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How to buy bullion in New Zealand
Bullion can be a stable investment in times of uncertainty — find out how to add precious metals to your portfolio, and which dealers you can buy it from.
In uncertain and volatile economic times, precious metals like gold and silver are often seen as a safe haven. If you’re looking for a stable investment that doesn’t experience the same fluctuations as other financial products, you may want to consider buying bullion.
This guide examines what bullion is, how and where you can buy it, and why it’s worth considering as an investment.
What is bullion?
Bullion is a bulk quantity of gold, silver or another precious metal. Typically kept as bars or ingots or coins, bullion must be at least 99.5% pure.
While central banks in countries around the world often hold reserves of bullion, it’s also available for purchase by everyday investors.
What types of bullion are there?
Mention the word “bullion” and most people immediately picture a bank vault full of gleaming gold bars. But there are several different types of bullion available to investors.
Gold is the most popular form of bullion and is widely available, while silver is also available for purchase from many bullion dealers. However, a smaller number of dealers stock bullion of other precious metals, including platinum and palladium.
The physical form of bullion can also differ. Bars and ingots are the most recognisable variety, but bullion coins are also available as a convenient option for investors looking to purchase a smaller amount of precious metal.
Is bullion a good investment?
Just like any other type of investment, buying bullion comes with a range of risks and benefits.
Pros of buying bullion
The biggest attraction of bullion for many investors is that it offers protection and security in times of economic uncertainty. While fiat currencies issued by governments can fall in value during uncertain times, bullion (particularly gold) is seen as a reasonably safe store of value.
Bullion can therefore help you hedge against market risks. It’s also seen as a long-term investment, and doesn’t require the same sort of constant market monitoring and regular trading as some other investment types.
Finally, some investors also like the appeal of buying a tangible physical asset. Unlike some other financial products where you don’t actually own any precious metals, buying bullion allows you to take possession of a physical asset.
Cons of buying bullion
But there are also downsides to buying bullion. The main potential drawback is that bullion may not offer the same high returns as some other financial products, such as shares, which are subject to higher volatility.
It’s also important to be aware that different factors affect the price of different types of bullion, so don’t expect silver to mirror the performance of gold or vice versa.
Next, you’ll need to take fees and costs into consideration. Dealer commissions and delivery fees apply, while you’ll also need to consider the cost of storing and insuring your investment. Finding secure storage can also be inconvenient, but it’s the price you pay for owning a physical asset.
Finally, another drawback worth considering is that bullion doesn’t provide an ongoing source of income. This may make investments like property and shares, which allow you to receive rental income and dividends respectively, a more attractive option.
How do I buy bullion?
There are many bullion dealers that allow you to buy bullion in New Zealand online. Of course, before you buy, you’ll need to do your research to confirm that you’re purchasing from a reputable dealer. It’s also important to check whether the full value of your bullion will be insured during shipping.
The buying process varies slightly between dealers but typically involves the following steps:
- Browse a dealer’s bullion products online.
- Compare the dealer’s price to the current spot price for the metal you’re buying.
- Add the bullion you want to buy to your shopping cart.
- Provide your name, contact information and billing address.
- Enter your payment details. Payment options vary between dealers but include bank deposits, credit cards and PayPal.
- Your order will then be shipped to you or made available for collection.
Of course, you also have the option of buying bullion in-store. This will help you save on delivery fees, but means you’ll need to deal with transporting the bullion yourself.
Where can I buy bullion in New Zealand?
If you’d like to invest in bullion, here’s a small selection of providers where you can buy gold, silver and other precious metals:
- New Zealand Mint. Based in Auckland, New Zealand Mint is the country’s only precious metals mint and stocks gold, silver and platinum bullion.
- Buy Bullion. Headquartered in Dunedin and with locations in Christchurch and Wellington, Buy Bullion sells gold and silver bullion.
- New Zealand Gold Merchants. New Zealand Gold Merchants manufactures its own NZ Pure bullion brand and stocks the Pamp Suisse bullion range.
- MyGold. Located in Auckland, MyGold stocks a wide range of gold and silver bullion products.
- Silver Gold Bull. Stocking silver, gold, platinum and palladium products, Silver Gold Bull offers 24/7 online ordering.
- Bullion Deals. This independent gold and silver bullion dealer was established in New Zealand but has since expanded into Australia and the UK.
- Gold Survival Guide. This platform started out as an education site for precious metals investors but now also sells gold and silver bullion.
- BullionStar. BullionStar stocks gold, silver and platinum products and offers shipping via courier or personal pick-up in Wellington.
The bottom line
If you’re searching for a stable, long-term investment, there are plenty of good reasons to consider buying bullion.
However, it’s also worth mentioning that there are other ways to gain exposure to gold and silver, such as investing in an exchange-traded fund (ETF), and it’s important to be aware of the risks involved with bullion before you buy. See our guides on how to invest in gold and how to invest in silver.
Ultimately, you’ll need to weigh the pros and cons of buying bullion to decide whether it’s the right investment for you.