How does one buy precious metals?

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Forums › Finance and wealth management › How does one buy precious metals?

duckDecoy

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#287177 11-Jun-2021 14:31

I am interested in knowing how you would invest in previous metals, lets say under 5k.

Is it best to buy into some sort of precious metal pie fund or similar, although that may have some fees. Or just buy the stuff yourself.

I'd like to know more about the DIY approach regardless. Where do you get it from, what forms does it take, etc. A quick google found some places where you can buy it but they seem to want to store it for you, and I am not sure about what is a reasonable cut they take for buying and selling it from/to them.

Anybody got some tips or useful info?

blackjack17

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#2725312 11-Jun-2021 15:01

Our next door neighbour had around $70,000 worth of gold stolen.

Immigrants that didn't "trust" banks.

I wouldn't keep an valuable metals at home (not that I would buy any)

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wellygary

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#2725314 11-Jun-2021 15:09

Why are you buying it??

If you are speculating then buy ETFs or gold mining stocks,

If you are planning against the end of the world/NZ government becoming a banana republic and the NZ dollar being as valuable as toilet paper, then buy physical bullion, ( and then find somewhere to stash it)

HOWEVER, if the end of the world does not come and you subsequently want to sell you bullion I imagine there are al sorts of lovely AML hoops to jump through.... (the days of plonking down a gold bar and getting $XXXXX are probably long gone)

decibel

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#2725363 11-Jun-2021 15:12

blackjack17:

Our next door neighbour had around $70,000 worth of gold stolen.

Immigrants that didn't "trust" banks.

I wouldn't keep an valuable metals at home (not that I would buy any)

Your neighbour may have broken the primary rule here -

https://www.nzherald.co.nz/business/past-losses-tarnish-local-gold-bullion-trade/5NVU6PNC7LMGTACWBEV6FNLSK4/

"One of the primary rules of bullion is: Don't tell anyone you bought it. The other rule is: You can't get any more secure than holding it yourself. We've learnt from those sort of issues and we're trying to make sure that doesn't happen again."

However, letting people like Ray Smith look after it for you is equally foolish.

wellygary

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#2725365 11-Jun-2021 15:15

decibel:

However, letting people like Ray Smith look after it for you is equally foolish.

Wow, name from the 80s hey days when NZ was champagne and oysters.... then reality hit...

Beccara

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#2725366 11-Jun-2021 15:15

Plenty of shops selling coins and bars of various sizes that you walk out with. Typically the price should change daily and be a Spot + sub10% margin on top. Quality bullion from the Perth Mint is easier to buy and sell as it has a good rep locally

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#2725368 11-Jun-2021 15:16

I have recently been thinking about this too. Depending on the amount you wish to invest, I think the easiest and most practical way to do this is via Sharesies. This makes it incredibly simple and is practical for small or modest amounts.

If I was doing this, I’d go for an Exchange Traded Fund (ETF) like iShares Gold Trust or iShares MSCI Global Gold Miners ETF. iShares have been around for a long time and have a good reputation.

However bear in mind that these investments are denominated in USD, so you’re not just investing in a fund that tracks the price of gold (or, the case of the second one above, tracking an index of gold-mining companies’ share prices) - you’re also exposed to USD exchange risk. The USD value of your investment may go up if the price of gold increases - but your overall return can be enhanced or reduced depending on the USD/NZD exchange rate.

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Rikkitic

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#2725383 11-Jun-2021 15:45

New Zealand Gold Merchants ('gogold') is a reputable firm. There are others. I like the idea of bullion or other physical gold and so, apparently, do most people. Whether that is better or not is probably a matter of opinion.

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duckDecoy

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#2725392 11-Jun-2021 16:06

Thanks for the replies so far. Is all bullion created equal or are some seen as being better than others?

I get it if one is 99% and another is 99.999% then the later has more gold and probably is reflected in the price, but I wonder if some that I have seen that have "fancy" embossing etc have a higher price just for the looks rather than the gold.

duckDecoy

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#2725441 11-Jun-2021 16:16

duckDecoy:

Thanks for the replies so far. Is all bullion created equal or are some seen as being better than others?

I get it if one is 99% and another is 99.999% then the later has more gold and probably is reflected in the price, but I wonder if some that I have seen that have "fancy" embossing etc have a higher price just for the looks rather than the gold.

For example both the following are 99.99% gold, but the fancy embossed coin costs more:

Aus coin = $2,832.70

nz cast bar = $2,737.70

CYaBro

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#2726444 11-Jun-2021 16:57

I have a Krugerrand. 😂

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PolicyGuy

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#2727459 11-Jun-2021 17:55

CYaBro:

I have a Krugerrand. 😂

So that's a 1 oz coin
Today gold is about $NZ2,600/oz

How much premium over the gold price would a Kugerrand get?
And is that different to another 1 oz fine gold coin?

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mattwnz

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#2727461 11-Jun-2021 17:59

wellygary:

Why are you buying it??

If you are speculating then buy ETFs or gold mining stocks,

If you are planning against the end of the world/NZ government becoming a banana republic and the NZ dollar being as valuable as toilet paper, then buy physical bullion, ( and then find somewhere to stash it)

HOWEVER, if the end of the world does not come and you subsequently want to sell you bullion I imagine there are al sorts of lovely AML hoops to jump through.... (the days of plonking down a gold bar and getting $XXXXX are probably long gone)

I am guessing this is one reason people are buying houses, moving their cash savings from the bank, into assets. Happening all over the world pushing up prices even higher. A lot harder to steal a house.

decibel

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#2727473 11-Jun-2021 18:27

wellygary:

If you are planning against the end of the world/NZ government becoming a banana republic and the NZ dollar being as valuable as toilet paper, then buy physical bullion, ( and then find somewhere to stash it)

HOWEVER, if the end of the world does not come and you subsequently want to sell you bullion I imagine there are al sorts of lovely AML hoops to jump through.... (the days of plonking down a gold bar and getting $XXXXX are probably long gone)

Don't do what Alan Turing did at the start of WW2 - he and a mate buried some silver in a wood but at the end of the war, they couldn't find it again.