Investing in Gold: A Guide to 7 Simple Ways to Buy Gold

Roughly seven in 10 people invest in some form or another, according to a survey by FinanceBuzz. Investing in gold is an excellent way to diversify your investment portfolio. In general, stocks and gold have an inverse relationship, which means that when the stock market experiences a downturn, gold prices go up, and vice versa.

If you’re thinking about investing in precious metals, here’s what to know about how to buy gold for your portfolio.

In this article

• How to buy gold: What are your options?
• Investing in gold
• Buying physical gold
• FAQs about how to buy gold
• The bottom line

How to buy gold: What are your options?

There are several ways you can buy gold, but they all fall under two umbrellas: investment vehicles and physical gold. Here’s what to know about your options for purchasing this alternative asset.

Investing in gold

Investors can purchase a handful of different securities that allow them to take advantage of gold’s price movements without actually owning the precious metal in its physical form.

Those options include a gold individual retirement account (IRA), gold exchange-traded funds (ETFs), precious metal mutual funds, and gold mining stock.

Invest in a gold IRA

A gold IRA is a type of self-directed individual retirement account that involves investing in and owning actual gold coins and bullion. These accounts are also called precious metals IRAs because you can also invest in other metals, including silver, platinum, and palladium.

You typically need to work with a bank or brokerage firm to manage your account and act as a custodian for the gold you purchase. Then you can buy the actual assets from a precious metals dealer like Gold Alliance.

Although you’ll own physical gold in this retirement account, the actual gold bullion will typically be stored on your behalf with a depository service.

You can open a new gold IRA or roll over an existing retirement plan, such as a 401(k) and other employer-sponsored retirement plans, as well as other individual retirement accounts.

Gold IRAs can offer the chance for investors to hedge against potential stock market volatility. But as with any other investment security, it’s good practice to avoid putting all your eggs in one basket, so you could choose to plan to invest in stocks, bonds, and other options to maintain a diversified portfolio.