More and more individuals looking for a financial investment are turning to physical gold purchases. But how to buy physical gold online and in what form is it best to buy it? This is what we propose to discover here with all our explanations on the purchase of gold bars and gold coins online, the different methods at your disposal and their advantages and constraints as well as more general information on the taxation of this investment.
Let's first look at why more and more investors are turning to physical gold as an investment asset.
First of all, it should be noted that although the general economic environment has changed a lot in the last few years, some elements remain the same and are still favourable to gold investment. At first glance, the rise in interest rates in the United States and the tightening of monetary policy in this economic zone due to a better economic situation could indeed push investors to abandon gold for other types of securities. But before making such a decision, it is of course essential to also take inflation into account. Indeed, the price indices are currently tending to rise in both the United States and Europe, which is a sign of a significant and lasting rise in inflation in these two major economic zones. Also, because of this inflation, interest rates are adjusted to give real rates. However, these real rates remain relatively low, which could therefore benefit gold.
Indeed, the gold bullion although sometimes presenting a return almost zero remains at least as interesting as other types of investments whose rates of return are particularly low for the moment.
To know if it is interesting to buy physical gold online and to invest in the precious yellow metal, it is enough to follow the comments of the analysts specialized in this sector. These analysts give a rather positive opinion about the future of the gold price in the medium or long term, even if these recommendations should not be taken at face value. To justify their theory, these analysts rely on the evolution of real interest rates of course but also on other important factors such as certain worries and uncertainties of the markets in the context for example of the presidency of Donald Trump in the United States, other important elections or even the Brexit. Analysts also fear a sharp depreciation of the euro as a currency in the foreign exchange market. Yet, all these factors could turn out to be beneficial to gold. Recall that gold has historically played a role as a primary global currency and safe haven given that it is not exposed to counterparty risks and this is what makes the markets so keen on it.
Of course, it is not only the purely speculative factors in the gold price that need to be taken into account in this most likely price analysis for the coming years. There is also an increase in demand for gold around the world and in the markets. Indeed, because of the various economic and political tensions that we know for some time, savers or ETFs tend to increase the size of their positions on the precious yellow metal which will of course have the effect of boosting prices once again. Demand is also accelerating from some countries that are well known to gold traders. This is particularly the case for India, for which a strong demand is expected for the creation of jewellery against the background of significant economic growth. It should be noted here that India is currently the world's second largest importer of gold after China. This increase in Indian demand will also be the result of several impacting factors such as the end of the crisis caused by the withdrawal of 500 and 1,000 rupee notes from circulation in 2016, which had caused gold purchases to fall by more than 20%, or the particularly good harvests of this country in recent years with greater profitability of companies, an increase in salaries, particularly for government employees and therefore an overall increase in purchasing power. But here again, these data change over time and certain factors can quickly reverse the trend.
In conclusion and even if some people continue to believe that the best time to invest in gold is over, others continue to believe and buy gold coins and gold bars online. As we have seen, gold is indeed currently experiencing a growing interest from individual investors. However, an increase in real interest rates would result in an equivalent loss of GDP for these countries in order to pay the interest on the debt incurred. Also, in the current economic situation, such a repayment seems difficult to bear, especially because of weak growth.
Of course, we are talking about a long-term trend in the price of gold, since in the shorter term, it could still record more volatile upward or downward trends following the Fed's decisions to raise or lower rates. It is therefore preferable to concentrate on a quality analysis and in particular on a meticulous study of the charts.
If you wish to invest on the gold price by physically buying coins or ingots, there are various solutions which we propose to you to discover here in details. Indeed, in front of the growing interest of the private savers for the invaluable yellow metal, the banks are not any more the only ones to give you the opportunity to buy gold and you have from now on other possibilities to do it.
First of all, you can use order placement to invest in gold. This type of investment is of course done through a bank and its network that offers buying and selling of gold. However, this type of transaction requires a certain knowledge of the orders on gold since few advisers will be able to guide you in this investment. The orders on gold in bank are indeed very rare and the professionals of the banking environment are thus not necessarily the most seasoned in this type of exercise. You will therefore have to contact your advisor knowing as precisely as possible what you are looking for and the products you wish to invest in. Of course, not all banks are the same when it comes to investing in gold and some are more appropriate than others because they provide their investor clients with tools that allow them to place orders directly online or to be informed of the availability of products and their prices. This method of investing in gold also has other shortcomings such as the impossibility of processing orders live and in real time. In the best case, the order is placed during the day and most often the next day. This time difference can therefore have a negative influence on the profitability of the investment. In addition, the commissions charged for each transaction can be relatively high and thus represent an additional cost for the investor. However, you should know that banks also allow you to hold physical gold. To do this, you must request delivery in a branch, which can take several days depending on your region, and keep your physical gold in a safe deposit box rented from the bank or even directly at home. But be careful! Storing your gold yourself at home is not without risk and some insurance companies may require you to have a secure safe and an alarm system. All this represents an additional cost to be taken into account.
Of course, in addition to the banking solution to buy physical gold, you can use other methods that allow you to invest in the price of gold without having to physically hold it. Indeed, if you do not wish to keep gold bars or coins, there are solutions that allow you to expose your portfolio to the variations of the gold price with products that offer greater liquidity. This is the case with ETFs, which meet this need perfectly. These are funds that are backed by the price of physical gold and have been extremely successful in recent years. Indeed, these ETFs have seen a sharp rise in demand since 2009, which has compensated for the fall in demand in other areas such as jewellery, central banks and technology.
Another way to invest in gold without having to physically hold it is to use gold certificates. To do this, you must of course have a trading account through your bank. These certificates work by simply replicating the performance of an ounce of gold, both up and down, and can be used with a hedge against the EUR/USD exchange rate without being backed by physical gold.
Finally, you can also find online solutions that allow you to speculate on the price of gold without actually buying it, such as CFDs or Turbos without an expiry date. But be careful! These products allow the use of leverage and are therefore riskier than the other solutions we have just mentioned. Therefore, this type of investment is reserved for the most seasoned investors and should be used with the utmost caution, preferably with a very short-term strategy.
Generally speaking, if you are considering investing in gold through these dematerialized solutions, it is strongly advised to place orders preferably with a limit price and to close your positions as soon as you reach the target you have set yourself. You can also use stop loss orders which allow you to avoid following the market live but will cut your losses when the scenario is unfavourable to you and at the price level you have determined in advance. Thus, these products require real management on the part of the investor and a lot of time and knowledge beforehand. They are therefore absolutely not suitable for beginners. Indeed, given the high volatility of the price of gold on the stock market, the variations multiplied by a leverage effect, upwards as well as downwards, can lead to a total loss of your capital, which is in no way protected. As you will have understood, if you are looking above all for the security provided by the purchase of physical gold bars or coins, these solutions should be avoided.
In view of the different solutions that we have just mentioned together, it may seem complicated for the saver to make a concrete choice as to the best way to profit from the variations in the price of gold. Bank investment solutions being unprofitable, expensive and unattractive and dematerialized trading solutions being more risky for your capital. Fortunately, with time, other solutions have emerged and now allow you to buy physical gold to take advantage of these variations without even having to leave home and directly online. These are the online gold brokers that aim to simplify the purchase of gold coins and gold bars for individuals and integrate a solution of holding and storage in their own name.
With these solutions, you buy your physical gold directly online and no longer have to worry about counterparty risks, the risk of temporary or permanent bank failures or even government confiscation of the gold. The online buyer is protected and remains the sole owner of the coins and bars he has acquired.
Of course, you should choose carefully the broker through which you will make your physical gold purchases. GoldBroker, for example, is a very serious broker that offers gold coins and bars from refiners certified by the London Bullion Market Association or LBMA. The ingots that you can buy through this intermediary are all certified containing a fineness at least equal to 995 or 99.5% of gold. These bars are of course also traceable as soon as they leave the production line and remain in the professional circuit permanently. Thus, your gold guarantees you a maximum resale value.
Another advantage of using an online gold buying and selling site is of course the advice you can get in the context of these investments. Indeed, experts in investment on precious metals are at your disposal to guide you throughout your purchase procedure and to provide answers to all the questions you have in this regard.
As we have seen above, buying gold is a very popular way of investing for savers and investors. But what are the real advantages of owning gold rather than other stock market assets? In reality, there is no safer asset than another but gold is often considered a little safer than some more volatile stocks.
Firstly, compared to traditional savings products, gold can offer an interesting return in the event of an upward trend. The savings books offered by the banks have particularly low interest rates and are therefore not very attractive for individuals. This also applies to the maximum amounts that limit this type of investment. Investing in gold, on the other hand, can be much more profitable given the volatility of these prices.
The financial investment products of banks may sometimes seem more attractive but they are not immune to a collapse of the system as we have experienced with some countries recently and therefore a bankruptcy of the banks concerned. Buying gold without going through a bank therefore guarantees that you will not lose your gold bars and coins.
Compared to other stock market assets, gold also has the advantage of being more or less protected against the risks of a vertiginous fall that can be observed in certain situations. Indeed, gold does not suffer the same negative effects as these stock market assets in times of economic crisis and can, on the contrary, be an alternative as a safe haven or hedge investment for investors who wish to protect themselves from the collapse of the markets.
One can also appreciate the variety of solutions that are available to gold investors and that we have just presented to you above. Thanks to these different methods, each investor is able to find the solution that best suits his needs according to his level of knowledge and experience, the amount of his capital and his personal investment horizon while controlling the level of risk he is willing to take.
Finally, it is also possible to analyse the price of gold according to different elements such as the interest rates set by the major central banks, including the Fed, the level of growth of the world economy or the evolution of demand from the countries that import the precious metal. The analysis of the best entry and exit points of the market and therefore the best moments to buy and resell your gold is thus possible and allows the implementation of more precise strategies.