There are various investment options when you’re looking to strengthen your portfolio but one of the best ways is using precious metals. The top choices include gold, silver, and platinum. These are rare metals with high value, making them always available. Their economic value includes their use in various applications, including technology, industrial processes, and even the fashion industry.
Because they are always in demand, these precious metals are excellent options for anyone who wants to make a good investment or diversify what they already have. So, how do you invest in these rare metals to be sure you’re taking the right step? There are a few ways to do that, such as buying bullion and coins or investing in intangible products, but they can be grouped into two categories.
Physical Products
You can buy gold, silver, platinum, and even palladium as physical products. These products include jewelry, coins, and bars or bullion. There is the option of holding the products in storage for yourself, which means you can physically see them when you like, or having the dealer secure a storage space for them and you can inspect them from time to time.
The good thing about precious metals is that holding them in storage does not depreciate their value over time. Other factors, like economic trends and market demand, are responsible for shifts in prices and value. So, you can hold them for as long as you want without worrying about damage or loss of value.
Investment Products
The second category under which you can invest in these rare metals is investment products. These include futures contracts, mutual funds, and exchange-traded funds (ETFs). You can access them through channels like mining companies and royalty companies because they sell shares and other products as mentioned above from time to time and the value of the precious metals determine the value of these investments over time.
We would like to point out that when choosing a precious metals dealer, ensure you carefully choose using a small list of criteria. You must see if they are a good company by reading reviews from past clients and checking review sites like Trustpilot and Yelp. Other places to verify their reputation and service record are Better Business Bureau and Consumer Affairs.
Which Is the Best Metals to Invest In?
As mentioned, the most popular ones are gold, silver, and platinum. Palladium is also a viable investment and gives you room to diversify instead of putting all your assets in one place.
Gold
The love for and popularity of gold goes beyond how beautiful and valuable it is when used in jewelry. The metal doesn’t corrode, making it highly durable. It’s also a great conductor of electricity and heat, which makes it valuable in several industries and pushes up its demand.
Moreover, its use in electronics and dentistry diversifies its value so that those who mine it are always in business. But it’s the use of gold for jewelry that is the most popular, mostly because jewelry is an excellent way to hold the precious metal instead of in its raw or bullion form.
Gold is the first option for investors who want to use precious metals as a way to hedge against inflation or as a way to save their assets during times of uncertainty in the political or economic spheres. Note that buying gold in any form is not cheap so your capital should match the market price if you want to make a significant investment.
Silver
This metal comes second only to gold, despite the difference in their physical appearance. There are several reasons it is well loved and valued, including its durability, storage strength, non-corrosion, and usage in industries like photography and the electric power industry.
One primary use of silver in the electrical industry is in solar panels. Silver powder is made into a paste and applied on a silicon wafer. Because this metal is an excellent electricity conductor – some experts say it’s better than gold – it carries electricity into batteries and for immediate use after light from the sun hits the silicon wafer and electrons are released.
That is why silver is highly valuable, contributing to driving up its price. It’s not as expensive as gold so it doesn’t require a large capital for investment. You can also store silver as jewelry, coins, bars, and silverware.
Platinum
Like silver, platinum is highly valuable in various industries, which is the primary reason it has a reasonable market and investment value. For example, it’s a crucial component for making catalytic converters, that part of a vehicle that reduces emissions. The electronic industry, specifically the computer sector, and the petroleum industry also use this rare metal for various purposes.
Because of its similarity to silver in appearance and durability, many jewelers use platinum for rings, earrings, bracelets, and other jewelry. While it’s not as sought-after as gold or even silver, it has a great store value and makes for a suitable investment option, especially if you want to reduce the risks of loss in the volatile gold and silver markets. Click here to learn more about investing in precious metals.
Why Should You Invest In Precious Metals?
There are many advantages to investing in precious metals. The most important one is its value. It’s a tangible asset that hardly ever depreciates because of its diverse uses beyond core investment purposes. They are highly valuable in different industries, as we have explained, which means they will always be in demand.
They always help hedge your assets against inflation, meaning their prices rise above or remain at the same level as inflation spikes. That way, investors don’t take a massive loss. Their liquidity is also a benefit. There is always a market for precious metals, especially gold and silver, so you’re not stuck when you need to sell them for cash.
In addition, they are a good way to diversify your investment portfolio because their prices don’t follow the stock market price changes. It’s a good way to have a stable portfolio, whether you choose physical products or investment options.
Conclusion
There are a few ways to invest in precious metals but they all fall under the physical products and investment options categories. Consider buying futures contracts, mutual funds, and exchange-traded funds (ETFs) or coins, bars, and jewellery to shore up your assets.
But before choosing which works best, engage the services of an industry expert to guide you through the market. Also, research and understand all you can about the market and keep an eye on the price changes to know the best time to put in your money.
