Are you considering investing in precious metals like gold and silver?
You’re certainly not alone. A 2019 survey of 1,500 Americans revealed that 12 percent of respondents owned gold while 14 percent owned silver. Tellingly, an overwhelming majority said they don’t own any precious metals.
Investing in Precious Metals
It’s easy to see why. Most Americans prefer investing in the stock market and/or real estate. This isn’t to say precious metals are a bad investment. In fact, there are significant benefits, such as non-existent credit risk and great inflationary protection.
But what do you need to know before you buy precious metals? We’ve got a helpful guide, so keep reading:
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What do precious metals have in common?
Well, they’re all precious, meaning they have an intrinsic value. That’s just about where the similarities end. Some precious metals, like gold and silver, are way more precious/valuable than others, such as platinum and palladium.
With greater value comes a greater cost. This means gold is going to cost way more than silver and other precious metals. Also, some metals have more demand than others.
When you’re looking to invest in precious metals, appreciate the fact that they aren’t all the same. An investor who owns gold might be in a better position to liquidate their investment than someone who owns platinum. When you have this knowledge, it’s easier to choose the best metal to invest in based on your investment needs.
Understand How the Market Works
To make a profit investing in precious metals, you have to obey one universal investment principle: buy low, sell high.
You want to buy a precious metal when you believe its market prices are at the lowest and wait for them to climb. This way, you can exit at a high and make a good killing.
This is why it’s super essential to understand how the precious metals market works. What forces influence the price of various metals, for instance? Is it a bull market or a bear market?
Understanding the market enables you to make an informed investment decision.
Pick a Form of Investing
As a precious metal newbie, what first comes to mind is a physical metal. Want to buy gold? You want a physical gold bar.
You’re not wrong. You can buy physical precious metal and keep it in a safe. This is the old-fashioned way of investing in precious metals and it still works today.
However, it isn’t the only way. You can invest in precious metal stocks. This involves buying shares in companies that mine the metal you want to invest in.
You can also invest in an exchange-traded fund (ETF), which is a security on the investment.
This brings us to another important thing you need to know: where to buy your precious metals. There are metal dealers with physical stores, but the most effective way to buy is in an online exchange, such as Investor Crate. With Investor Crate Plus membership, for example, you can easily buy the precious metal of your choice and gain access to sweet deals.
Investing in Precious Metals Has Big Rewards
Investing in precious metals is a smart decision. However, you don’t just walk into a shop and snap up your gold bars. There’s vast information you need to know before making the dive and this article has given you the crucial bits.
Stay on our blog to keep learning more about how to invest in precious metals and more!