Is buying gold bullion a sound investment?

not talking about spending major money maybe 1k, i have seen gold bars for sale on ebay

Historically gold is one of the worst investments. Diamonds are the worst investment.

-- Chase Global Data & Research

Now I know gold has made a huge run. It has been 20 years in recovery. I would not be chasing it.

I would not be buying gold on ebay!

"I know a market top (in Gold) when people are selling it on ebay as "an investment." OMG.

You don't know if it is real or not.

Buy gold from legit dealers via a broker if you want, but not on ebay please!

Gold is VERY HARD TO SELL when taken in physical form. You will NEVER get full market price of gold when you sell. The person or dealer whom you are selling to will cut the value based on their profit need.

Stock symbol for Gold ETF: GLD

You missed the boat. People are buying gold at the moment because traditionally its value has been very stable, thus the amount they buy will still be worth the same amount after the recession in the US and can be converted into a strong stable currency at that time. They are not buying as an investment. To have made any money buying gold you would have needed to buy in October when prices were much much lower. Considering the recent rocket in prices, you`d be buying "high" with the chance of being left there.

It is a question of timing, just like share buying/selling. When is the high point reached, for you to sell; will you know? Assuming that the price continues to rise; you have to know when to sell, or you could find that the price drops below your buying price, and continues to fall. Gold reached more than $800/ounce in the 1980"s, then fell to around $200 in the following years. Only in recent years has it reached record highs.

Buying gold bullion is the very definition of a sound investment -- a hedge against a devaluing currency. What others here have indicated is that you might have a greater upside on riskier investments, which actually ought to go without saying. So they've really answered the question "is gold a good investment?" which is a very different question.

The important thing to weigh is whether the risk of depreciation in gold price is real. Obviously there's short-term volatility as, just today, gold went down slightly. Similarly, commodities have a history of being volatile compared to equities so that needs to be considered.

However, the grand picture most seem to be missing in their advice is that the dollar fluctuates in value so, for example, a premium bond investment that "guarantees" a positive return may only be positive in dollar-denominated terms. It may ultimately be negative if you measured the return in gold bars, euros, or yen. Once you're talking about hedging against dollar fluctuation, which is what you're doing when you buy gold, you can't speak of every other investment vehicle without considering the potential downside in their denominated currency.

As for there being no large returns on gold, consider that someone who invested in gold 12 months ago has made more than a 50% return, and that in a market that was already being thrown out as overbought as it ran above $650 per ounce!

Needless to say, gains that have already been made in gold are history. If you buy now they are already in your cost basis so you get nothing from that. However, it's fair to say that current prices are not unwarranted and there are strong arguments for further dollar decline and a further flight to gold as the dollar continues to prove a poor safe haven. Of course other currencies will be used in lieu of the dollar as well, but some of that demand will flow to gold.

Thus, buying gold is a sound investment, but like any investment there is risk and your return will vary. Unlike many paper investments that have a counterparty guarantee, however, when you buy metal you are buying a thing, like a used car, so the one you get and the way you buy it matters. Authenticity, documentation, and price all matter, not just the latter. You are not buying an agreement to furnish value (such as a bond or even a dollar bill), you're buying an individual thing that itself is of value.

If you're buying a small amount, take a look at gold trusts that trade like stocks. They store gold equal to the shares issued and trade in less-than-ounce quantities. This is different from gold certificates which do not necessarily store gold.

It's sound but maybe you are a bit late? Buy from a reputable dealer , posssibly not Ebay. What about Krugerrand or other coins? Have a look at my article on buying gold http://www.shareworld.co.uk/articles/gold.htm (ignore the prices ; needs updating, although it shows how timely my article was!))

yes, and so is silver. check out SLV on yahoo finance.

on bbc news today they did a whole segment on it, is considered a wise investment at the moment, In Birmingham we have the jewlery quater which is a great place to by gold bullions, would deffinatly go to a bullion dealer rather than ebay tho as prices are rising daily & would be much safer, you'll also get full provinence & valuation for resale purposes.

well gold prices are rising

Too expensive at the moment, I think you may have missed the boat! Buying now would cut your profit margin, but it is a sellers market!

not now, better buying premium bonds atleast you can only win or very least get your cash back.

have u seen the italian job lol

you'll never get massive returns... but it's relatively safe. It'll always stabilise.

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