How to Make Money in Gold Investments

HOW TO MAKE MONEY IN GOLD
INVESTMENTS
By www.ProfitableInvestingTips.com

http://profitableinvestingtips.com/profitable-investing-tips/how-to-make-money-in-gold-investments
It is possible to make a lot of money
investing in gold and it is possible to
lose your shirt in the gold market.

In times of social and economic
uncertainty gold is an attractive
alternative to stocks or holding cash.

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But when the stock market is hot,
gold is usually a losing proposition.

How to make money in gold
investments has to do with timing,
your investment time horizon and the
vehicle you use to invest.

In August of 1999 an ounce of gold
was worth $256.

At the end of July in 2016 an ounce
of gold sells for $1,314.

investment might have been to buy
in 1999 and sell today but there is
more to the story.

Gold versus Stocks

Reuters reports that gold slips as
stocks rise.

This is earnings week for the stock
market and both the Federal
Reserve and Bank of Japan are
meeting.

Gold fell on Monday as the dollar
firmed and a recovery in risk appetite
supported world stock markets near
nine-month highs ahead of central
bank meetings in the United States
and Japan.

The world’s major economies
pledged at a G20 meeting this
weekend, dominated by Britain’s
vote last month to leave the
European Union, to use all policy
tools available to boost growth.

That lifted both shares and the
dollar.

Spot gold was down 0.7 percent at
$1,313.96 an ounce at 1400 GMT,
while U.S. gold futures for August
delivery were down $9.90 an ounce
at $1,313.50.

When stocks are hot gold tends to
fall.

investments is obviously to invest
when gold is weak and sell when it is
high.

But are there other options aside
from buying and selling gold bullion?

Gold ETFs

Gold ETFs are a reasonable way to
buy and sell gold.

Investopedia looks at
the relationship between gold and
gold ETFs.

Exchange Traded Funds (ETFs) give
traders access to the percentage
price movements of physical gold,
without having to buy physical gold
or futures contracts.

Instead, the ETF does this for the
investor.

Gold ETFs are typically structured as
a trust.

Under this structure, the ETF holds a
certain amount of gold for each
share of the ETF that is issued.

Buying a share means owning a
portion of the gold held by the trust.

The advantage of buying shares in a
gold ETF is that you do need to pay
for storing your gold bars or endure
a wait while you buy or sell and take
or give up possession.

To a degree holding gold bullion is a
doomsday investment while ETFs
are how to make money in gold
investments without the overhead of
holding gold bullion.

You simply buy and sell shares of
the ETF as you would common
stocks.

Gold Miners

A common rap against holding gold
is that it produces no income while
you wait.

With this thought in mind an
alternative to buying gold or shares
in an ETF is to buy shares in a gold
mining company.

Gold mining stocks rise and fall with
the price of gold.

In fact gold mining stocks typically
rise faster than gold itself in a bull
market but they also fall faster in a
bear market.

US News wrote about gold
miners at the start of this year as
gold started to rise.

An interesting aspect of gold mining
is that much of it occurs outside of
the USA and the costs of operation
are in local, and weaker, currencies.

Day cautions would-be investors to
look at corporate balance sheets of
gold miners if metal prices rise.

A strong move up in gold can cause
the miners with the most debt and
highest cost of production to see
their stock values rally the most.

“A small move in the price [of gold]
makes a big difference if your cost of
production is marginal,” he says.

“If you produce gold at $600, your
profit doesn’t go up much if gold
moves from $1,100 to $1,200.

But it makes a huge difference if
your cost of production is $1,150.”

investments includes careful analysis
of gold mining operations and
selective investments.

How to Make Money in Gold Investments

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