by B.J. Tolentino

Created on: February 09, 2010

Gold is a liquid form of investment and is usually incorporated in investment portfolios to hedge against other market positions. This is especially true when you have exposures in the currency and stock markets. But if you are planning to invest in gold as a primary investment vehicle, then timing is the key - as they say “Buy Low, Sell High”. But then again, it is not as simple as that. Lows and highs happen every hour – minutes even.

There are many gold investment products to choose from and they are primarily classified as “physical” and “paper” gold investment products. The appropriate gold product to invest in depends on how much you are willing to invest in, and how long you are committed to stay in the market. Deciding on your gold investment plan needs careful study - if not, an expert’s advice. Whichever step you take, starts with knowing the different gold investment products available in the market today.  

Physical Gold

Physical gold is gold which is in your possession and control. It is most often in the form of gold bullion and it is what most prospective gold investors start investing into. To invest in gold bullion means investing in gold bars and gold coins. Modern day gold bullion is easily distinguishable and therefore easily traded since they are carefully produced and marked according to specific standards.

Gold bars are imprinted with their manufacturer’s name together with their weight and gold content. Gold coins are also marked with their weight and minted with standard gold contents according to its class as specified by the issuing Mint. Most gold coins have imprinted face values but they are never really used as legal tenders since their gold content have much higher market values.

Rare gold coins are also physical gold investment products. However, their market value is higher than their equivalent gold content. Unlike gold bullion coins, they are priced according to their rarity and numismatic values which have been standardized by numismatic scholars and coin grading bodies. Any investor on rare gold coins must know how to determine what makes a coin rare and worth as much in order to make the most of his/her investment.   

Paper Gold

It may be true that most people don’t understand the other types of gold investment products aside from gold bullion and rare gold coins. But in the broader financial world, paper gold is the more heavily traded

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