Author Topic: How to buy gold?  (Read 1231 times)

SimpleLifer

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How to buy gold?
« on: January 10, 2020, 12:00:45 PM »
I tried to answer this by reviewing old posts, but most of the threads I found were debates on the legitimacy of various ways to buy gold (ETF vs. bricks under the mattress, etc.)

If I want to implement Tyler's Golden Butterfly Portfolio, what asset represents gold in the GB portfolio? 

Is there ONE actual ticker symbol (GLD?)?...after reading through some of the debates, it sounds like there may be several, but at a minimum, I know I don't want to sleep on gold bricks under my mattress.

Tyler

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Re: How to buy gold?
« Reply #1 on: January 10, 2020, 12:26:30 PM »
The most popular ETF options are GLD, IAU, and SGOL. GLD is the largest, SGOL has the lowest expense ratio, and IAU is a good combination of both. Personally I use IAU.
« Last Edit: January 10, 2020, 12:32:42 PM by Tyler »

SimpleLifer

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Re: How to buy gold?
« Reply #2 on: January 10, 2020, 12:45:06 PM »
The most popular ETF options are GLD, IAU, and SGOL. GLD is the largest, SGOL has the lowest expense ratio, and IAU is a good combination of both. Personally I use IAU.

thank you, thank you, thank you!

MustacheAndaHalf

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Re: How to buy gold?
« Reply #3 on: January 11, 2020, 06:09:17 AM »
I don't own any of the 3, but want to add some perspective on the choices.

SGOL has the lowest expense ratio (0.17%, versus IAU at 0.25% and GLD at 0.40%), so you save money there.
SGOL is smaller, but still has $1.3 billion in assets.  According to etfdb, it had $1.1 billion of those assets 5 years ago.  So it's been around, and been stable.

ETFs with over a billion in assets are liquid: you can expect to buy and sell easily, and within a narrow range of prices.

Every so often I consider if I want to add a gold ETF to my portfolio, and in the past I've thought IAU is the best choice.  I guess I'm mostly posting since I'm surprised there was a better choice for years now: SGOL.  Still haven't bought, though, as the lack of "expected real return" bothers me (stocks grow and have dividends, bonds issue interest... gold just changes price).

flipboard

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Re: How to buy gold?
« Reply #4 on: January 12, 2020, 11:47:29 AM »
Every so often I consider if I want to add a gold ETF to my portfolio, and in the past I've thought IAU is the best choice.  I guess I'm mostly posting since I'm surprised there was a better choice for years now: SGOL.  Still haven't bought, though, as the lack of "expected real return" bothers me (stocks grow and have dividends, bonds issue interest... gold just changes price).
SGOL dropped its expense ratio last year, which is why it is now one of the best choices (whereas it probably wasn't when you last compared).

thunderball

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Re: How to buy gold?
« Reply #5 on: January 15, 2020, 05:26:18 PM »
I use CEF as it's backed by physical gold and silver.

https://www.sprott.com/media/1677/cef.pdf

celerystalks

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Re: How to buy gold?
« Reply #6 on: January 15, 2020, 06:38:37 PM »
I assume gold as an asset class in a theoretical portfolio tracks the historic spot price. Gold etfs have only been a thing since the early 2000s.

It is possible and relatively easy to buy gold and hold it directly. I get it on ebay. I signed up for ebaybucks, and regularly ebay will run ebaybucks promotions where you can get 8 or 10% instead of the normal 1%.  Also, I use a cash back credit card. Then I wait for sellers to have promotions, where certain coins will go on sale  for $xx over melt.  I think it is possible to get stuff for at or possibly just below spot this way.

 I think it is a good way to slowly build a position in gold be it 1% or 3% or 5% of one's portfolio over time.  I would not recommend buying a lot of gold all at once -- the price is volatile and there is a learning curve about the different coin or bar options available.


vand

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Re: How to buy gold?
« Reply #7 on: January 16, 2020, 04:25:02 AM »
One of the things about buying physical gold (and silver) often not mentioned when discussing its role in a portfolio is that a lot of the coins will gain collectability over the years and sell for good premiums on the secondary market.  Series such as the Queens Beast & Pandas have come to command a lot of premium value on top of any change in the price of the metal itself.

The catch is that it seems to be absolutely pot luck which coins will be sought after ones in the future.

When the (silver) Queens Beast coins were first released they commanded a huge premium, but then no one bought them so they got slashed down to miniscule premiums, so I bought lots of them simply based on the low premium. However then the series gained traction with collectors and the premium on the early QBs have basically doubled the value of the coin above the metal content. I expect that once the series is complete (in a years' time) a full set will sell for a very nice overall premium.

Mighty-Dollar

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Re: How to buy gold?
« Reply #8 on: January 18, 2020, 09:40:25 PM »
Don't put more than 3 - 5% in metals. Really that 3 - 5% should be in a natural resources ETF.

Stick with a gold ETF. Too risky and expensive to buy, transport and store physical gold. I recently unloaded the last of my physical gold. What a relief to not be burdened by it.

ice_beard

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Re: How to buy gold?
« Reply #9 on: January 20, 2020, 10:15:13 PM »
Go to Apmex and buy some gold.  They'll buy it back from you too when you are ready to sell it.

Take note that many states impose a sales tax on some if not all sales of precious metals.   These taxes can wipe out any "gains" you might have from any purchases you make. 
In California, if you buy over $1,500, the tax is waived. 
« Last Edit: January 20, 2020, 10:38:39 PM by ice_beard »