Gold Investment Options
- Parent Category: WSO News
- Published: Wednesday, 13 February 2013 16:12
Since before the invention of the written word, human beings have traded the precious metal gold in the form of coins and jewelry. It has been prized through the ages for its shiny warm color and malleability which make it attractive in jewelry and artistic decoration. For centuries gold coins served as currency and until recent history paper currency was still linked to the gold standard. Gold is also valuable due to its many industrial uses in electronics and medicine. Because of gold’s nature as a hard asset, it can act as a hedge against inflation: when inflation is high and currency loses value, gold remains immune to inflation and gains value. Also, with vast quantities of gold already stored above ground in comparison with the annual quantity of newly mined gold entering the market, the value of gold is driven almost entirely by demand rather than supply. Gold is priced in US dollars, and has an inverse relationship with the dollar: when the value of the dollar rises, the value of gold dips and vice versa. Gold is a popular form of investment through three main avenues: 1.) the purchase of actual physical gold, 2.) the purchase of gold shares through an Exchange Traded Fund, and 3.) gold options.