View's please on holding physical Gold?

valuepack

I'm interested in buying gold as a portfolio diversifier because it's my understanding that it tends to rise if equities take a hit.

I looked up gold ETC's and my first impression was that it ticks all the boxes: I'll be investigating in physical gold so my investment will track the price of gold, but I won't have to mess about storing it.

However, I then read that the amount of "physical" gold in actual existence is much less than the total that all these ETC's claim to own. So, evidently, some people are telling porkies somewhere along the line.

Also, though one of the companies I was looking at was labelled an ETC, so I figured I'd be investing in precious metal as a commodity, it then goes on to be listed as a ETF.

I got a bit confused about whether I would indeed be diversifying or not by this point.

aroominyork

valuepack said:

I'm interested in buying gold as a portfolio diversifier because it's my understanding that it tends to rise if equities take a hit.

It's not as straightforward as that. Scroll down to the video https://pensioncraft.com/is-gold-a-good-investment/ at the 8 minute mark. This video was a few years ago and it has become increasingly complex since then, for example with central banks such as China's buying large amounts of gold. 

subjecttocontract

aroominyork said:

subjecttocontract said:

I've found that buying sovereigns at local auctions works well for me. I've picked up a few bargains this way.

Even given the scam of buyers having to pay commission?!

I'm not aware of any 'scams' regarding auction buyers fees. Auction fees are clearly identified along with any vat that's due on those fees. I've bought sovereigns which together with any buyers premium have been below market value......in my book that's a good result.

Nebulous2

This topic comes up occasionally. It's worth doing a forum search for previous threads. 

I have a Krugerrand I've had since the 70s. Here's what I posted last time I commented on a thread like this. 

Gold in your portfolio? - Page 3 — MoneySavingExpert Forum

valuepack

aroominyork said:

valuepack said:

I'm interested in buying gold as a portfolio diversifier because it's my understanding that it tends to rise if equities take a hit.

It's not as straightforward as that. Scroll down to the video https://pensioncraft.com/is-gold-a-good-investment/ at the 8 minute mark. This video was a few years ago and it has become increasingly complex since then, for example with central banks such as China's buying large amounts of gold. 

Thanks for this info.

Just goes to show that gold doesn't necessarily rise when stocks fall.

mika_dm

Gold rises mostly when Inflation goes up, not when stocks goes down.

Hoenir

aroominyork said:

subjecttocontract said:

I've found that buying sovereigns at local auctions works well for me. I've picked up a few bargains this way.

Even given the scam of buyers having to pay commission?!

Auction houses have to cover their operating costs and make a profit. The commission % is known not hidden. Just needs to be factored in when making a bid.