A complete guide to buying, selling and investing in gold

Learn more about gold, why it is seen as 'safe', and how you can invest today.

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All investing should be regarded as longer term. The value of your investments can go up and down, and you may get back less than you invest.
For centuries, gold has been a popular store of wealth. In turbulent times, you might notice people talking about gold as an investment.

How to invest in gold

There are three main routes to investing in gold:

1. Buy gold mining stocks

One option is to invest in gold mining firms. You can find many large firms listed on the FTSE 100. Equally the Alternative Investment Market (AIM) can offer access to smaller, newer enterprises. Through investing in mining stocks, you’re directly linking your capital to the success of these companies, and the changing value and price of gold.

While heavily correlated, the performance of gold mining stocks will not perfectly match the price of gold. Unlike the resource itself, companies are subject to a number of external factors such as employees taking strike action, geo-political implications for the area, natural disasters, and business decisions.

Pros

  • You can pick and choose a range of stocks through a Stocks and Shares ISA, and cash out when you want.
Cons

  • Like any investment, mining stocks are not immune to risk.

2. Gold ETFs

ETFs are another option worth considering. ETFs give access to a whole load of assets, without having to put all of your money into one or two firms. If you need to brush up on ETFs, check out our guide.

Simply, ETFs allow investors to minimise risk, while taking advantage of the performance and general popularity of a particular sector – in this case gold.

There are loads of gold-based ETFs to select from, covering off a whole host of different companies within the industry. There are mining companies, exploration companies, as well as the actual asset itself. Gold ETFs are a pretty good choice for those who are new to investing, as well as those looking to secure their portfolio.

Pros

  • ETFs allow for instant diversification across the whole gold industry, at a low price.
Cons

  • By placing your money in an ETF, you are trusting your gold portfolio to a robo—adviser, and so you naturally relinquish some control over the split of assets.

3. Buy solid gold

For some people, part of the appeal of gold is being able to hold it. If you’re one of those people then good news, buying solid gold has never been easier. Traditionally, you can buy gold Bullion via the Royal Mint.

The Royal Mint is the government owned mint that produced the UK’s coins. Head to The Royal Mint site and you’ll be able to choose from a range of Gold Bars. From 1g up to 1kg, you can buy it online today.

Alternatively, there are plenty of UK based dealerships that will buy and sell gold for competitive prices.

Pros

  • You have a tangible asset which is yours to hold, store, or pass on to someone else.
Cons

  • You will need to factor in the cost of secure storage and insurance if you plan to build up a stockpile of gold. These costs will stack up over time, even if the value of your gold decreases.

Compare these providers for access to gold ETFs and more

Updated February 17th, 2020
Name Product Price per trade Frequent trader rate Platform fees
Degiro Share Dealing
£1.75 + 0.022% (max £5.00)
£1.75 + 0.022% (max £5.00)
Portfolio transfer fees (in & out)
Your capital is at risk.
IG Share Dealing Account
£8
From £5
£0 - £24/quarter
Your capital is at risk.
eToro Free Stocks
0% commission, no markup, no ticket fee, no management fee
N/A
Withdrawal fee & GDP to USD deposit conversion
Your capital is at risk.
Saxo Markets Share Dealing Account
£8
0.05% (min £5)
0.12% per year & transfer-out fee
Your capital is at risk.
Hargreaves Lansdown Fund & Share Account
£11.95
£5.95
Transfer out fee
Your capital is at risk.

Compare up to 4 providers

How much is gold worth now?

Why is gold a ‘safe haven’?

There are many reasons people view gold a safe haven for investors. For example:

  • Gold is a physical asset
  • It is not easily created or destroyed
  • It does not change (it is resistant to oxidation, gold looks the same hundreds of years from now)
  • Cultural and historical value – gold predates modern currency, and has always been seen as beautiful and special
  • This is partly why governments turn to gold in times of financial crisis, which in itself adds to gold’s stability

What is a safe haven?

A safe haven investment is typically stable in times of market volatility. A safe haven is also useful for investors looking to diversify their portfolio, decreasing exposure to riskier assets or investments.

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