In wealth management, it has been proven over and over again that gold not only adds glitter to an investment portfolio but also stabilizes it. When you hold gold bullions, you can ensure a safe investment portfolio. That’s why many wealth managers advise their clients to allocate a certain part of their money in the precious yellow metal.
In this article, you’ll learn how you can maximize your return on gold bullion investment. You can learn more about buying and selling gold by referring to the precious metal websites like https://www.goldbullionaustralia.com.au/.
Go For Several Smaller Units Rather Than One Big Piece
When buying bullion, you’d have the choice of purchasing different sizes and ounces of gold. You’d have to choose between a bullion bar and a bullion coin. While both of them offer the same benefits, there are a few differences too.
Generally, coins are smaller in size and weight. To maximize the returns on gold investment, it’s better to invest in smaller coins. The reason being they sell at higher premiums than bars. Moreover, they’re easy to sell and recognized all around the world.
Another difference between smaller and larger gold units is liquidity. Large units like the 400 troy ounces are relatively illiquid because of their large size. They’re harder to sell and have to go through lengthy regulatory compliance. If you wanted to sell 10% of it, then you cannot slice a part of it and sell.
But with smaller bullions and bars, you can sell quickly and sell as much as you want.
Buy More Bullion Just Before a Recession
Whenever there’s a recession crisis looming around, investors turn to gold for safety. That’s because gold is an excellent hedge instrument. They’ll protect anyone against losses because they rarely depreciate like stocks, bonds, or currency.
So in a recession (or just before that), investors tend to buy more gold bullions. That’s when the price of these bullions increases. You can take advantage of this imbalance of supply and demand and make a considerable profit.
Even though predicting a recession with utmost accuracy is not possible, there are certain metrics you should look for. For example, financial cycles and term spread can provide signals that a recession is near.
Look For Long Term Upward Trend
The price of gold, just like any other trading asset, is decided by supply and demand. If demand exceeds supply, the prices tend to rise. And that’s where you can maximize your gold bullion investment by selling them off.
One advantage of trading precious metals is that they are used in electronics, healthcare, and aerospace.
When there’s a regulatory change or technological breakthrough, it’s the time when the price of gold increases. Therefore, you should be looking out for those kinds of news to maximize profits.
Always Have a Mix of Gold Assets
Investing just in gold bullions might not be an ideal strategy. Make similar investments in Gold mutual funds, ETFs, and sovereign bond schemes for the best investment portfolio. These investment types react differently to market fluctuations. Thus, you’ll have more flexibility when it comes to buying and selling gold.
You can purchase gold bullions in multiple ways. You can even walk into a pawn shop and acquire some coins. But the best way is to purchase online and work with a reliable dealer. They store the gold in a vault on your behalf. And thus, you can rely on them for safety.