Advice on buying Gold.

[gadgetguy]

I have been thinking of buying some Gold as a long term investment.I have never done so in the past and i'm unsure what would be best to buy either Gold sovereigns or the small Gold bars ? I would probably be looking at around £300 per month but if funds allow i might spend just Over £1000 in a month which would put me in the 1oz Gold Britannia region.

Obviously i dont want anyone to breach their opsec but some advice would be helpful. I have been looking at the Bullion by post site for prices etc.

Thanks GG.

[Brambles]

I'm a sovereign saver myself. Not too big to have to save hard for and easy to sell. Though pm prices are very strong atm Atkinson's are better than bullion by post for gold and silver and Abbots are good for silver

[gadgetguy]

Thanks Brambles i had a look at Aitkins and they are cheaper.

GG

[Vespa]

It might not make too much difference to you but when you sell foreign coins and gold bars Capital Gains Tax should be paid, but CGT isn't payable on British coins so Sovereigns and Britannias are probably the way to go.

[gadgetguy]

It might not make too much difference to you but when you sell foreign coins and gold bars Capital Gains Tax should be paid, but CGT isn't payable on British coins so Sovereigns and Britannias are probably the way to go.

Thanks for that Vespa. I did pick up on that. I think the British coins is the way to go.

GG

[preparedsurrey]

At the risk of a thread hijack, the spot prices thread has got me thinking. I can get my head around buying physical gold and silver but with the spot prices is it just like trading shares - you get a piece of paper electronically and the gold is held elsewhere?

Is there anywhere members could recommend for an example of how to trade on a small scale?

Thank you

[pseudonym]

At the risk of a thread hijack, the spot prices thread has got me thinking. I can get my head around buying physical gold and silver but with the spot prices is it just like trading shares - you get a piece of paper electronically and the gold is held elsewhere?

Is there anywhere members could recommend for an example of how to trade on a small scale?

Thank you

The spot price is what Gold and Silver are selling for at that second. These prices are constantly changing.

All Merchants sell the physical stuff ( Bars or coins) based on that price.

I can't help you on the trading side of it.

As for paper shares, not worth anything in my opinion, if you aren't holding it in your hand you don't own it.

[Vespa]

At the risk of a thread hijack, the spot prices thread has got me thinking. I can get my head around buying physical gold and silver but with the spot prices is it just like trading shares - you get a piece of paper electronically and the gold is held elsewhere?

Is there anywhere members could recommend for an example of how to trade on a small scale?

Thank you

If you are looking to trade paper gold then the easiest way is probably spread betting. IG index is the oldest and originally gold spread betting was the only service they offered.

When ever you sign up for one of these services they give you a warning along the lines of "spread betting is leveraged and you could lose much more than your initial investment", they give this warning for a reason. That reason is that it's true. It's easy to lose money, don't commit any more money than you are truly comfortable losing because when you start you probably will.

A quick search of Amazon will pull a list a books relating to spread betting and gold trading, read the reviews.

[C4tch]

My advice for what it's worth would be to buy UK coins until you build up enough value that you are not comfortable keeping them at home. I would for sure go with UK coins unless you have a collectors interest because of the CGT for billion on hand. Silver coins are tough as they attract VAT if bought from places like Bullion By Post et al. I am too chicken to buy second hand as I worry about fakes. By the way, that £5k 1oz collectors coin will be worth the same as any other coin if the $... does hit the fan so for insurance purposes I would stay clear of those.

You could then open an account with someone like The Real Asset Co. Spreads are much narrower than on coins if you want to trade, as well as way more convenient. You can register the bars once you have enough which I think is the second best option to having them in your house. One thing to consider when starting to buy bars are storage costs. Gold is cheaper than Silver, but both invariably attract minimum storage fees. I did not invest in stored bullion until I had a smaller than 0.5% year storage fee. That means you need some decent funds down on open unfortunately.

I also personally trade ETFs because of the fact that I have an ISA and its by far the easiest way to buy and sell in that. I also trade ETFs in order to build up my physical holdings outside my ISA. Whenever/if I have profits I take them out and convert to either bars or coins. Unless I feel the world is about to implode (getting there!) I think they are very easy and liquid to trade. Spreads are small and fees are acceptable at the levels I invest.

Finally, try to buy on dips (profit taking). I am not wildly worried about where I enter for physical, as for me these things are long holds. With ETFs that obviously changes and its critical to buy on the dips as I would not hold my ETF positions for the long term due to the fact that they really are toilet paper!

Cheers

C

[C4tch]

If you are looking to trade paper gold then the easiest way is probably spread betting.

I would be very careful spread betting if I was not comfortable day trading. You can do some serious damage to your finances if the market turns and you are leveraged. Some spread betting firms offer substantial leverage for gold. You could put down £1k and loose £10k+ depending on leverage. Not great if you are not comfortable loosing that kind of money. Obviously you can also make huge profits from small investments...

Cheers,

C