The world of buying gold isn't always easy to decipher, especially if you're new to the endeavor. Learn what seasoned gold buyers are keeping top of mind in 2016 and what they may be doing to help plan for and maintain their portfolios.
#1 Research, seek referrals & maintain privacy
The best gold buyers do their homework. Know specifically which gold coins you want to buy and who has the best prices. Know how much you're willing to spend, and how much you're not willing to spend. Your research will help you be able to determine whether a price is fair. With gold trading scams on the rise, it could be wisest to stick to companies that have been in business for a notable period of time, for at least five years. U.S. Money Reserve, for instance, has been in business for 15 years.
#2 Watch where the big players are putting their hard earned money
During the first quarter, the legendary George Soros, aka the “man who broke the Bank of England,” purchased $264 million worth of shares of Barrick Gold (ABX) (the world's largest gold miner) and acquired 1.1 million options to buy the popular SPDR Gold ETF (GLD), reports CNN Money. Others soon followed suit. May 6th filings revealed that Jana Partners, led by Barry Rosenstein, bought 50,000 shares worth about $5.9 million; CI Investments, a Toronto-based financial corporation, nearly quadrupled its stake in the ETF, cites Fortune.
Why are the big players buying gold? No one can say for sure. CNN Money reporter Matt Egan postulates that Soros, in particular, could be betting on a decline in the U.S stock market. Or, he could be trying to hedge his overall portfolio. Regardless of his reasons for jumping back into the gold market, Soros must he doing something right. He's recognized as the 27th richest person in world, the world's richest hedge-fund manager, and has a net worth estimated at $23 billion. According to Raul Moreno of iBillionaire, an app that tracks portfolios of influential financial players, “Soros has made money in markets going up or down, so people definitely trust what he's saying.” Stay in-the-know via traditional media outlets, on U.S. Money Reserve's blog, or via iBillionaire.
#3 Know that the price of gold has increased and decreased in the past
…and it's likely to continue to do so in 2016. Experienced professionals, like Philip Diehl, know that while gold prices fluctuate, there are really only a few forces at play: the value of the dollar, interest rates, economic and political events, central banks, ETFs, and gold mine production.
What's more, pricing for precious metal numismatic products (e.g., platinum, 24K gold, 22K gold) varies by the average cost of the underlying metal. The United States Mint, for instance, consults an internal pricing range table the week prior to sale in order to determine a product's price.
As Diehl notes in a recent guest blog about the price of gold, “Prices are likely to remain volatile…as the dollar rises and falls, political and economic crises ebb and flow, and traders use ETFs to speculate on short-term price movements. For those of us who buy and hold for the long term, it’s best to put our gold in a safe place and ignore the volatility.” So if you're considering buying gold for the first time in 2016, reevaluate your expectations and don't feel alarmed; the price of gold could go up, or down, and this is not atypical.
#4 Don't fret over the daily news, but do follow it
Staying informed and aware will not only help you keep track of where the industry's big players are putting their money, it will also help you better maintain your financial portfolio and cue you into any economic changes that could be a reason to purchase more gold.
For instance, if you were following the news recently, you may know that there are a handful of key national and international events that could impact your gold buying plans. According to Kitco News, gold and precious metals markets could respond to the U.S. dollar statements that emerge from the G-7 Meeting; renewed CPI inflation worries might provide more support for gold; and Fed Chair Janet Yellen may reveal some market moving headlines in her speech on May 27 as she accepts the Radcliffe Medal.
#5 Focus on the big picture
Volatility and change can worry some potential gold buyers. In the long run, though, ownership of precious metals has a long recorded history of safeguarding wealth during periods of economic downturn. Many gold buyers choose to look at their purchase like they do their home insurance policy.
According to Sol Pahla, Senior Financial Analyst at TacticalInvestor.com, “Prudence dictates that one should have a core position in precious metals. You don’t purchase insurance on your home because you know your home is going to burn down. You purchase it because in the event it does burn down, you are protected. Gold bullion should be viewed along the same lines.” As one of the oldest financial assets that exists, gold has proven to be able to weather most any economic crisis.
With these five secrets in hand, you could be ready to make your first gold purchase. It's time to put your knowledge and research into action. Call 1-844-307-1589 to learn more from a knowledgeable Account Executive and buy gold from U.S Money Reserve.