Interested in buying gold?  Despite the run-up on gold, given the instability of markets and fiat currencies, we are still bullish ourselves.  However, as gold gets popular, the risk of buying gold goes up, especially given the scams out there.  Here are some of the best ways to buy gold:

  • Physical Bullion – the safest way to own gold is to buy the physical metal.  If you can afford bars, go for it.  However, buying gold bullion (commodity coins, not numismatics or premium/collector coins) is your best bet.  It is physically in your possession so there is never any worry about accounting trickeration (i.e. not having metals to backup a representative stock/fund).  Find a reputable dealer and buy from him (see note below).
  • CEF – Central Fund of Canada – the “sound monetary fund”, we have read from reputable sources that they indeed do have physical bullion to back their shares.  Only buy when the net asset value is under a +5% premium.  Note that this fund has a mix of gold and silver.  (if you want gold only, try GTU, the gold trust fund)
  • GLD – the SPDR Gold Trust, meant to track the price of gold.  If you have no other option, this is your best bet.  It is unclear if they actually have the bullion to back them up.

Another fund to consider is ZGLDUS.SW, based out of a reputable Swiss bank – many brokers can buy this but the commission will be much more.

As for a reputable bullion dealer, an easy way to check is to call and ask the broker for the cheapest gold you can buy – he should steer you towards bullion (commodity Mexican Pesos, Krugerands, etc.) and not charge 6% over spot.