Why Invest in Gold ETF Instead of Buying Gold Coins

Gold is one of the top investments a person can put their money into. Traditionally, gold is stored and kept as an investment. Today, there is an alternative way to trade gold that can offer some additional benefits. People no longer need to buy gold coins and have them guarded. A lot of investors are now switching to Gold ETF’s. Gold ETFs are in essence open-ended mutual funds that invest your money in gold. People often call these funds paper gold. An investor can get a mutual fund that is equivalent to as little as one gram of gold. These managed funds follow the current pricing of gold in the market. The returns from Gold ETFs are basically the same as that of real physical gold. Since these are traded units, they can be used as a buy and sell product on the stock exchange. Some of these products allow physical redemption on investments. Investors should understand the different funds available. As with all securities, some are better than others.


More and more people are buying and trading in Gold ETFs rather than buying gold or gold coins. Investors find Gold ETFs easier to deal with because they no longer need special storage, such as a bank locker, to safeguard their investment. ETFs are not prone to theft or loss because they are not inherently physical items, unlike physical gold that can be stolen or misplaced. They also have relatively low overhead charges when bought, unlike real gold. These ETFs have high liquidity and are easier to sell than actual gold.


People who are already in the investment market can trade Gold ETFs smoothly. They can be bought and sold like equities. Owners of gold always have a fear of being robbed. Gold ETF’s are in paper form and retain their value for as long as an investor owns them. Another problem with buying gold bullion and coins is the possibility that gold they are getting is not pure or even real. With Gold ETFs, investors will have peace of mind knowing that they are always investing in 24 carat gold.


It is important to take note that there are certain requirements needed to invest in this type of mutual fund. Investors will need to pay annual maintenance charges and there is also a risk involved in this type of ETF, as with any type of structured financial investment.

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