There are many forms of gold available to the consumer/investor. Gold is present in jewelry, coins, bullion, with very small quantities found in industry, electronics,medicine, and some food and drink. So what form is the best gold investment?
Let’s explore the three main forms of gold.
The purest form of gold jewelry comes in the 24K form. Because gold is a soft metal and can be easily bent or damaged, many pieces of gold jewelry that are purchased by consumers come in different carat weights. These different carat weights contain other metals such as copper, silver, palladium or other metals to increase the strength of the gold piece.
For example: Gold jewelry with an 18K weight contains only 75% gold. Gold jewelry with a 14K weight contains 58.4% gold. Because most jewelry is not in pure form, it is typically not the form of gold that would make it the best gold investment.
Historically, gold coins were pieces of gold that were typically stamped with a face value and used as money. After the 1930s, when the gold standard was abandoned, these coins became more of a collector’s item. This means that a good amount of the genuine gold coins circulating are over 70 years old. These older coins can have a high value because of the rarity and age of the coins.
More recently though, gold coins such as the Krugerrand, Chinese Panda, and the American Gold Eagle have become widely sought after. They typically contain 31.15 grams (or one troy ounce) of pure gold. One of the main reasons for the popularity of the gold coin in recent times is that because of their smaller size, individuals are able to buy and sell in smaller amounts more easily.
Gold Bullion (Gold Bars)
Gold bars are typically made from molten gold that has been assayed and refined. It is then either poured into a mold and formed or stamped out of a sheet of gold. Regardless of how it is formed, each is stamped with its weight and purity. Gold bars or bullion also come in a variety of sizes.
Gold bars or bullion are typically the most cost effective way to store gold, but must be purchased and kept in a registered professional gold storage facility to remain cost effective. If the gold were purchased and delivered to the purchaser, the gold bars lose their integrity and must be re-assayed and refined before being able to sell again. This in turn adds to the cost of investing using gold bullion.
So, as far as the best gold investment goes, you need to make that decision based on your situation.
If you are an individual who would prefer to physically obtain gold and purchase in small quantities, your best gold investment would be in the coin form. If you are interested in an investment in pure gold and not needing to handle the gold, then the best gold investment and most cost-effective form would be in the gold bullion.