How does one invest in gold?

[stressor]

totally naive, but how you invest in gold? is it actually held somewhere if you buy?

Moderator Message:
Topic has moved away from TA so moved here. - Chris

[staffordian]

totally naive, but how you invest in gold? is it actually held somewhere if you buy?

I'm no expert but there are two basic ways.

The first is to buy holdings in gold related firms, funds etc. I know next to nothing about this.

The second is to physically hold gold, either yourself or have it kept by the dealer. I don't fancy this latter option, though I dare say there are many reputable companies offering this.

Holding it yourself, the key choice is bullion or coin. My choice is coin, speciffically used sovereigns, which attract neither VAT nor CGT on sales, whereas bullion does.

https://www.hattongardenmetals.com/ were recommended to me and I found them easy to deal with for both buying and selling. No conection other than as a satisfied user.

Hopefully an expert will be along to add flesh to these very bare bones.

Staffordian

[ReformedCharacter]

There are gold ETFs such as iShares Gold Trust:

https://www.ishares.com/us/products/239 ... trust-fund

And companies that will sell\buy and store bullion for you, doubtless there are some in the UK, but the Perth mint seems to be well regarded:

https://www.perthmint.com/invest.aspx

RC

[Mercenary]

Gold and gold miners are two totally different things. Some may argue one is a leveraged play on the others, some do not.

But IMO gold is (international) money, and I look to this to remind me:

https://goldprice.org/



For me, it's been a decent buy and hold (as part of an appropriate asset allocation strategy), as long as I buy at the right time!

[stevensfo]

totally naive, but how you invest in gold? is it actually held somewhere if you buy?

I'm no expert but there are two basic ways.

The first is to buy holdings in gold related firms, funds etc. I know next to nothing about this.

The second is to physically hold gold, either yourself or have it kept by the dealer. I don't fancy this latter option, though I dare say there are many reputable companies offering this.

Holding it yourself, the key choice is bullion or coin. My choice is coin, speciffically used sovereigns, which attract neither VAT nor CGT on sales, whereas bullion does.

https://www.hattongardenmetals.com/ were recommended to me and I found them easy to deal with for both buying and selling. No conection other than as a satisfied user.

Hopefully an expert will be along to add flesh to these very bare bones.

Staffordian

Willing to be corrected, but I don't think that sovereigns are any different from gold bullion wrt VAT and CGT. Actually, most sovereigns these days, unless old and having some numismatic value, are considered as gold bullion. I would always advise to buy the cheapest you can. If the smelly stuff hits the fan, nobody will be interested if it's an American Eagle, Britannia, Chinese panda or Krugerrand. I think that physical gold is great for collecting and leaving to your kids, but can't see the point in including physical in a real portfolio. Best use an ETF or IT.


Steve

[PinkDalek]

Willing to be corrected, but I don't think that sovereigns are any different from gold bullion wrt VAT and CGT. Actually, most sovereigns these days, unless old and having some numismatic value, are considered as gold bullion. ...

I've no idea about VAT*** but here are HMRC's views on CGT:

https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg78305

This part is probably what staffordian was summarising when sovereigns were mentioned:

Sovereigns minted in 1837 and later years and Britannia gold coins are currency but, like all sterling currency, are exempt because of TCGA92/S21 (1)(b).

Coins (including pre- 1837 sovereigns) which are not legal tender are not currency. They are chattels and qualify for the chattels exemption in TCGA92/S262. A gain on such a coin is therefore exempt if the disposal consideration does not exceed the limit in CG76573. ... [the limit is described here https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg76573]

I'm not sure that numismatic value comes into it.


*** VAT - plenty to study here:

Gold acquisitions, imports and investments (VAT Notice 701/21)
https://www.gov.uk/guidance/gold-acquisitions-imports-investments-and-vat-notice-70121

[Lootman]

I'm not sure that numismatic value comes into it.

I dabble in coin collecting and the general view is that the value of the underlying precious metal in a coin sets the base value for it. The coin may be worth more because of rarity or other numismatic value. But it is unlikely to be worth much less since, if it were, then you would melt it down for the constituent metal value. This means that older coins can be worth more partly because there are fewer of them around but also because they typically had a higher gold, silver, bronze or copper content.

But more generally I agree. You invest in coins that you believe have potential for appreciation of their numismatic value. If you want to invest in gold or silver, then do that in a cleaner way. My preference is gold mining companies like Newmont (NEM) and Barrick (ABX), aggregators like Franco-Nevada (FNV) and Wheaton Precious Metals (WPM), and ETFs that invest in such companies like GDX and GDXJ. Many of them pay a dividend whereas gold does not.

[PinkDalek]

I'm not sure that numismatic value comes into it.

I dabble in coin collecting and the general view is that the value of the underlying precious metal in a coin sets the base value for it. The coin may be worth more because of rarity or other numismatic value. ...

I should have been clearer. I meant I’m not sure that numismatic value comes into it when considering whether or not any gain on the asset is potentially chargeable to CGT (numismatic having been mentioned by stevensfo in conjunction with old).

[staffordian]

totally naive, but how you invest in gold? is it actually held somewhere if you buy?

I'm no expert but there are two basic ways.

The first is to buy holdings in gold related firms, funds etc. I know next to nothing about this.

The second is to physically hold gold, either yourself or have it kept by the dealer. I don't fancy this latter option, though I dare say there are many reputable companies offering this.

Holding it yourself, the key choice is bullion or coin. My choice is coin, speciffically used sovereigns, which attract neither VAT nor CGT on sales, whereas bullion does.

https://www.hattongardenmetals.com/ were recommended to me and I found them easy to deal with for both buying and selling. No conection other than as a satisfied user.

Hopefully an expert will be along to add flesh to these very bare bones.

Staffordian

Willing to be corrected, but I don't think that sovereigns are any different from gold bullion wrt VAT and CGT. Actually, most sovereigns these days, unless old and having some numismatic value, are considered as gold bullion. I would always advise to buy the cheapest you can. If the smelly stuff hits the fan, nobody will be interested if it's an American Eagle, Britannia, Chinese panda or Krugerrand. I think that physical gold is great for collecting and leaving to your kids, but can't see the point in including physical in a real portfolio. Best use an ETF or IT.


Steve

This summarises things...

https://www.royalmint.com/invest/bullio ... explained/

[BobbyD]

https://www.hattongardenmetals.com/ were recommended to me and I found them easy to deal with for both buying and selling. No conection other than as a satisfied user.

Using https://www.royalmintbullion.com/Produc ... annia/Gold might provide some ease for those with a little less confidence.

[Lanark]

Bullionvault.com is not a bad option, the storage charges of 0.5% are similar to many ETFs but far more secure because you are buying physical gold.

If you buy and hold physical with a typical buy-sell spread of 6% then after about 10 years the costs will be lower than using Bullionvault.

[Bouleversee]

I'd like to know how I get rid of gold, my certificated 100 AngloGold Ashanti shres that is, which are no longer registered on the LSE. I have paid no attention to them this year as I had more important things to deal with but I need to tidy up my affairs and I see they have recovered some of their losses this year so maybe this would be a good time to sell them (unless I am persuaded there is further to go), but how? I paid £32.13 p.s. in 1989, adjusted for rights issue, now £22.20. Not my best investment!

[PinkDalek]

I'd like to know how I get rid of gold, my certificated 100 AngloGold Ashanti shres ...

Contact your broker or Computershare Investor Services PLC (the UK Registrars)?:

https://www.anglogoldashanti.com/investors/share-info/#1502892218237-c49f2ca8-9889 (if the link functions)

Here should be their (expensive) dealing costs for Certified https://www.computershare.trade/cs/pdf/Computershare%20charges%20-%20Cert%20dealing%20and%20Corp%20Nominee.pdf (again if the link functions)

[Bouleversee]

Thanks, PD. I know that neither of my brokers will handle but will try Computershare. As you say, expensive, but Hobson's choice.

]

[Bouleversee]

I see AngloGold Ashanti are down over 4% today. I wonder why when everyone says gold is shooting up to record highs. The difference between shares in a lousy company and bullion, I suppose.

[Bouleversee]

According to my notifications TJH has replied to my last post but his post doesn't seem to exist.

[staffordian]

According to my notifications TJH has replied to my last post but his post doesn't seem to exist.

Might it have been a private message rather than a reply to the post?

[Bouleversee]

No, it wasn't.

[tjh290633]

I made a post which was incorrect and deleted it. I had mixed up Ashanti and Anglo-American.

TJH

[Bouleversee]

Not to worry. I mix things up all the time. Perhaps you were going to say the drop was because of their proposed deal with Sirius, though i think that recovered a bit by the end of the day. k