Gold is popular as an investment. And if you buy gold, you can't go wrong. Or? You bet! An overview of some basic tips for buying gold.
- Beware of fraudsters: you should clarify these points
- The importance of gold
- Gold alone does not make you happy
- The best investment: real assets or shares?
- Physical gold ownership and its special advantages
- Acquisition of gold is possible anonymously
- No Europe without borders
- Shares vs. gold
- Gold anecdote: stewards as smugglers
- What factors are driving the markets?
- 5. Central bank purchases and sales
- Top books on the subject
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Beware of fraudsters: you should clarify these points
Brazen fraudsters are now bringing counterfeit bars and coins onto the market in such a sophisticated way that they are sometimes not even recognized by bank employees. In fact, it doesn't matter and is just a matter of your personal taste whether you buy Krugerrand, Philharmonic or Maple Leaf coins. But the important thing is where you buy. And last but not least: where you can, if applicable sell and get a reasonable price. For example, some things to look out for are:
- How should your gold investment be optimally structured?
- Where is the best place to keep your gold treasures?
- What insurance coverage is there?
- Is gold jewelry a worthwhile investment?
- Why does the Krugerrand shimmer red-gold?
- What are the different alloys all about?
- Why is white gold white?
- How can you buy gold anonymously through completely legal bar shops?
The importance of gold
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But maybe you don't want to buy physical gold, i.e. coins or bars, and prefer to invest in "golden securities" - from gold mines.shares via gold certificates, ETCs and ETFs to derivatives.
For some, gold is just a form of investment that is just as rational as, for example, a share. For others, gold - and not just in the form of jewelry - also has a high emotional added value, which can sometimes lead them astray. "All my life I have loved its color, its shine, its divine heaviness," enthuses Goldfinger in the James Bond film of the same name. In the end, he was not happy with it, as all 007 fans know.
Gold alone does not make you happy
The same applies to the legendary Midas, according to the Greek legend the son of Gordios and Cybele, who - according to myth - is said to have been as greedy as he was stupid. In order to at least compensate for the latter handicap, he captured the wise Silenos. But Midas could not benefit from his cleverness, on the contrary. When Dionysus, a disciple of Silenus, asked the king to release the prisoner, he had to grant Midas a wish: henceforth everything he touched should become gold. The wish was granted to him - and the greedy Midas was soon to discover that gold cannot be eaten or drunk. If bread and fine wine turn into gold at the moment they are touched, there is a risk of starvation and dying of thirst.
These two anecdotes make the ambivalence of the yellow precious metal clear. On the one hand, there is much to be said for allocating part of your assets to gold, which will retain its value over the long term invest, which also has tax advantages, as I will explain to you in a moment. On the other hand, too high a proportion of gold in the depot can increase Risks represent. Because sometimes the fluctuation intensity of the precious metal (volatility) is even more pronounced than with shares. An example: In 2013, the price of gold fluctuated between 1.670 and 1.220 US dollars. That still made a difference of 37 percent. Remember, if the price of gold falls 50 percent, it must then gain 100 percent to get back to where it started. In the long term, however, gold has proven to be very stable in value. It survived wars, economic crises and currency reforms. Therefore, the precious metal is still considered a "safe haven" to which investors like to flee when something is brewing somewhere.
The best investment: real assets or shares?
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Tangible assets Gold – the advantages and disadvantages Precious metals such as gold and silver belong to the so-called tangible assets, just like real estate and stocks. On the other hand, cash, but also all classic forms of savings and bonds, represent monetary values. That means you save Money in the best case, get interest on it and trust that you can still use this money to purchase goods or services in many years to come without central banks or governments robbing you of part of your reserves, for example through a currency cut.
But which assets should you invest in now? invest? What are the advantages and also the disadvantages of investing in gold? The product is not new, but you have to repeat it from time to time in order to prevent imbalances in your investments: It is essential that you invest your reserves as widely as possible and also form a kind of "iron reserve" to be able to bear unforeseeable financial burdens, without gold coins or stocks sell to have to, whose prices may then be at a low of all times. In other words, it's not about whether you are with your assets should invest in gold or stocks, but in gold and stocks. The only question is how high the respective gold or stock ratio should be in your portfolio. A gold content of 10 to 20 percent - depending on your personal security needs - seems appropriate in most cases.
Physical gold ownership and its special advantages
So what are the specific advantages of physical gold ownership (gold coins and bars) compared to the other classic tangible assets, real estate and stocks? First of all, you secure a clear tax advantage with a gold investment. You can buy gold coins and bars VAT-free within the European Union. A big advantage over silver, platinum and palladium. But be careful: Some collector coins are not from the Value-added tax free (I will come back to this in more detail later). However, if you invest in Krugerrand, Maple Leaf, Philharmonic, Panda & Co or in bars, then according to the current legal situation, no VAT is due.
Let's say the gold price rises by over 20 percent, and you want to sell your gold bars or coins two years after the purchase. In this case too, the Treasury is left empty-handed. But be careful: If you sell within the first twelve months after the purchase, you must tax the profits if they exceed 600 euros. Shares and other securities (including gold securities) are subject to the flat rate tax regardless of the holding period.
Acquisition of gold is possible anonymously
Another advantage: In times of increasingly transparent bank customers, the purchase of physical gold is perhaps one of the last ways to invest money anonymously. You can currently invest in gold in Germany up to a threshold amount of EUR 14.999,99 without having to identify yourself. If you go to the gold dealer with your spouse or partner and both on your own on account buy, this limit amount is doubled. This means that in this case you can buy gold up to almost 30.000 euros without having to identify yourself. Gold is still suitable for the discreet and anonymous form of investment.
In contrast to “concrete gold”, as real estate is often called, investing in gold does not require large sums of money. A few hundred euros are enough to get started. In addition, gold does not incur maintenance and repair costs, which is the rule with real estate. Gold is also a very mobile form of investment. At least if you are traveling within Germany. Because as soon as you go abroad travel, even apply within the EU Regulate.
No Europe without borders
Single market regardless of the common currency, whoever travels within the European Union (EU) must – if it is significant Problems want to avoid – pay attention to cash limits. This also applies to gold and other precious metals. The relevant customs regulations state: "Any person who enters Germany from an EU member state or leaves Germany for an EU member state with cash and cash-equivalent means of payment with a total value of 10.000 euros or more must declare this amount to the Report entry or exit during customs checks when asked.« This also expressly applies to gold coins or bars.
If you enter or leave a non-EU country, you must provide cash and cash-equivalent means of payment from 10.000 euros without being asked (i.e. not only when asked). This applies, for example, to trips to Switzerland or Norway. Gold is also a species Insurance. If there is a stock market crash or political unrest, the gold price usually rises because investors flee more "to safety". Due to the high demand, the price increases. This has been the case in most, but not all, cases in the past. So there is no automatism.
Shares vs. gold
One advantage of shares is their high fungibility. To put it bluntly, this means: shares can be fast make money again. Just a few clicks of the mouse are all it takes for the securities to be sold and the equivalent value to be credited to your clearing account. The fungibility of gold coins and bars is also high, although compared to stocks, it takes a little longer for the equivalent value to be credited to your account when sold. Unless you sell your gold treasures at a local dealer and have the equivalent value paid out in cash. In this case you conclude a so-called over-the-counter transaction.
As you know, when you buy shares, you need a custody account. If, on the other hand, you dare to keep your gold treasures at home and you decide not to buy a safe, there will be no more Costs at. However, you are taking an increased risk. You can find out how to minimize these in the appendix of this book.
The downside to gold, however, is that you don't get ongoing earnings. So you get neither dividends (as with shares) nor rental income (as with rented real estate). You only benefit from the price increase of the precious metal. And finally, coins and bars do not bring you any value, except that you can enjoy the yellow precious metal like goldfinger. In contrast, you can move into your property immediately and save rent.
So let's summarize the arguments for and against a gold investment:
- Property protected against inflation. Gold cannot be reproduced at will. The ECB may one day give away "helicopter money," but that doesn't work with gold.
- Regardless of strong fluctuations, gold has remained stable for centuries.
- »Safe haven« in the event of political or economic turbulence
- Discreet purchase still possible (up to 14.999,99 euros)
- Flexible and mobile
- Tax benefits (no VAT in the EU, no tax on realized sales profits after the 12-month holding period)
- Entry possible with relatively small sums
- Storage risk
- no dividends and interest, no rental income
- sometimes strong price fluctuations
- high risk of counterfeiting
- possible gold ban (as from 1933 in the USA)
- Risk of price manipulation
Gold anecdote: stewards as smugglers
The following incident from 2014 proves just how popular gold is in India. The background to this is the import restrictions for gold in India. As a consequence, this led to more and more creative forms of gold smuggling. In recent years, for example, an airline crew has secretly brought gold across the border from time to time.
Gold is said to have reached India illegally a total of 13 times. This is intended to circumvent the high import taxes. In addition to the aircraft toilet as an interim storage facility for gold couriers, golden threads in textiles and silver-plated gold, cases were known in which the precious metal was swallowed by smugglers to bring it through customs. The World Gold Council estimates that up to 250 tons of gold reach India illegally each year. This corresponds to a good third of what India officially introduced in previous years.
What factors are driving the markets?
The banker Nathan Mayer Rothschild (1777-1836) is said to have once stated with a wink that he only knew two Peoplewho are able to predict the development of the price of gold. Regrettably, these two people are becoming more and more opposite Opinions. This anecdote proves how difficult it is to forecast the performance of the yellow precious metal. There are a number of criteria, but there are also just as many exceptions. The most important price factors are as follows:
1. The development of interest rates
Anyone who invests their money in gold receives no interest. However, in times when interest rates for savings products and bonds from countries with the highest credit ratings are close to zero or even "penalty interest rates" are calculated, this argument is of little importance. That is, low interest rates usually spur gold prices.
However, rising interest rates do not necessarily have to result in falling gold prices. If interest rates rise, market participants could interpret this as a sign of a foreseeable higher inflation rate. And fear of inflation has always been a driver of the gold price in the past.
2. Development of the dollar exchange rate
Like most commodities, the price of gold is usually quoted in US dollars. So when you put a gold bar in the safe, its value depends on two factors: a. How is the gold price developing? b. How is the US dollar developing against the euro? It has already happened that the gold price is falling, but investors in the euro zone have experienced less or no losses due to the weak dollar.
A simplified example should make this connection transparent. Suppose you buy gold for $ 5.000. To simplify the calculation, we assume a parity of dollars to euros. So: 1 dollar = 1 euro. You pay 5.000 euros for your gold investment, because that is exactly 5.000 US dollars. But if the dollar had only cost 0,88 euros at the time of purchase, you would only have had to pay around 4.400 euros. Basically, weak phases of the dollar are good for the gold price - and vice versa.
3. Geopolitical escalations and global financial crises
If a war breaks out at a critical point on earth, in which the nuclear powers, particularly the United States, Russia and China, are also directly or indirectly involved, this also usually leads to rising gold prices, at least until the conflict is de-escalated.
The same applies to financial crises. Immediately before the Lehmann bankruptcy, the demand for gold bars and coins was so high that numerous traders were sold out within a short period of time. Many investors had apparently already guessed that something was "up in the air" before the official bankruptcy, and invested in gold.
4. Demand from China and India
It's a bit strange: The price of gold is still largely determined by market participants in New York and London, although the demand for physical gold in China is many times higher. Experts therefore assume that one day in the not too distant future, Shanghai will become the leading gold trading center. the in Rich The growing middle class buys high-priced gold jewellery, and in China gold is almost considered money and a second currency alongside the yuan. Even if the demand for gold in this giant country has temporarily dropped somewhat due to the economic downturn, one can assume that demand will increase in the long term. Because the middle class that can afford gold is still growing.
There is also high gold demand in India. The yellow precious metal is valued there as wedding jewelry. Gold is partially sewn into saris. The impact of Indian demand on the gold price should not be underestimated. Gold is particularly in demand from September to November, when traditionally married on the subcontinent. one
According to a study by the Australian investment bank Macquarie from 2011, around 18 tons of gold are hoarded in Indian households, which, according to calculations by the Times of India, corresponded to a market value of around 950 billion US dollars at the time. Some speculative gold investors therefore buy corresponding call warrants in good time in order to benefit from comparatively small price increases in gold via the associated leverage effect. A few years ago, the Indian government introduced Taxes for the import of gold to plug the state's budget holes. This slowed demand for gold. However, experts assume that the weakening will only be temporary.
5. Central bank purchases and sales
The central banks are still betting on gold. You will surely remember the occasionally very emotional discussions about the Deutsche Bundesbank's gold, which is largely kept in the USA.
The main central banks Welt maintain total gold reserves in the order of 32.000 tons (see table). When central banks buy or sell gold on a large scale, its price can fall or rise significantly. In 1999, the 15 leading central banks undertook to sell no more than 500 tons of gold per year in the so-called »Washington Agreement«.
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