It is a commonly known fact that the ultimate hedge against inflation has and probably will always be precious metals, particularly gold. The best way or approach towards investing in gold is also (hands down) ownership of the physical metal itself while mutual funds or mining stock do provide a little hedge, nothing can be compared to owning gold bars on your person. As it provides the most direct counter to the dollar if the dollar was to fall, which it will not too long from now, judging from the way things are transpiring. This is so due to the fact that when the dollar falls, the value or price of gold will inevitably rise and at that point in time buying gold would not only be counterproductive, but plain foolish as the prices will rise quickly and without warning. According to Dailyreckoning.com, the dollar is on a self destruct path faster than most other currencies as the finance of the US economy is being raised on debts. However there are ways to position portfolios in a manner that lowers risk levels and increase real potential for profits in time to come – in a long time to come.
It is becoming more evident that the future growth of economies will be based on gold bullion stocks as the world economy will inevitably head back towards the gold standard. However how you invest in gold bullion besides purchasing physical gold is an entirely different matter, it all comes down to your level of market expertise or experience as the more familiar you are with gold related derivatives the better you will be able to handle the case scenarios that would present themselves.
Direct ownership is the best way to own gold bullion it is without any doubt the ultimate expression of pure value. As most of us already know civilizations over the eons have recognized the permanence of gold’s value to an extent where great wars were fought for the sole purpose of pillaging stores of gold. The reason for it simple – Gold, silver and other precious metals are the only real money that has value which cannot be manipulated or controlled by any faction, including governments. If gold bars do not appeal to you other forms of gold bullion include gold coins such as the South African Krugerrands, Canadian Maple Leafs, or American Eagles. Other forms of gold bullion investments that could be considered but not recommended unless you have a good grasp of trading is Gold exchange-traded funds or more commonly known as ETFs. In recent times exchange traded funds have become popular as they provide an interesting way to invest in gold. In essence they are similar to mutual funds that trades trade in the stock exchange like an ordinary share. However an ETF’s portfolio is fixed and does not change.
Gold mutual funds on the other hand are more suitable for those who are not too keen to invest in physical gold, but still want a piece of the precious metal industry action. They are good for diversifying portfolios. For more on ETFs and Gold Mutual funds visit: http://www.nasdaq.com/etfs/what-are-ETFs.aspx