What Is The Best Way To Invest In Gold?

bracke

Experienced member
1,286 12
IF the dollar continues to decline there is a good chance that the price of gold will rise.

IF Mr Greenspan is forced to raise interest rates the dollar will strengthen but the value of shares will drop. Would this be good or bad for the price of gold?

Which is the best method of investing in gold assuming that one does not want to hold it in the physical state or buy goldmine shares?

Regards

bracke
 

anley

Senior member
2,730 229
There is a new gold holding stock in London but I don't know its name. Do a search under Gold ETF and you might find something.

Basically as people buy the share the management buy and store physical gold. So the share is backed by cash gold and is not margined etc. This is by far the best and easiest way.

However if you've got a long term view on it why not buy it using a spread bet then your profit is tax free. I've been holding gold like this since last summer and I just bought silver last week. If gold stays strong then I plan to hold these positions possibly for many months if not years.
 

2468steve

Experienced member
1,076 39
bracke,anley
the ETF is Gold Bullion Services with ticker GBS.This,as you correctly say is quoted on London market.
A similar equity is avaliable if you have access to the US markets and this is The Central Fund of Canada (CEF).This i believe is a better alternative as this fund also only invests in the actual metal itself,but in this case silver as well as gold.At present i believe their assets are weighted 60% silver,35% gold,5%cash.
To get a better look try this link
http://www.centralfund.com/

hope this helps
 

CityTrader

Established member
665 26
Gold..

.. is generally considered to be a safe haven- in times of war, high inflation or weak usd. Perhaps a SB would be the best way for you to "invest" ?
 

donaldduke

Experienced member
1,665 257
SB is tax free, so if you use up all your CGT allowance
on other gains or you think your profits will be huge you might
want to go SB. It only thing is that because the contracts expire
you will have to roll them over..
The leverage of SB also means you only need a fraction in
your account, while an ETF the margin requirements would
be higher, the rest of your money could be invested elsewhere
or earning interest..
 

anley

Senior member
2,730 229
Why not buy the ETF for investment in Gold and the Spread Bet for speculation, say 80%/20%?
 

bracke

Experienced member
1,286 12
To Those Who Replied

Thank you for the information you all provided it was just what I was after.

If I decide to go the SB route am I best advised to buy the future which is further away (currently June) in order to give myself leeway for the price to rise?

As I would probably maintain the bet for several months what would be the cost of rolling the bet over each contract period, it is not something I have done before.

Regards

bracke
 

TWI

Senior member
2,531 252
via some SB's certainly with CMC you can buy a cash contract which avioids paying possible contango as with futures roll-over.
 

anley

Senior member
2,730 229
Buying the June would be the right thing to do, as for costs don't worry about it, maybe about $0.50 each time.
 

bracke

Experienced member
1,286 12
anley

Thank you for your information.

Regards

bracke
 

PeterTT

Member
87 1
twalker .. great but you have to pay CMCs "generous" funding costs (adjusting your purchase price upwards everyday) .. think it is around about 6 1/2 pct annualised ? But if you sell short you do get a small benefit ...........
 

bracke

Experienced member
1,286 12
twalker

I have just read the gold-eagle article by Richard Russell and similar to other contrarians ( www.zealllc.com ) he makes a good case for gold and provides good reasons why the dow is overvalued and going through a bear market rally rather than a new bull market.

But he also points out that no matter what you may think, even though you may be correct "You'll lose your money simply because you're at odds with the market".

The market, irrational or otherwise, rules but sooner or later valuations eventually come home to roost and then its look out above or in the current scenario look out below.

Regards

bracke
 

ZigZag

Active member
123 0
bracke: Seek out and woo a rich woman. Then buy a gold ring. Ensure you calculate a risk/reward ratio.
 

bracke

Experienced member
1,286 12
ZigZag

Thank you for your advice but that wasn't exactly what I was thinking about when I was requesting information relating to investing in gold.

Whilst there may be some merit in your suggestion it means I relinquish control of my asset plus the arrangement is a little to permanent for my liking.

Regards

bracke
 
 
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