Gold Market Analysis – Top 10 Things Not To Forget!

Gold Market Analysis

Every investor entering the world of gold investing must not forget these 10 things that go into your gold market analysis:

1. Don’t get in over your head literally

Gold market just like any other commodity market has its own underwater rocks that you need to watch out for. Gold prices can rise and plummet within a matter of weeks or moths, gold mining companies can run out of cash and stop gold production, a million other market scenarios can come into a play. You simply can not risk all of your funds on one specific type of investment. Gold experts warn against investing more that 5-10% of your money into precious metals market.

2. Understand all gold investment options

You have so many options when it comes to investing in gold, namely, buying gold bullion, investing in gold ETF’s or mutual funds, purchasing gold shares or gold futures and the list goes on. Ultimately, the choice of your gold investing instruments will depend on your investment goals. Are you trying to profit from gold’s appreciating market value, save money or hold it for the long run? Perhaps you are trying to enter gold coins market for survival purposes. Define your goals and select your gold investment options carefully.

3. Diversify within your gold investment portfolio

No matter how complex that might sound to new investors, you must diversify even within your precious metals portfolio in order to maximize your investment potential. Acquire some bullion coins for insurance against falling US dollar, consider holding some gold certificates for savings purposes, invest in gold exploring or gold mining shares for potential profit and get into gold futures for speculative reasons. If you are not a gold market analysis expert, look into gold bullion for sale as one of the most solid foundations for any gold portfolio.

4. Don’t get lost in the world of numismatic coins

Frankly speaking, no matter what some crafty coin dealers are telling you, do not buy any numismatic coins for the purpose of gold investing. This simply does not work! At the end of the day you are investing into the gold weight and not “a story” behind some coins. Sure, some collectors make a lot of money on their numismatic coins but it took them years to learn how to recognize coins’ grade, purity and rarity factors. Gold investors should stick strictly to gold bullion coins and bars that derive their values from the gold content. Find honest and well known gold bullion dealers and buy from them. You can learn about top gold bullion sellers from reading a variety of articles on our website.

5. Do not overlook the Capital Gains Tax on your gold investment

Many investors, especially new ones, are so taken by the shine of their bullion coins and the gold market that has been steadily on the rise for a few years that they often overlook the matter of CGT on their gold. In fact, IRS treats your gold bullion as a “collectible” and taxes it accordingly at a hefty 28% rate. Investing in paper gold or gold ETF’s are also taxed at a higher rate. Gold stocks, however, do not fall into the category of “collectibles” making some investors choose them over the gold bullion market investment for this purpose.

6. Stay true to your market investing goals

With that said, if you got into the gold market for the long haul and see gold market price start coming down, you are not going to rush selling it. Absolutely no, on the contrary, you will consider buying more at the right time. Long term gold investors understand about the cyclical nature of the gold market and do not live off short trades. However, if you are in the gold market to profit from short sales, then you will employ an entirely different gold market analysis.

7. Avoid hot picks or friends advice

Gold market analysis should never be conducted using market hot picks or, worse, from advice of your well meaning relatives or co-workers. You need to understand that every investor has different preferences and investment goals in mind. Some invest in gold as hedge against devaluing currencies, others for investment gains. Therefore, it is essentials you do your own research and market analysis.

8. Do not discard other precious metals

There are other precious metals that are worth investing into besides gold. Some precious metals investing gurus predict silver to become just “another gold” in the near future and are actively buying silver bullion and silver shares. In fact, silver has much more industrial applications than gold, much rarer than gold and an indispensable component for manufacturing solar panel cells that have a huge potential of providing alternative energy sources in the future. Why not add some silver bars or coins to your possession?

9. Look at entire investment market

Gold market analysis should never be conducted in an isolated manner but rather as an integral part of major world economic trends, government policies and overall situation in the world. Only looking at the broader picture, you can get a feel and start speculating what’s in store for gold market in the near future.

10. Think about selling too

The last but not least thing not to forget when you make your gold market analysis and it is what to do if you want to sell your gold investment for various reasons. If you own gold bullion coins or bars, you can sell them back to your coin dealer. Although, not all coin dealers will buy back from individual investors, so you have to ask around. In case you would like to sell gold jewelry for cash and don’t know how much you can get, use an online gold scrap value calculator to get an approximate amount.