Watch the Gold Price

Posted on by Lee

Watch the gold price

Picking the right time to buy gold is a matter of keeping a close eye on the price and picking the opportune moment.

Gold prices change every two minutes, and it is very easy these days to keep track of it on your PC, phone, or tablet.   You have never had more information at your fingertips in order to choose the best moment for you to invest.

While the market feels like it is constantly moving up, it’s not uncommon for the price to drop by 3-5% in one morning.  For many investors, this would pose an opportunity to invest, and for new investors, it might be a great moment to take your first plunge.

Finding the right time to invest is down to the individual investor and the market state that they are most comfortable with.  Some prefer to invest when the market dips, others prefer to invest when during more stable periods, or even in the middle of very strong periods.

Whatever your preference, you should only buy gold when you feel comfortable with the price.

Disclaimer: This is not financial advice.

The Security Blanket of Gold

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The security blanket of gold

Investing in gold bullion should be considered a long-term investment and is about owning a safe and secure asset.  It’s not about making quick profits by buying and selling in the short term.

Of course, if you do buy at the right time and you catch a big move up making some great profits then by all means take that profit out.  Plenty of people have and will continue to make large gains from gold.

Investing in gold, however, is ultimately about safeguarding your wealth and protecting yourself in the event of a financial crisis by having at least a portion of it in a safe asset that you physically hold, rather than leaving it in banks or ETFs.

We live by the saying “if you don’t hold it, you don’t own it”.  We understand this can’t apply to all your assets, and in this day and age it wouldn’t make sense to, but, holding a good portion of your wealth in gold DOES make a lot of sense.

And as for profits?  Historical data shows that gold is more likely to make you a better return on investment than any other asset or commodity over the last decade.

Disclaimer: This is not financial advice.

Why buy Royal Mint Bullion Coins?

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Why buy Royal Mint bullion coins?

Royal mint bullion coins make the ideal investment for a wealthy British investor intending to spend more than £50,000 or more.  Why?

Royal mint bullion coins are British legal tender and because of this are capital gains tax-free.  This means they offer opportunities for high-wealth investors to save on their CTG and maximise profits.

This capital gains exemption applies to Britannias and Sovereign coins as well as special series coins like the Queen’s Beast and Lunar collections.

Add to this the fact that gold is also VAT exempt then making Royal Mint bullion coins one of your primary gold purchases can be a very cost-effective investment.

Disclaimer: This is not financial advice.

Gold:

Posted on by Lee

Gold:

Gold bullion is considered old-fashioned when compared with bitcoin or other cryptocurrencies, but it is still the ideal investment to store and protect your wealth.

Yes, gold bars aren’t easy to carry around with you, and you can’t walk into a shop and buy your groceries with some gold.  But it is an investment resource and a bit of a collectible, and when it comes to your money, old-fashioned is no bad thing.

Gold is seen as a safe haven for your wealth, and rightly so.  Gold is a physical asset that you can hold and access that has a true value.  The value of gold also tends to increase in line with inflation, which is currently between 2.5% and 3%.

At the moment, with the Bank of England’s interest rates and the US Federal Reserve both being limited, we currently have a negative real interest rate.

What does this mean?  It means that inflation rates are growing faster than interest rates and so our fiat currency, whether pound, euro, or dollar is devaluing as the cost of living is increasing.

So leaving your money in the bank is actually costing you money.

Buying gold bullion is the ideal solution to this.  As we’ve said, it matches inflation, is a trusted commodity, it retains its value, and there will always be buyers.

Gold is unarguably less exciting than stocks or cryptocurrencies, and far less headline-grabbing.   And when those markets push higher and higher they can generate fortunes for the savvy investors (or the lucky amateur).  But, when the market comes crashing back down again, as it always does, it’s silver and gold that investors turn back to.

 

Disclaimer: This is not financial advice.

Bitcoin vs Gold

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Bitcoin vs Gold
Cryptocurrencies are all the rage at the moment.  But it can be hard for an investor to get their head around them.  As a new technology it is unregulated but still has an impact on finance.  Its effects on the stock market and fiat currency are beginning to be seen.  But will it also affect gold?

Bitcoin:

Digital currencies seemed like an inevitability, but their growth over the last couple of years has been so astronomical it has taken the world by surprise.

The improvements to online security and the ease of online payments via Near Field Technology means that the lack of physical currency is actually a benefit to people and reduces risk.

Technologies that were nothing more than ideas ten years ago, like contactless payments from your phone, are now a reality.  In a constantly evolving technical world, banking and finance were always going to be an area of opportunity for new tech.

So what is Bitcoin?

Bitcoin is an ever-growing ledger of public transactional data that is anonymous.

While traditional banking methods of moving funds require your bank to verify your funds, hold your funds and remove funds from your balance to pay others, all of this is done on the basis that you trust the bank fully.

Bitcoin replaces the need for your bank to do all of that and operates without interference.  Bitcoin ‘miners’ take the transactional data and authorise the payment.  These miners then bundle them up with other transactions to ensure the data is safe and encrypted (basically hiding the data with a lot of other data) and in return, these miners are paid in Bitcoin.

As a safeguard, other miners then take this data to verify the transaction isn’t a duplicate and that the person spending Bitcoin isn’t spending the same one twice.

Simply put, cryptocurrencies, like Bitcoin, use a decentralised technology (blockchain) to let people make payments and store money securely and anonymously.

This whole process takes an incredible amount of processing power and electrical energy to do.

There are many who question why this was needed at all, and what is really so wrong with the banking system?

The simple answer is, data protection has become such an important issue to everyday consumers, and rightly so.  With the recent revelations such as the Facebook and Cambridge Analytica data breaches, people want to know that their personal data is safe, particularly when it comes to their finances.

Cryptocurrencies like Bitcoin help bring that security to people’s financial data.

Bitcoin and cryptocurrencies, in general, have a bit issue with price instability at the moment, however.  In the last two years alone bitcoin has seen highs of 74,000 and lows of 3,925 which is an incredibly big swing.

This volatility is caused by a lack of regulation and the popular culture influence of FOMO (fear of missing out), as well as government interference and the continued fear of hackers and theft.

National governments have begun getting involved, banning the initial coin offerings in some countries and banning the trading of cryptocurrency in others.

Cybercrime is another problem for cryptocurrencies, and millions of dollars worth of crypto have been lost since 2010.  The primary fear is that if a company holding cryptocurrency is breached will companies be able to repay the losses to investors?

The final risk is cryptocurrency’s prevalent use on the black market for all sorts of illicit and illegal dealings.  Anonymity in transactions is ideal for them, and governments are working hard on cracking down on this.

News of this sort of activity reaches consumer’s ears, however, and damages the reputation of cryptocurrencies.

There is no doubt that Bitcoin and other cryptocurrencies will continue to grow in popularity, and the blockchain technology it is built on is here to stay and will be an essential part of the future of data management.

For the moment, however, there is an awful lot of risk associated with investing in Bitcoin, and for the savvy investor looking for more security, our old familiar gold is still the way to go.

Disclaimer: This is not financial advice.

Portfolio Diversification

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Portfolio diversification

Investing in and owning physical silver bars and coins is a great way of diversifying an investor’s portfolio.  It helps spread the risk within the portfolio and gives an extra layer of protection against other investments.

It is widely agreed that silver is likely to strengthen over time, and while the price is currently low compared to the highs of 2011, it is a very solid investment.

In particular, silver is very widely used in industry as it is an incredible electrical conductor.  So, despite it being a precious metal, silver is being used extensively in electric cars, solar panels, and computers.

Easy to exchange

Many individuals and investors are turning to silver as an alternative form of currency too as a protection against the possibility that money will lose much of its value.  This is only growing more prevalent in the current uncertain world economic climate.

That’s not to say that fiat currency (your pound coins and notes) are likely to be scrapped and the economy collapses entirely, but British bullion coins are legal tender with a face value, and as an investment against any eventuality it makes a lot of sense.

In the event of complete economic collapse silver offers the ideal currency for small everyday items rather than gold, which is worth about 80 times more than silver, which would be more suited to larger purchases.

Disclaimer: This is not financial advice.

A Long-Term Investment

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A long-term investment

Investors are often turning away from silver because all silver bars and coins are taxed at a rate of 20%.  The paying of VAT (or value added tax) on silver usually leads investors to conclude gold is a better investment.

Silver is still a very good option, however.

Silver should be considered a long terms investment and our advice is to hold it for at least twelve months if not for a good few years.  Twelve months is usually considered to be enough time to compensate for the 20% vat cost and return a profit.

As an example, an investor that invested £5000 (£6000 with VAT) in silver in 2008 and held it for three years would have had the value of their investment rise to over £16,000.

As a bonus tip, second-hand silver doesn’t have VAT charged on it, so it’s always worth asking your dealer if they have any second-hand coins or bars.

 

Disclaimer: This is not financial advice.

Should I buy Silver as Well as Gold Bullion?

Posted on by Lee

Should I buy silver as well as gold bullion?

 

It’s not uncommon for investors to put in a lot of time researching whether they should invest in gold or invest in silver.  For the savvy investor, the answer is both!

Gold is a great investment and can act as an insurance policy against uncertain times, while silver is more of a speculative investment.

Both are popular and common investment assets, but silver offers a very different challenge to gold.  A challenge that can generate substantial profits despite the VAT costs.  These differences are why an investor should consider owning both as a part of their portfolio.

Silver is a speculative investment

The price of silver is far more volatile than gold, which is why it doesn’t have the same level of security.  Silver is, however, also a physical asset which means, like gold, it will always have an intrinsic value and can not be simply devalued by inflation.

The volatility in the price actually presents an opportunity for investors to buy and sell over shorter timelines in order to make a profit.  Hence it is more of a speculative investment.

The price can move quickly, and significantly, so applying caution and paying close attention to the financial sector will be key to taking advantage of the opportunities that present.

Historically, silver has proved to be a very good investment.  In the three years between 2008 and 2011, for example, the price of silver rose by 233%.  That is dramatically more than stocks and property, and more than gold too.

More recently, in 2019, silver saw a gain of 28.9%, again outperforming gold in dollars.  The opportunities are there to be taken advantage of.

The price of silver is currently low compared with the highs of 2011.  All markets tend to fluctuate from a bearish market (prices moving down) to a bullish market (prices moving up) and commodities like silver are no different.

Usually, it is only a matter of time before the market decides the price is too high and stops buying, or too low and starts buying.

Disclaimer: This is not financial advice.

Small Investors and First-Time Investors

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Small investors and first-time investors

Smaller and first-time investors wanting to buy gold bullion should consider both bars and coins.

100g gold bars and 1-ounce gold bars are a very popular starting point for new investors, with a price tag of around £2,500 and £750 respectively.

Gold coins seem like the obvious choice when it comes to lower value investment, though depending on how much you want to invest, you may want to consider the lower premiums on bars.

That being said, the South African Krugerrand coins tend to attract a lower premium than other coins and are a very popular choice for new investors at a cost of around £800.

Gold British coins are also a great way to start investing in gold bullion and offer a much cheaper barrier for entry at £200 for a gold sovereign and £100 for a half-sovereign.

Investing in silver is also an excellent start for smaller and newer investors looking to get into commodities, and there are a whole host of 1-ounce silver coins to choose from.

We recommend buying the lower unit cost coins like the silver Maples and the Philharmonic coins as when you come to sell them you only get the intrinsic value of the metal.  So, the cheaper you bought them the better return you’ll make.

Disclaimer: This is not financial advice.

Should I buy Silver as Well as Gold Bullion?

Posted on by Lee

It’s not uncommon for investors to put in a lot of time researching whether they should invest in gold or invest in silver.  For the savvy investor, the answer is both!

Gold is a great investment and can act as an insurance policy against uncertain times, while silver is more of a speculative investment.

Both are popular and common investment assets, but silver offers a very different challenge to gold.  A challenge that can generate substantial profits despite the VAT costs.  These differences are why an investor should consider owning both as a part of their portfolio.

Silver is a speculative investment

The price of silver is far more volatile than gold, which is why it doesn’t have the same level of security.  Silver is, however, also a physical asset which means, like gold, it will always have an intrinsic value and can not be simply devalued by inflation.

The volatility in the price actually presents an opportunity for investors to buy and sell over shorter timelines in order to make a profit.  Hence it is more of a speculative investment.

The price can move quickly, and significantly, so applying caution and paying close attention to the financial sector will be key to taking advantage of the opportunities that present.

Historically, silver has proved to be a very good investment.  In the three years between 2008 and 2011, for example, the price of silver rose by 233%.  That is dramatically more than stocks and property, and more than gold too.

More recently, in 2019, silver saw a gain of 28.9%, again outperforming gold in dollars.  The opportunities are there to be taken advantage of.

The price of silver is currently low compared with the highs of 2011.  All markets tend to fluctuate from a bearish market (prices moving down) to a bullish market (prices moving up) and commodities like silver are no different.

Usually, it is only a matter of time before the market decides the price is too high and stops buying, or too low and starts buying.

Disclaimer: This is not financial advice.