Trading Gold or shares?

Over the long term, the S&P 500 clearly beats gold. In times of crisis, however, things can look different, as a look at the financial crisis shows. Here, gold has proven itself as a crisis currency:

What about currency risk?

There is a currency risk with an investment in gold. This is due to the fact that the gold price is quoted in US dollars. If the ratio of the euro to the dollar changes in Exness South Africa, this has a direct impact on the return. A rising gold rate can lead to a negative return if the euro-dollar rate falls.

Find a storage location for physical gold

When buying gold in physical form, one should observe some basic conditions in order to be able to skim off all the advantages from the form of investment. The first consideration should be where the purchased gold will be stored. After all, physical means tangible. Probably the most sensible solution is to store the purchased gold in a security deposit. Especially if you do not have the appropriate security facilities in your own home, such as a suitable safe.

Furthermore, storing gold in your own home exposes you to a certain risk. After all, a burglary or even a robbery can occur, which can quickly put one's own health at risk. On the other hand, with this type of storage, you definitely know where the gold is and do not have to worry about anything. Those who opt for this type of storage alternative should also increase their insurance accordingly. It is not advisable to store gold within one's own four walls if there is not even a safe available. Although it is possible to look for the most creative hiding place possible, such an approach is definitely not safe - on the contrary.

Much more obvious and sensible, on the other hand, is to store the physical gold with an external security company. Storage in a safe deposit box is also conceivable. In this case, however, it is important to have sufficient insurance (often insurance cover is available for up to 20,000 euros). In the meantime, there are also "all-inclusive packages" for convenient purchase processing. Such a package is offered, for example, by Cosorsbank in cooperation with proAurum. The physical gold is purchased from Consorsbank and subsequently stored in proAurum's high-security custody account. Of course, it should be noted that this alternative solution incurs fees for storage and settlement, which reduce the return.

Physical gold: Pay attention to denomination!

Gold in physical form is primarily bought out of fear of crisis. When confidence in the currency and the economic system as a whole wanes, investors turn to tangible assets such as precious metals. And it is precisely this idea that should be taken further: If the system collapses and money as such is no longer worth anything, it is conceivable that, among other things, payment will be made with precious metals such as gold. But what good is a 1-kilo bar in this situation, for example, if you want to pay for your bread or a simple service with it? Nothing. And that is exactly why you should pay attention to a sensible denomination when buying your physical gold.

One possibility is to buy a larger number of small coins or mini-bars, although the mark-ups are of course higher here. When buying coins, make sure that they are common investment coins such as the Philharmonic or the Krugerrand. As a rule, it is much easier to sell these coins at a later date. It is also possible to buy so-called combi-bars. These are bars that have predetermined breaking points so that they can be broken down into many smaller pieces if necessary without loss of value and greater effort.

So the question arises: be optimally prepared for upcoming crisis situations with a small denomination and pay sometimes significant premiums for it, or fall back on larger units, give up some flexibility and get better prices?