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Anonymous

20 Apr 2020

General Investing

Should I invest in gold or gold ETFs?

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Discussion (2)

Hello!

personally, I would invest in gold etfs due to convenience as compared to physical gold. By investing in gold etfs, the accumulation of gold in the long term would be easier since there is no need to worry about theft ot purity or where to store it. However, as mentioned by Sandra, buying gold etfs does not mean you own the gold. So if you are someone who prefers to own the physical property, gold etfs would be a better choice. Hope this helps !

This would depend on your risk temperament and portfolio needs. Advantages of Gold ETFs is its liquidity, transparency and low management fees. However, gold ETFs comes with a lot of counterparty risk, where the fund could possibly default on the agreement. Investing in Gold ETFs does not give you an exposure to gold. When you invest in a gold ETF you are buying the shares of the Trustee, that is you are a shareholder of the trust and not a gold holder. Whereas investing in physical gold gives you direct physical ownership. Owning physical gold not only provides an investment hedge against inflation and rising rates but also allows investors to have full control over their gold investment. If you are more risk-adverse, investing in physical gold is a better option.

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