A brief outline of gold Exchange Traded Funds (ETF) :
Of course investing in precious metals like gold is a worthwhile investment, although sometimes the handling and expertise involved with gold investments can take some time. With a gold ETF you can take away the legwork that is involved with holding physical gold while reaping the benefits of gold’s solid market value.
First off lets start with an Exchange Traded Fund ETF. An ETF is a publically traded stock with the American Stock Exchange (AMEX) being the main trading stage for gold specific ETFs. With an ETF you invest a multiple companies instead of just one. Same idea goes for gold ETFs, as the fund will buy a quantity of gold maintaining it in storage and then issues it in shares.
As the price of gold climbs so then does your investment. Your investment is tracked by an index, much like an index fund but trades exactly like any stock on the exchange market. The value of a share can fluctuate all throughout the day; as gold steadily increases or remains calm you don’t get the same financial rollarcoaster as most stocks give because you are backed by physical gold. With the stock market you get the capability of gold trading onlinewith ease from your living room from an online brokerage account.Also, a great feature is that you do not have to spend as much at once because you can by an ounce or portions of it.
Another way to dabble in the stock market with gold is with mining stocks. Between mid 2008 and late 2010 a few mining companies followed gold as closely as they should and came out on top. SPDR Gold Trust and iShares Gold Trust went up over 28 percent while Powershares DB Gold Fund went over 27%. Gold mine stocks seem to be magnified by gold good and bad. However if you want a more direct option of playing with gold’s value in the stock market a more stable choice is a gold Exchange Traded Fund (ETF).
Remember as with any brokerage account you will be subject to fees and even commissions so read the fine print carefully; many times the fees associated with a Gold Exchange Traded Fund (ETF) are less than it would cost you to insure and secure physical gold investments yourself though.