Alternative Gold Investments

Though there are many reasons to invest in physical gold, there are also reasons to limit your physical gold holdings. Physical gold holdings are expensive to store, can possibly be stolen and are difficult to quickly sell. However, there are other ways to gain exposure to and profit from the price movements of gold without buying physical gold.

As with any investment, you should carefully research the company or other investment vehicle before making a purchase. You can find assistance from a licensed investment professional as well as various government oversight organizations and private investment research companies.

Gold Mutual Funds and ETFs

Gold Exchange Traded Funds (ETFs) allow an investor a quick and easy way to invest in and sell gold quickly. Gold ETFs hold gold bullion and sells shares of the holding like a stock. You can also choose to invest in mutual funds that own gold related investments such as shares of mining, refining and related companies. Mutual funds are also easy to buy and sell, though the fees for the mutual funds are generally higher than the ETFs.

Gold Mining Stocks

The value of gold mining companies generally moves up and down along with the price of gold. However, these companies generally mine not only gold, but also silver, copper and other metals. This helps to diversify the company's revenues and stabilize the company's stock price. Gold mining stocks also move as a result of the company's specific gold production as the company exhausts the gold in one area and opens new areas. Though not as safe as the larger gold mining stocks, there are also numerous "penny stock" mining companies sold on the over the counter market. These companies are too small to be listed on the major exchanges and are extremely risky investments.

Gold Mine Supplier Stocks

There is an old saying about gold rushes. It states that the only people that make money are those who sell the picks and pans. While modern day gold rushes use more complex equipment, those selling the equipment are still making a profit. If you are looking to be a supplier, you should consider investing in the stocks of companies such as Caterpillar and Komatsu. There are numerous companies that supply the heavy equipment and other needed supplies to mine gold (and other metals and minerals), any of these companies may see an increase in stock prices as the demand for gold grows.

Gold Options

Investing in options is essentially placing a bet on whether a specific commodity, in this case gold, will rise or fall. Buying and selling options generally requires a large initial investment and nerves of steel, but for those with the cash and knowledge, gold options are another way to profit from the price movements of gold.