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How to Invest in Gold ETF Wisely

Updated on July 3, 2011
now you can invest in gold without having to worry about the hassles
now you can invest in gold without having to worry about the hassles

It is true that gold often turns out to be quite a wise choice when it comes to the investment market. However, it is not recommended that the investors keep a large pile of gold bars with them. This is not really an efficient method after all. The better choice instead is that the investors try to invest in gold ETF. However, there are quite a few things that the investors will have to know in advance with regards to investing their hard-earned money in gold ETF.

So, to start it off, the investors will first have to know what gold ETF really is. Simply explained, gold ETF is the fund exchanged in a trade in which gold turns out to be the only commodity involved. However, though, the investor will have to keep in mind that by investing in the gold ETF, they do not necessarily invest in a gold bar. Instead, what they are actually investing their money in is an asset with gold backing it.

Then, the next thing that the investors should do is to choose what kind of gold ETF they want to invest their money in. In most cases, GLD is the best choice. It is known as a spider ETF as well. As a large number of financial advisors as well as analysts see gold as a requirement when it comes to someone’s portfolio, the investors can use the gold ETF as a mean to minimize risks in their portfolio.

The next thing that investors should consider as well is to distribute the risks that may exist in the gold ETF. This is often a better choice compared to putting all the money they have earned at risk with just a single gold company. This also gives the investors a good advantage. For an example, when there is a rapid increase in the price of gold, the investors won’t have to bother losing their money due to a gold company doing bad in business. This is because with the gold ETF investment, all the investors will have to care about is the gold price.

The good thing about investing in the gold ETF is that it is not hard at all to do. The investors only have to access their brokerage account online and then place their order as they would a stock. They only need to choose the gold ETF they want to invest in and enter its ticker symbol. Afterwards, they can feel free to place their order.

However, there may also be times when the investors do not have any access to the internet. Fortunately, this does not necessarily mean they won’t be able to purchase the gold ETF. In fact, for their convenience, they can place their order by phone.

With that being said, the investors simply need to jot down the ticker symbol of the gold and its price. Then, they can make a phone call to their broker and pass the information to the broker. Of course, the investors will also have to tell the broker the amount of shares they are planning to invest in.


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