3 Important Terms You Should Know Before You Start Investing In Gold
As the economy has stabilized in recent years, the opportunity for investing in gold has become more popular. If you are planning to protect yourself against financial difficulties in the future, gold is a good choice since its value is consistently recognized. Although its price can vary from one day to the next, gold is needed in the jewelry and industrial fields and therefore, it can be an ideal way to protect your interests. However, if you are interested in building your financial portfolio by investing in gold, there are three common terms that you will need to know.
#1-The Spot Price Of Gold
The spot price of gold, that is also known merely as "spot" refers to the cost of buying it today, usually in bullion bars, with immediate or almost immediate access to your purchase. That price is determined by the New York Commodities Exchange, which is also known as COMEX. Since Comex values change daily, it is not unusual for investors to buy or sell gold on a regular basis after referring to the current prices.
#2-Gold Eagles
Gold Eagles are a type of coin that have been minted by the US Mint since 1986. Gold Eagles come in four sizes: 1-oz, 1/2-oz, 1/4-oz, and 1/10-oz. It is important to note that there are minimum investments of any type of gold. The exception that that would be if you were buying from a private individual or you have made arrangements with the person selling the gold to make a smaller purchase. As a result, it is essential to know the current Comex price of gold and plan accordingly for your purchase.
#3-Gold Standard
Gold Standard refers to the ability to exchange paper money for gold and vice-versa. There are three different types of gold standard and it is your best interests to be familiar with each. Wikipedia mentions that gold specie standard is the current value of any gold coin currently circulating. Alternatively, it can also be of the same value as that gold coin, but is made of a less valuable metal.
The gold bullion standard includes gold coins that are not circulating at the time of its sale, but the appropriate authorities in that area are willing to buy it at a pre-determined price. Finally, the gold exchange standard does not pertain to circulating gold coins in any way. Instead, they can be used as a type of currency with other countries, based on an agreement that the federal government has with that country. The other country will need to use a gold specie or bullion and standard.
In conclusion, the decision to buy gold is a viable and popular investment option. If you are planning to supplement your investment portfolio with gold, it is crucial to have an understanding of the above three common terms that pertain to this field.