Gold bullion (whether bars or coins) should primarily be viewed as a portfolio hedge and insurance against various economic and financial uncertainties first, before being regarded as a profit-generating investment. Finding a highly professional gold firm - one that doesn't have its own agenda - can greatly help you to determine the gold products that are best for your portfolio. By associating yourself with the right gold firm, you're much more likely to find your gold ownership a very rewarding experience. If, however, you choose the wrong firm and utilize the wrong investment products, it could reduce your attempt to diversify your portfolio into a disaster. Unbiased and objective advice from your gold advisor cannot be overstated as being critical to your successful endeavors in the gold market, in addition to ongoing market information and continuing education on the subject.

When choosing a company with which to do business, it's best to consider only firms that have been in operation for a number of years. Five years is good; ten or more is even better. As gold continues its current bull market (as of this writing), new enterprises will tend to spring up like weeds, especially on the Internet. Some of these are no more than home-based operations with little or no real experience in the gold market, but with sophisticated websites that make them appear every bit as competent as the firms that have been around for decades. A number of these online entities may indeed turn out to be solid, reliable gold sources; most, however, will fall well short. Firms with at least ten years of experience have been around through good and bad times; they are by far the best organizations with which to establish a relationship.

Check the credentials of any gold firm that you're considering. Are they members of any professional organizations? Contact the firm and request written information about their company. An introductory package can go a long way toward determining what the firm has to offer and whether or not its basic philosophy is in harmony with your own. It's critical that you exercise due diligence and do your homework when evaluating a firm, including any history with the Better Business Bureau (BBB). Firms that operate online should adhere to the strict codes of conduct that are associated with the BBB Online Reliability Program. If the organization is not a member, this in itself should serve as a warning. If a company has had complaints, it might be worthwhile to check further with the Bureau on how those complaints were handled. The sheer existence of a complaint isn't proof that the firm is questionable; how the complaints were handled is a more reliable gauge. Additionally, most of the top gold dealers also belong to the Industry Council for Tangible Assets (ICTA). Although this organization does not rate gold firms or in any way regulate them, it can inform you how long the firm has been a member, thereby confirming (or raising questions about) their claims of longevity.

You'll certainly want to check and compare pricing; but remember, cheaper is not always better. In fact, below-market pricing should be considered a major red flag. Here is a good place to call to mind the old adage: 'if a deal sounds too good to be true, it probably is.' When comparing prices, take heed that you're comparing like items; in other words, apples to apples. Ask for quotes as a 'percentage over the gold price.' With market prices fluctuating by the minute, effective price comparisons cannot be done in any other manner.

A firm that's been conducting business for a considerable length of time can guide you around some of the obstacles that are inherent in the gold market. It can also answer your concerns quickly, thoroughly and accurately. For many investors, what to buy is the prime question. A good gold broker can put you on the right path after briefly querying you. Look for and expect the broker to ask you questions such as: "Why are you buying gold?" "What circumstances or things are you currently considering that have prompted you to look into gold?" The broker who doesn't ask questions such as these is probably either inexperienced or simply pushing what the firm wants him to sell. This type of customer-oriented company generally competes primarily on price with little regard for the overall needs of the client. A client-oriented company, on the other hand, takes an actual interest in your gold investment and is far more preferable. An interest in you and your specific situation as an investor is a strong indicator that you may have found a firm worth dealing with.

Although often overlooked, it's also extremely important for most investors to find a firm with which they have a philosophical similarity. A shared viewpoint on economic and political circumstances could be a clue that a firm can meet your needs both now and in the future as conditions and situations change. Furthermore, choosing the right firm is essential to properly managing the long-term nature of your gold holdings. As time passes, many things that could affect your investment's value are likely to change, not only in this country but also around the world. You'll need to stay informed. The better gold firms typically offer information services such as newsletters in addition to information-based websites. Brokers at these firms usually also make themselves available for further consultation even after you've made your purchase.

Finally, it shouldn't be overlooked that, in any field, referrals are very important. If a firm has been recommended to you by a trusted friend or family member that has positive experience with it, be sure to place that company at or near the very top of your list. Such experience is always invaluable.

The gold firm that you choose should be an important resource for you as the years go by. You'll want to build a relationship with a firm that you know will be around for additional purchases and future sales. In short, you'd be wise to put some reasonable time and effort into choosing a gold firm. Your future as a gold investor depends heavily upon your selecting the right one.

blog comments powered by Disqus
Scottrade