Your Gold Buying Guide

Alexander Boulden

Updated May 28, 2024

This Memorial Day, why not do yourself a favor and diversify your portfolio into gold and precious metals?

No, really.

All the cool kids are doing it…

Millennials and Gen Z are reportedly buying up to gold just like the central banks around the world, causing a new gold rush.

The reason? To build wealth.

Because the dollar ain’t cutting it today.

Youngsters in China are leading the charge, with Gen Z accounting for 55% of gold purchases in the country.

So if you haven’t been taking gold seriously, you might want to seriously take a look.

Experts are predicting gold will hit at least $3,000 this year.

It’s because of many factors — one, of course, being that inflation has eroded the purchasing power of the dollar, and that inflation is sticky, meaning it won’t be going away anytime soon. The data from the Fed supports this as well.

There’s a popular and easy-to-understand saying about why gold is a such a good place to put your money.

Gold bugs often say that an ounce of gold can buy a nice men’s suit.

It’s sometimes called the gold-to-suit ratio.

Today a very nice men’s suit would cost roughly $2,000, roughly the price of an ounce of gold today.

Back in the early 1900s, an ounce of gold cost roughly $20, which would’ve bought you a very nice men’s suit at the time.

Now, there are obviously some qualms with this argument because you have no way of knowing the exact price or quality of a suit back then. And you can certainly buy a nice suit today for less than $2,000.

But it’s one way of proving that gold holds its value over time relative to inflation.

My rule of thumb is to have roughly 10% of your portfolio in gold and silver.

Now, there are a few ways you can do this, which I’ll get to in a minute.

First, let’s just briefly touch on the top five reasons gold and precious metals are a good buy.

  1. Diversification: Gold offers you a way to diversify your investment portfolio. It tends to have a low correlation with other assets such as stocks and bonds, so during times of economic uncertainty or market downturns, gold often acts as a safe-haven asset, providing stability to your overall portfolio. Keep in mind that gold is relatively volatile but trends up over longer periods of time.
  2. Hedge against inflation: We touched on this a bit already, but gold historically has served as a hedge against inflation. When the purchasing power of fiat currencies declines due to severe mismanagement from corrupt governments (what’s happening today), the value of gold tends to rise. Therefore, holding gold can help preserve the real value of wealth over the long term.
  3. Store of value: Gold has been recognized as a store of value for centuries. Unlike paper currency, which can be devalued by governments or central banks through inflationary policies, like money printing, gold maintains its intrinsic value over time. This makes it a reliable asset for preserving wealth across generations. When you buy gold, you’re really buying it for your future estate.
  4. Liquidity: Gold is highly liquid, meaning it can be easily bought or sold in various forms such as coins, bars, or exchange-traded funds (ETFs). The global gold market is deep and active, allowing investors to quickly convert their gold holdings into cash when needed, often without significant loss of value. The key here is to buy low and sell high!
  5. Geopolitical uncertainty: In times of geopolitical tensions or economic crises like we’re facing now, investors often flock to gold as a safe-haven asset. Gold is considered a reliable store of value during turbulent times, as it is not subject to the political and economic risks associated with individual countries or fiat currencies. The same argument can be made with Bitcoin, but it’s been leveraged to the U.S. markets recently and has lost its edge as a safe-haven asset.

Buying and Selling

Let’s touch on smart ways to buy and sell gold.

It can be easy to get caught up in the hype and just plop down your credit card and buy up gold at your local gold store.

But stores will often add tax for using a card, so make sure you buy in cash (this comes with the added benefit of staying anonymous).

Buy high-quality coins that are globally recognized in the gold market.

These include:

  • American Gold Eagle: Issued by the United States Mint, the American Gold Eagle is one of the most widely recognized gold coins globally. It contains 91.67% pure gold and features iconic designs such as the Liberty design on the obverse and various depictions of American eagles on the reverse.
  • Canadian Gold Maple Leaf: Produced by the Royal Canadian Mint, the Canadian Gold Maple Leaf is esteemed for its exceptional purity, containing 99.99% pure gold. It features the iconic maple leaf design on the reverse and Queen Elizabeth II on the obverse.
  • South African Krugerrand: First minted in 1967, the South African Krugerrand was the world’s first modern bullion coin. It contains 91.67% pure gold and features the portrait of Paul Kruger, the former president of the South African Republic, on the obverse, and a springbok antelope on the reverse.
  • Austrian Philharmonic: Issued by the Austrian Mint, the Austrian Philharmonic is renowned for its elegant design featuring musical instruments from the Vienna Philharmonic Orchestra. It contains 99.99% pure gold. The obverse side of the coin displays the Great Organ of the Golden Hall in Vienna’s Musikverein concert hall.
  • Chinese Gold Panda: Produced by the China Mint, the Chinese Gold Panda is highly sought-after by collectors due to its annually changing reverse design featuring adorable pandas. It contains 99.9% pure gold.

Keep in mind you will always pay a premium for gold. You can limit the premiums you pay by buying ounces instead of one-quarter or one-tenth ounces. Not everyone has that kind of cash laying around, so tenth ounces are very popular and tend to sell out. And don’t forget about silver as well.

Of course, the rule of thumb is to buy low and sell high!

If you don’t feel like shelling out your hard-earned cash for solid coins, then gold mining stocks or precious metals ETFs might be right for you.

Hope this gives you a starting point to dip your toe in the gold market.

Have a great Memorial Day!

Stay frosty,

Alexander Boulden
Editor, Wealth Daily

follow basicCheck us out on YouTube!

After Alexander’s passion for economics and investing drew him to one of the largest financial publishers in the world, where he rubbed elbows with former Chicago Board Options Exchange floor traders, Wall Street hedge fund managers, and International Monetary Fund analysts, he decided to take up the pen and guide others through this new age of investing.

Alexander is the investment director of Insider Stakeout — a weekly investment advisory service dedicated to tracking the smartest money on the planet so that his readers can achieve life-altering, market-beating returns. He also serves at the managing editor for R.I.C.H. Report, a comprehensive service that uses the highest-quality investment research and strategies that guides its members in growing their wealth on top of preserving it.

Check out his editor’s page here.

Want to hear more from Alexander? Sign up to receive emails directly from him ranging from market commentaries to opportunities that he has his eye on. 

P.S. There’s a little-known catalyst that could send gold prices even higher this year. It’s that the Fed could make the greenback illegal tender. If that happens, gold will soar to the moon. Check out the full story here.

Angel Publishing Investor Club Discord - Chat Now

Alexander Boulden Premium

Introductory

Advanced