ETFs vs. Physical MetalAmericans tend to prefer investing in gold and silver exchange-traded funds, or ETFs, as opposed to the physical metals. ETFs are stocks traded on the market that are backed and valuated by the price of its respective commodity. In other words, you will own a piece of paper saying you have x-number of gold shares and y-number of silver shares. Owning the actual gold and silver gives you physical possession of your investment, which can even be used as collateral on a low-interest loan to startup your business. Gold and silver dealers, such as US Money Reserve, sell bullion in the form of coins and bars at real-time prices based on market fluctuations. This gold can then be stored either in a safe-deposit box or a fire-proof safe tucked neatly away in your home.
Saving With Gold and SilverIn 2003, the price of gold was about $300 an ounce, while silver sold for less than $4. Today gold hovers around the $1,700 per ounce mark, while silver is traded at $32 per ounce. In other words, had you deposited $2,000 into a savings account in 2003 with a 3 percent compound interest rate (this is being generous), your yield today would be about $2,650. Had that same $2,000 been used to buy seven, one-ounce gold coins in 2003, today you could sell them for almost $12,000. Many experts in the gold industry, including Euro-Pacific Capital, Inc. CEO Peter Schiff, are anticipating another spike in gold prices similar to that of the past decade. Gold and silver are excellent insurance policies and are guaranteed to retain their value.
Selling Your MetalsInvestors in gold frequently watch the daily fluctuations in its price and decide whether to buy or sell. When you're ready to turn your gold coins into the cash needed to start your business, find a reputable dealer who buys bullion. They should offer you 90 percent of the current price of gold. The places to avoid are corner stores with large "We Buy Gold" signs and the loud television commercials encouraging you to send your bullion to them. Pawn shops are also places to avoid when selling.
Authored By: Madeleine Berry Still a consultant for hedge-fund investors, Madeleine believes that there are many other business endeavors that one can invest in, outside of military spending. She tells her clients to follow their heart and the money will follow.