
999,9
|
1989
|
1, 1/2, 1/4, 1/10, 1/25 oz |
The Big Phil is a 1000 oz (31.103 kg) version of the Philharmonic produced in 2004. |
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How and where to purchase investment gold
If you wish to buy investment gold, you should make sure to do so from a trustworthy and experienced trader rather than looking for dubious bargains. This strategy is far more likely to bring would-be buyers the opportunity to secure genuine high-quality investment gold of the quality advertised. It’s also important to see a broad range of products, while attractive pricing and convenient purchasing options are also desirable features. One recommended trading partner offering all of these attributes is Echtgeld AG. This Swiss company has been trading since 2010 and specialises in supplying physical precious metals. Investors can purchase both gold bars and tablet bars in different sizes. In addition, Edelmetall AG is a Swiss precious-metal trading company stocking practically all of the most important gold investment coins at affordable prices. Customers will also find their sales process extremely straightforward.
How and where to store your investment gold
Buying investment gold also creates a practical need to store your newly acquired investment. There are a number of available options, but relatively few that are actually recommended. Home storage is one possible solution, but this usually comes at the expense of adequate security. After all, who can set up a sophisticated security installation in a home environment? And if such facilities cannot be provided, then an insurer would be unlikely to pay up in the event of a theft claim. Many banks and building societies also provide safe deposit box facilities in which customers can also arrange to store their investment gold. However, this too often has several disadvantages. In addition to the relatively high costs, a customer must also forfeit their anonymity – which thus means they are denied one of the core advantages of investment gold. Banks in the EU, for example, must automatically report the names of all safe deposit box holders to the respective central tax authority. And furthermore, if you wish to use a bank safe deposit box, you almost always have to open an account at the same bank. In addition, many banks no longer consider safe deposit box facilities to be part of their core business, which means their respective security installations are often outdated. As such, the provision on offer may not be up to the minimum standard required to securely store assets like investment gold. Thus your investment gold bars and coins are best entrusted to the safekeeping of a specialist provider such as Swiss Gold Safe. Not only can they provide easily accessible high-security storage facilities protected by an independent emergency power supply, but your investment gold holdings will also have comprehensive insurance protection.
As well as safe deposit box facilities, Swiss Gold Safe also offer the advantage of allocated & segregated storage, an arrangement which guarantees clients receive back precisely the same items they deposited into storage. All items are uniquely identified via bar and/or seal numbers and stored entirely separate from the precious metal holdings stored by other investors. This service is available to Swiss Gold Safe clients from all over the world because they do not have to be physically present in Switzerland to arrange storage and retrieval. At the same time, clients are assured their instructions will always be managed with legendary Swiss discretion. By arrangement with Echtgeld AG, clients can also have their investment gold purchases delivered direct to the Swiss Gold Safe high-security warehouse.
Are you planning to buy investment gold? Then choose Echtgeld AG, our experienced and trustworthy trading partner who can offer you an extensive range of different types of investment gold in a variety of denominations. Once you have decided upon your purchase, choose Swiss Gold Safe as your storage provider so you won’t have to compromise on security, discretion and the convenient management of your investment gold holdings.
Investment gold
- Investment gold involves an investment in physical gold precious metal with a high degree of purity.
- Investment gold can act as a hedge against inflation, preserve asset values, provide a diverse portfolio, and offer high liquidity.
- Popular forms of investment gold include gold bars and tablet bars as well as particular gold coins such as the American Eagle, Krugerrand, Maple Leaf and Vienna Philharmonic.
- Echtgeld AG is an experienced, reliable specialist source for purchasing investment gold.
- And for the secure, discreet and ultra-convenient storage of investment gold in allocated & segregated custody, we would recommend a specialist provider in Switzerland such as Swiss Gold Safe.
