What is the Best Way to Buy Gold Bullion

Gold has been treasured by civilizations for thousands of years and has permeated cultures like India to which gold has become the one true status symbol.  As gold’s price has heated up during the bull market of the last 11 years more and more people/investors are looking at owning some gold in their portfolio.  There are a few types of gold you can buy but in this article we will talk about what is the best way to buy gold bullion.

Gold bullion is a type of gold that takes form in bars or coins.  Its value is derived primarily by its gold content along with a premium for being mined, minted and marketed, demand also plays a small role in its value.

Bullion Coins

Bullion gold coins are primarily those that have been minted within the last 40 years.  A few examples of bullion coins are the American Gold Eagle, Canadian Gold Maple Leaf, South African Gold Krugerrand and the Austrian Gold Philharmonic.  Do not confuse older U.S. gold coins like the Liberty Head or Saint Gaudens minted long ago as bullion.  Those coins carry a premium for their rarity.  Bullion coins do not carry a premium for rarity.

Bullion Bars

Bullion gold bars are minted by various private mints around the world.  A few examples are Johnson Matthey, Engelhard and Credit Suisse to name a few.  Gold bullion bars range in size from 1 gram all the way up to 400 ounces.  Gold bullion bars carry the lowest premium over the spot price than any other type of physical gold.  The larger the bar the less the premium over spot per ounce the bar will carry.  Therefore the cheapest gold you can buy would be a 400 oz. bar.

Best Gold Bullion

The best gold bullion to buy will depend on your goals.  If you are looking to buy gold for cheap, 1 oz. bars are probably your best bet.  If you are looking for gold that is recognizable here in the U.S. for bartering reason then 1/10 oz. American Eagles are probably good for you.  If you are hoping to put a very large sum of money into gold and are looking to ride the prices higher then a 400 oz. bar might work for you.  If you are looking to diversify among the asset class then you may want to consider buying a bunch of different types.

Gold bullion is cheap, liquid and easy to find.  You can’t go wrong with any of the different types, just stay away from graded gold bullion as it is a marketing scheme.

About Eric Griffin

Eric Griffin is the President and Co-Founder of www.GoldAndSilverOnline.com. Eric has been around the precious metals business since 1995 when his father started a leading nationwide precious metals dealer. While getting a finance degree from Arizona State University he helped his father with operations but decided to go into banking and finance when he graduated in 2002. He soon found his way back to the precious metals industry, and has written commentary, managed precious metals websites and managed clients portfolios for many years before opening GASO. Eric has a strong grasp on economics as well as a deep understanding of the precious metals markets. If you have any comments or questions don’t hesitate to respond to any of his blog post.




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