In the entire history of mankind, only one thing can be noted, the value of which has not fallen. Is this gold. Goods, people, entire states were exchanged for it. They killed and died for him. To this day, gold remains the most desired commodity and subject for investment. The reason for the demand for gold metal lies in its chemical properties, small amount, difficulty of extraction and many other factors.
Today, every major investor has a part of investments in gold in his portfolio. It can be the metal itself or its modifications: depersonalized accounts, coins, stock indices.
Over the past 15 years, the value of gold has increased by 400%. In terms of the annual rate, this is about 26% per annum. Growth does not indicate the stability of this investment. Over the years, the price has skyrocketed and collapsed. Gold is not suitable for short-term investments. This is a long-term investment with full protection against impairment.
Why is it worth investing in gold?
Historically, this asset has shown only positive dynamics, but only in the long term. There are several reasons to have a gold asset in your portfolio:
High liquidity. It is easy to buy and sell. Gold is always in demand at any time and in any country.
Gold is not tied to any country. This means that it does not depend on any state and will be equally in demand anywhere in the world.
Historical means for accumulation and savings. For many centuries, people have been saving gold, passing it from generation to generation.
Does not deteriorate and lose value. Gold can be stored for years and centuries. At the same time, it does not change shape, does not deteriorate, is not affected by the external environment, the effects of chemicals. Even gold that has lain in water does not decompose and does not lend itself to rust or corrosion.
Thus, for its properties, gold is so loved and appreciated all over the world. As far as possible, every investor should have it to save savings and earn money on them.
In recent years, the gold market has seen prices rise and fall. Now the situation is relatively stable and there are no major fluctuations. The fall in prices was due to the introduction of the D. Frank law, where it was forbidden for banks to trade in gold, and all transactions on the stock exchanges were declared illegal. After the largest gold fund of George Soros began to sell its shares, prices fell altogether.
Now a similar situation can be observed with the bitcoin cryptocurrency. His ban at the legislative level has seriously collapsed quotes. The price of gold depends on many factors and market behavior is difficult to predict. However, given its quantity in circulation, one thing is clear that the price will rise. If the state’s money can be printed, then gold is clearly not going to be added just like that. It remains only a matter of time.
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Options for investing in gold.
With the development of technology and opportunities, investing in gold has ceased to mean the purchase of only pure metal. New modifications have appeared that are in demand by investors and are popular. These include:
Purchase of pure metal.
Stock indices on the stock exchange.
Each option has its pros and cons, so it makes no sense to say that some are better and some are worse. Let’s consider each method.
Investment in metal.
Buying “live” metal bullion is a reliable way to invest. A standard ingot weighs about a kilogram. Before selling, it is weighed, a contract of sale, a certificate are drawn up. You can buy bullion in bank branches. Here you can find ingots of various shapes and weights. Having physical gold in hand, the investor is no longer dependent on the reliability of the bank, changes in laws, the market situation, etc.
As the experts say: “it is not so difficult to buy a bullion, but to ensure its safety.” Alternatively, the ingot can be placed in a personal home safe or rented a safe deposit box in a bank. Such storage is the sole responsibility of its owner. Even in a safe deposit box, the bank will not be responsible for its safety.
In addition to the problem of storage, there is also the problem of taxation. According to Russian legislation, VAT is included in the cost of the bar, which adds another 18% (now 20%) of its value on top of it. When selling an ingot back to the bank, VAT is no longer included in the price. If the price has remained stable during the period of ownership, then when selling, the buyer remains in the red. It is worth adding right there that even if the price rises, then a 13% tax will have to be paid on the profit. To earn something on bullion, you need to increase its value by 31% or more. In the long term (from 7-10 years), this is quite likely.
Thus, investing in bullion, although a reliable option, is costly and expensive. There are no ingots for a couple of grams, so you have to shell out a round sum to buy the desired ingot. After the purchase, you will have to rack your brains about storage and paying taxes. The liquidity of the bullion is low. It’s hard to sell it back quickly. Even if it was bought at a bank, upon return acceptance, the bank will carefully examine it for fakes, scratches, etc., underestimating its value.
Investments in coins.
If you want to have real gold, but there is no big money, then you can buy coins. This investment is similar to buying bullion. You will also have to think about its storage and subsequent sale. Prices for coins also do not grow rapidly, as well as for ingots. Such an investment can be classified as long-term.
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The value of a coin depends not only on the amount of gold in weight, but on minting, distribution, and the amount in circulation. Rare coins are in demand among numismatists who are willing to shell out good sums for its acquisition.
You can buy a coin at any branch of the bank. It’s harder to sell it back. If there is even microdamage, the bank may refuse to purchase, so the coins are stored in special capsules, albums, etc.
If investment coins are easier to sell, then it will be more difficult with collectible coins, although they are more expensive due to better minting and numismatic value. You need to look for your buyer, to whom it will be important not just as a purchase, but as a value.
A nice difference between a coin and an ingot is that you do not need to pay VAT. For several years, the value of coins can grow several times, which will bring income to its owner. Experts do not recommend investing in coins if there are no familiar professionals in the collecting segment.
Investment in OMS.
If there is no desire to have gold in physical form and there is also no big finance, then you can try investing in depersonalized metal accounts. When opening an account, the metal is purchased in any amount, even two grams. In fact, the owner of the compulsory medical insurance does not receive the metal in physical form, but has the right to demand the fulfillment of obligations by the bank to pay the cash equivalent of the metal available in the account. If the client has accumulated enough metal and wants to receive it in the form of an ingot, then he will have to pay VAT.
When investing in OMS, you do not need to take care of storing metal, and liquidity is high here: at any time, anonymized metal can be exchanged for money at the current rate. It is worth noting here that funds for compulsory medical insurance are not subject to insurance of deposits of individuals. How reliable the investment will be will depend on the bank, so you should opt for a reliable bank. Unlike coins and ingots, you can invest in CHI with even a couple of thousand rubles. On short periods, OMS is also not very interesting, because. will have to pay tax on the income received. When buying metal for a period of 3 years, the account holder is released from liability for paying tax.
You can open a CHI account at Sberbank, both at the office and in the online bank. When opening, an account agreement is formed, the amount of metal is purchased at the current rate. Further, the client himself decides when to sell and buy more metal.
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Investing in gold jewelry.
This is the most controversial way to invest. If in the case of coins and ingots they can only be hidden in a safe and wait for a price increase, then gold jewelry can be worn and aesthetically pleasing.
It is not entirely correct to use jewelry as an investment, since the income is most often negative. This is due to the fact that the price of the product includes the work of the master, the trade margin. For the manufacture of the product, not pure gold is used, but alloys, inserts, stones, etc. At the time of sale, it will be accepted as scrap for a price three times less than the current price at the outlet.
Considering that the price is constantly growing, the delivery of scrap can be profitable. So, in 2010, the price per gram of a gold product was about 1 thousand rubles, then in 2018 scrap is accepted at 1.4 thousand rubles. If calculated in annual percentages, then the yield was about 5% per year, which is not at all interesting for investing and earning.
When investing in gold jewelry, you can consider the artistic value. If this is an exclusive handmade product, then the product can be sold to a connoisseur of this kind of art. The question again is how to find it and how long it will be.
Exchange trading in gold.
Trading operations with gold can be carried out through a broker. With the help of stock mechanisms, you can earn not only on the growth of metal prices, but also on the fall. All operations are carried out at home via the Internet. To trade, you need to open an account with a broker, fund your account, choose the right time to invest, and follow the trend on the chart. On the trading page, you can make purchase and sale transactions.