stock Market How to Invest Gold by truth4reviews


									How To Invest in Gold

The diversified portfolio has a small position in the gold market. For
some investing in gold means holding gold coins. Some speculators buy
gold contact futures on the commodity exchange. Future contracts are
risky because you are betting that the price of gold will go higher in
the future. The contract requires a relatively small up front payment,
but there can be daily fluctuations that require you have funds to back
the dips in the price of daily gold.

The reasons investors have been interested in gold is that the old
reasoning was that if the stock market was down the gold market was
generally up. This reasoning has become a possibility, but not an axiom
of the current marketplace. The weakness in the dollar generally brings
a surge in the price of gold. The current price for gold is in the range
of $670. Prices have fluctuated within a range of $664 and the current
high of $672. Traders think gold could easily go as high as $1,000 an

Investing in gold stocks and precious metal index funds can be purchased
through a stock broker. A stock broker specializing in this area is very
important because the investment needs savvy investment advice. Most of
the larger brokerage houses have individuals that are specialized in the
area of commodities and precious metal stocks.

There are certain international gold stocks that are noteworthy. A
Canadian based international player in the gold market is Agnico-Eagle
Mines. It trades on the New York Stock Exchange and the Toronto Stock
Exchange under the stock ticker AEM. The stock is also sold on the
Frankfurt Stock Exchange. This company has more than a thirty year
history in the production of gold. Since the 1970s AEM has produced over
four million ounces of gold. The company is international and has
operations in Canada, United States, Mexico, Sweden and Finland.

Other noteworthy gold stocks include; Barrick Gold Corp, Goldcorp Inc.,
Kinross Gold Corp., and Newmont Mining. All of these gold stocks are
currently trading on the upside, but it is advisable for all investors to
make sure these stocks fit your investment risk potential.

In recent years the price of gold has been as low as the $450 an ounce
range. Since the late 1970s gold has made huge profits for holders of
gold. The key to owning gold is to know the various resistance points
and to assess the global market for the use of gold. It is used primarily
in jewelry manufacturing and other types of manufacturing. Currently in
India there is a small slow down in the use of gold for jewelry making.
The same applies to a degree in China. Whether it is enough of a slow
down to effect the price of gold is uncertain.

Investors who trade in gold should seek the advice of an analyst that can
factor in all the various aspects that effect the price of gold. If you
own gold as a hedge against a weak dollar you should look for any
strengthening in the dollar. The important thing to remember is to gage
your investment in gold to a level that you are comfortable. If you
bought spot gold at $600 an ounce, you might consider a rise to $720 a
good profit. The ride to $1,000 an ounce may be bumpy and there is no
telling when it will reach that level if it does as speculators have

There are numerous gold mining stocks on the market and if you are
interested in a small investment you can find these stocks in the $5 to
$12 range The smaller gold mining stocks do carry a risk because a great
deal of overhead goes into making a mining company profitable.

The range of risk and amount you decide to invest in gold is a personal
choice. It is always advisable to seek the expert advise of a stock
expert or commodity expert before leaping into this market. Another sage
piece of advise I learned is to trust my sense of cashing out before the
price of gold drops significantly due to outside pressures or

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