How to Buy Gold For Investment Purposes

When considering gold as an investment, purchasing an ETF is one option.

It used to be very difficult to buy gold as an investment unless you possessed many thousands of dollars and were comfortable with the logistics of physically holding gold. While it's still possible to buy gold bullion today, there are many exchange-traded funds (an investment fund that holds assets and can be traded like a stock, also called an ETF) whose goal is to closely mimic the price of gold. These funds can be purchased by retail investors and provide a good investment option.

Instructions

Buying a Gold-tracking ETF

1. Open an online brokerage account if you don't already have one.

2. Decide which gold-tracking ETF you wish to purchase. Your brokerage will provide you with tools you can use to research various gold-tracking ETFs. ETFs may track gold in different ways--some take advantage of futures contracts and others will actually hold physical gold bullion. Take note of each fund's expenses and investment objectives.

3. Load your brokerage's "Trade" page. Enter the ETF's symbol, the quantity that you wish to purchase, and select "Buy." As long as you make a market order and you're trading during normal business hours your transaction should be processed almost instantaneously. You'll now own part of a fund whose share price will move in close correlation to the actual price of gold.

Purchaing Gold Bullion

1. Locate a precious metals dealer--these can be found locally or online.

2. Purchase the type and quantity of gold bullion you wish to own. Gold bullion can be in the form of coins or bars in various sizes.

3. Arrange to have your gold bullion stored. A good storage option is a safe deposit box held at a bank.

References

• ETF Database: The Definitive Gold ETF Guide
• The United States Mint: American Gold Eagle Bullion Coins
• Gold Why: Why Store Gold Coins and Bullion Safely?