The Many Reasons Why Canadians Should Consider Investing in Gold

Investing in gold can be an excellent move for investors looking to secure or increase their wealth, especially during tumultuous economic times, including the COVID-19 pandemic.

That’s because gold is known to be a safe haven asset, meaning an asset that tends to retain or even increase in value during a financially volatile period in history.

Consider the numbers. Gold was valued at USD 1,700 during the earlier days of the COVID-19 pandemic. Gold then went on to surpass a record high of USD 2,000.

Not coincidentally, in August 2020—one of the most tumultuous months of the COVID-19 pandemic in North America—Forbes published an article titled “Why Gold Is The Best Investment In The World Today.” Three benefits of gold, according to that article, are:

• Gold has maintained its purchasing power with remarkable consistency throughout the last 5,000 years
• Gold is backed by its merit, not by central banks or governments
• Gold, unlike paper currencies, is a global money

Expert investors put their money into gold assets during precarious times because these assets may increase in value and act as a hedge against rising inflation. In fact, gold tends to appreciate during periods of inflation.

• Gold can diversify an investor’s portfolio
• Gold can shield an investor’s portfolio from the ups and downs of volatile markets
• Compared to many other asset classes, gold has a better portfolio weight

Generally speaking, there are three ways to invest in gold for Canadians looking to buy and possibly eventually sell gold in Toronto or elsewhere in the country. Canadians can invest in gold by putting their money in:

1. Gold proxies that represent silver value (for example, gold exchange-traded funds [ETF]s)
2. Gold options and futures in the commodities market
3. Gold bullion (bars, coins, and ingots that are officially recognized for being at least 99.5% pure and are kept at reserves by governments as well as central banks)

The benefits of investing in gold bullion may give Canadians a leg up on competing investors in other countries. That’s because, here in Canada:  

• Gold bullion is not subject to sales tax
• Gold bullion is considered an investment vehicle
• Gold bullion can be included in one’s RRSP
• Gold bullion coins are used as legal tender

Gold bullion, a hard asset, is priced per ounce, and beginning investors often buy 1 oz bullion online or in-person from bullion dealers.

Recently, 1 oz of gold bullion has been hovering just under USD 1,800 per oz. But that number may increase during more economically unstable times.

So, if you’re an investor, keep your eye on the price of gold per ounce. Also, consider talking to a financial adviser about your options. Investing in gold bullion can be an excellent financial decision, but you want to make sure that, when you invest, you know what you’re doing. Some bullion companies even offer free bullion consultations to help with new investors in the industry.

Credit Michael Longmire via Unsplash

Investing in gold can be an excellent move for investors looking to secure or increase their wealth, especially during tumultuous economic times, including the COVID-19 pandemic.

That’s because gold is known to be a safe haven asset, meaning an asset that tends to retain or even increase in value during a financially volatile period in history.

Consider the numbers. Gold was valued at USD 1,700 during the earlier days of the COVID-19 pandemic. Gold then went on to surpass a record high of USD 2,000.

Not coincidentally, in August 2020—one of the most tumultuous months of the COVID-19 pandemic in North America—Forbes published an article titled “Why Gold Is The Best Investment In The World Today.” Three benefits of gold, according to that article, are:

• Gold has maintained its purchasing power with remarkable consistency throughout the last 5,000 years
• Gold is backed by its merit, not by central banks or governments
• Gold, unlike paper currencies, is a global money

Expert investors put their money into gold assets during precarious times because these assets may increase in value and act as a hedge against rising inflation. In fact, gold tends to appreciate during periods of inflation.

• Gold can diversify an investor’s portfolio
• Gold can shield an investor’s portfolio from the ups and downs of volatile markets
• Compared to many other asset classes, gold has a better portfolio weight

Generally speaking, there are three ways to invest in gold for Canadians looking to buy and possibly eventually sell gold in Toronto or elsewhere in the country. Canadians can invest in gold by putting their money in:

1. Gold proxies that represent silver value (for example, gold exchange-traded funds [ETF]s)
2. Gold options and futures in the commodities market
3. Gold bullion (bars, coins, and ingots that are officially recognized for being at least 99.5% pure and are kept at reserves by governments as well as central banks)

The benefits of investing in gold bullion may give Canadians a leg up on competing investors in other countries. That’s because, here in Canada:  

• Gold bullion is not subject to sales tax
• Gold bullion is considered an investment vehicle
• Gold bullion can be included in one’s RRSP
• Gold bullion coins are used as legal tender

Gold bullion, a hard asset, is priced per ounce, and beginning investors often buy 1 oz bullion online or in-person from bullion dealers.

Recently, 1 oz of gold bullion has been hovering just under USD 1,800 per oz. But that number may increase during more economically unstable times.

So, if you’re an investor, keep your eye on the price of gold per ounce. Also, consider talking to a financial adviser about your options. Investing in gold bullion can be an excellent financial decision, but you want to make sure that, when you invest, you know what you’re doing. Some bullion companies even offer free bullion consultations to help with new investors in the industry.