Investing in Gold Bullion and Silver Bullion Insider Tips

Of all the forms of gold in which to invest, bullion is the least expensive. It is easiest to get into for the money, which sixes available form 1/10 ounce to a standard bar of 400 troy ounces. The most common investment size is in one ounce bars; 400 ounces are normally only traded between governments (and perhaps extremely rich individuals). Because the 1/10 size is extremely expensive to manufacture, it requires a hefty and unattractive premium. It's not a good idea to attempt to invest at the level.

Gold bullion can convert to cash very quickly, as do most other gold vehicles. The main drawback is the difficult in storing. Few people are able to provide vault storage in their homes and therefore would have to spend a small fortune to store the bullion in a safe place. Feel free to inquire at your financial institution about their safe deposit box storage policy.

The purest refined gold is referred to as "four nines", that is .9999 parts gold vs. .0001 part of something else. The chances are that the .0001 is not present at all but placed into the definition as a safeguard. In any event, if you purchase 400 ounces of .9999 gold, you will pay for 100% pure gold. However, if you buy gold assayed at .9990, for example, you'll pay less.

Only buy gold from a recognized dealer, never from a broker or a trader. A dealer buys and sells gold from internally owned holdings. While dealers do not charge commission, profit is made on the spread. This is the difference between dealer sales price and what you pay. Brokers work on a commission basis and do not own gold. So, that is an important question to ask upfront and verify prior to making any purchase. Traders work the market on behalf of the dealers and are allowed full power to act for the dealer with the dealers' money.

Importantly, gold from a well known well-respected dealer will be easier and cheaper to resell if you find it necessary to go to another dealer when selling. The likelihood is that gold bearing the mark of an obscure dealer will be subject to considerable assay fees.

Buy as large a bar as you can afford at one time, as opposed to buying several smaller pieces. There is a manufacturing charge for bullion that goes up as the size of the bar goes down. Nominal as the charge may be, remember that as an investor, you are a business person as well. Whatever you can save in the process of buying and selling, without compromising quality and safety, is to your advantage.

Silver bullion

Like gold, silver bullion comes in a wide size range, starting from 1 gram (31.1035 grams equals 1 troy ounce) and go up to a standard bar of 1,000 ounces. Silver works on a so-called "three times" purity scale (.999). And manufacturing costs exists for silver just as it does for gold. The cost is less per weight although it probably costs no less to pour a silver bar than it does a gold one. The reason, of course, is the relative cost of the metal itself. Because of that relative cost, you may actually be paying more per ounce for silver.

Dealer Selection

Of course, your selection of a metals dealer should be based on experience and on versatility of investment vehicles. Avoid the new dealer who may not have the time to devote to your individual needs while they build their business. It would be well to remember that the quality and reputation of a true dealer takes a long time to develop.