What is Precious Metal Trading?
A precious metal is a rare, naturally occurring element that holds high value. Examples of which are; gold, silver, and platinum.
Throughout history, precious metal trading has evolved. Trading, or bartering, was the first form of exchanging one possession for another. Many things have been traded in history, beginning with goods like animal hides and seashells (History credits the cities of Sumer with this system). Trading evolved into not just a necessity for life, but a luxury as well.
Global world supplies have grown very slowly and all of the above ground gold (extracted and refined) that exists today is considered the world’s total supply of gold. Why? - New Gold deposits are few and far between and considerable resources are required to extract (mine) and refine the raw material. Whilst the Gold supply remains at constant levels or increased slightly with new discoveries, the worldwide demand continues to grow. Demand? - It is used in things like jewellery making, medical research, industry, and precious metals trading.
So how can you invest in precious metals?
Firstly, you have to decide which metals provide the best solution to your individual circumstance since the are several types to consider, such as gold, silver, platinum, and palladium - Your Financial Adviser can assist you with this. Once you have decided on the type of metal, you must decide which form you want to buy. Typically these metals come in the form of bullion bars and bullion coins - which is the best option for you? This will depend upon your investment model.
Bullion bars are efficiently traded and carry a lower trading premium and can be bought in small or large sizes. Large bars are convenient for the established higher net worth investments. If you're new to the market and "testing" the market or don't have as much to invest, smaller bars or bullion coins may be your best option. As with any investment Select Global advises that you speak to your Independent Financial Adviser in order to ascertain which type of Investment Model would be most applicable for you.