Buy gold futures Traders can strategically buy and sell futures contracts to benefit from the change in the price of gold. Buyers of futures contracts benefit when commodity prices rise. Futures sellers benefit when commodity prices fall. Contracts usually require a minimum purchase of 100 ounces of gold.
Investing in the shares of companies that extract, refine and trade gold is a much simpler proposition than buying physical gold. Since this means buying stocks from gold mining companies, you can invest using your brokerage account. Instead of investing in a mutual fund, you can also buy shares of gold mining companies (often referred to as gold stocks) directly. Investors can buy gold exchange-traded funds (ETFs) to avoid the uncertainty that comes with investing in a particular company.
An options contract, on the other hand, is an agreement that gives you the option to buy or sell a security if it reaches a certain price on or before a certain date. Minted coins usually range in size from a tenth of an ounce to an ounce to an ounce to adapt to the purchasing power of different investors. You can also choose to buy gold that you can use or that someone once used but that has been damaged in the form of gold jewelry. When buying gold jewelry, keep in mind that the price you pay will be linked to the craftsmanship of the piece and that the amount of gold it contains will be only a percentage (carats) of its total weight.
The easiest way to invest your money in gold is to buy and store gold bars, coins or jewelry. For people who are still going ahead with buying gold, buying gold in the form of tradable securities is a much easier and cheaper way to incorporate it into a portfolio. To buy stocks or gold funds, you'll need a brokerage account, which you can open with an online broker (here's a step-by-step guide to opening a brokerage account). That's one of the reasons why legendary investors, such as Warren Buffett, warn against investing in gold and instead advocate buying companies with cash flow.
Some retailers consider buying more than 100 gold bars (or 500 gold coins) a “wholesale purchase”, but this will largely depend on the seller. You can also buy smaller gold bars, ranging from half a gram to 100 grams, at specialized numismatic stores, pawn shops or some jewelry stores. Alternatives to investing in gold include buying shares in gold mining companies or gold exchange-traded funds (ETFs). If you don't want to have the trouble of having physical gold or dealing with the fast pace and margin requirements of the futures market, a good alternative is to buy an exchange-traded fund (ETF) that tracks the commodity.
To buy gold futures contracts, you need a brokerage account with a full-service broker that supports futures trading, such as Charles Shwab, E*Trade, or TD Ameritrade.