Gold is always a sound investment, no matter the economic climate, and in times of uncertainty, it’s the go-to for most wise investors.  An ETF is an Exchange Traded Fund which works in a way similar to money market funds, but allows multiple trades during the day, rather than just one or two.  Many ETFs are based on commodities like bullion.

A gold ETF is essentially a certificate based on a specific amount of gold.  So one certificate in an ETF might represent half an ounce of gold at current value.  As gold’s value versus the US Dollar increases, so does the value (in dollars) of the certificate.  These can be traded throughout the day like most other stocks, but are exchanged as part of an ETF, so you are always guaranteed a sale or purchase – which is based on the current market value of gold, or gold’s “spot price.”

Different types of funds give different types of ETF investing in gold as well.  The SPDR Gold Trust, for instance, is a gold ETF based on gold bullion, located in the U.S., and with a relatively high expense ratio of 0.4%.  The PowerShares DB Gold Fund, on the other hand, is based on gold futures (rather than physical gold) and has an even higher expense ratio of 0.5%.

If you have small holdings, then going with one ETF and aiming for lower costs is probably most important to you.  If you have a very large amount of holdings, diversifying between custodians rather than minimizing costs may be your goal.

In either case, gold ETFs change daily and even hourly and are a good way to get into gold investing if you don’t want to hold a lot of physical gold yourself.

Gold ETF investing can be done through several types of gold commodities on the market.  Gold futures, actual gold (in certificates), or even physical gold can all be included in a gold ETF.  Usually these funds focus on one type or another, but some dabble in two or all three of them.

Some interesting mixes in this gold ETF investing include some gold ETF offerings that mix the above types, such as the Sprott Physical Gold Trust.  This offering issues gold as certificates (at 1/100th ounce per).  Anyone with at least 4,000 certs (or 400 troy ounces) can redeem those for a London Good Delivery Bar (a 400oz gold bar).  The certificates are removed from the fund and the physical gold is delivered.  This call option often drives the price of each share upwards, beyond gold’s spot price.  This can be good or bad, depending on your perspective.  If you plan to take physical delivery of the gold, you will pay a premium and would probably be better off just purchasing gold itself without going through a gold ETF.  If your purpose is speculative investing, however, funds like this have the ability to be real money makers.

Other offerings on the market offer futures as part of a gold ETF.  This type of gold ETF investing is more speculative than others and requires a real keen eye on current markets (in futures) and their trends.  While investing in gold futures is trending upwards on the whole, individual mines and consortiums may not be doing well or may be stretched to the limit with their futures already – which dogs their price.

Overall, the world of gold ETF investing has definitely gotten interesting and there are few investments that are as exciting when investing in gold today.

They provide the best gold investing option because they are certified and approved by the stock markets and have billions of dollars in assets. This also means that fluctuations in gold price boost the value of the entire fund which is later transferred to each individual investor.

If you are interested in gold ETF then you will have to keep certain things in mind. The first thing to focus your attention on is the type of ETF that you are going to invest your money in. Try to invest in funds that have higher values and market capitalization. This will enable you to earn significant profits. Any rise in the prices of gold will increase the value of the fund. If the increase is 10% then you will see a boost in 10% of your investment. You can always sell your investment whenever you want. It is as simple as that.

With gold prices today at or above $1,000 per ounce, investors are trying to figure out the most cost effective way to buy gold bullion.  Buying gold bullion is not as easy as buying shares of stock.  However, through the use of gold ETF funds, learning how to buy gold bullion has become easier.

But gold ETF funds are not the only way to buy gold bullion.  Gold bullion can be purchased in many different forms.  If a gold investor is looking to purchase physical gold to hold and store, he can purchase gold bullion bars, scrap gold, gold bullion coins, or rare gold coins with numismatic value.

How To Buy Gold Bullion Coins

Mints around the world sell gold bullion coins for investors and collectors.  Some of the most desired gold bullion coins are the American Eagle Gold Coins sold by the United States Mint.  However, some other popular gold bullion coins are Gold China Panda Coins, Royal Mint Sovereign Gold Coins and South African Krugerrand Gold Coins.

There are four main drawbacks to buying and selling gold bullion coins.  The first is the acquisition cost.  Gold dealers will not sell you gold coins at the gold spot price.  Instead, the Mint charges a premium to cover its overhead and profit and the dealer that you purchase from charges a premium to cover its overhead and profit.  If you are buying online or through the mail, there will also be transportation fees. In addition to the acquisition costs, buying gold bullion coins includes a storage cost, insurance cost and sale transaction fee often in the form of a sale price below the current gold spot price when you go to sell the gold coins.

A best practice for how to buy gold bullion coins is to find a local gold bullion coin dealer to buy from.  If you buy regularly or in bulk, you can often get lower prices from a local gold bullion coin dealer.  This is especially true if you tell the dealer that you want to buy XX ounces ahead of time.  The coin dealer can acquire the gold bullion coins and sell them to you right away knowing he has a client. I think that this is the best way to buy gold bullion coins.  But, it is not the most cost efficient way.

How To Buy Gold Bullion Through Gold ETF Funds

Buying gold bullion using gold ETF funds is the most cost efficient way to purchase gold bullion.  The purchase commission and sale commission on gold ETF funds transactions is often much lower than the premium you pay when buying gold coins.  If you would like to read more about investing in gold using gold ETF funds, I encourage you to read my primer on Gold ETF Funds.  While you are at it, you might want to also read our popular article on understanding gold market prices.

I believe that buying gold ETF funds is the most cost efficient way to invest in the gold market.  However, many investors want to own physical gold.  The reason being that ETF funds are still more subject to government regulations.  But at the end of the day you can’t actually turn in your shares in the gold ETF fund for the physical gold in the vault.

Therefore, if you want to buy physical gold bullion, I recommend buying gold bars and gold coins.  If you have any additional questions for how to buy gold bullion, please ask them in the comments below.

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What are ETF Funds?

The first step to learning how to invest in gold ETF funds is understand what are ETF funds.  Before investing in any type of investment vehicle, it is important that you understand what you are investing in.  ETF Funds are exchange-traded mutual funds.

Ok, so EFT funds are exchange-traded mutual funds, but what does exchange-traded mean?  Let’s break this down into smaller pieces.  Exchange-traded means that these investment units are traded on the major stock exchanges, like the American Stock Exchange, NASDAQ and New York Stock Exchange.  However, ETF Funds are primarily traded on the American Stock Exchange.

The funds part of ETF Funds means that these are investing vehicles that hold many companies.  When you invest in ETFs you are not buying a single company, but instead a bunch of companies.

What are gold ETF funds?

Unlike mutual funds, gold ETF funds allow you to invest in gold itself.  Gold ETF Funds buy gold  and in exchange for such gold deposits the gold ETF funds issue shares in baskets.  The purpose of gold etf funds is for its shares to mirror the price performance of gold bullion.  Therefore, if the price of gold bullion goes up 10%, the gold etf funds share price would also go up 10%.  These gold ETF funds allow investors to invest in the gold market buy buying securities as opposed to purchasing phyical gold bullion.

Why gold ETF Funds are an efficient way to buy gold?

Buying gold bullion presents many costs that make it difficult for the average investor to purchase gold bullion.  If you buy gold bullion yourself, you will have to deal with the logistics of buying gold bullion, the storage of gold bullion, insuring your gold bullion, and the cost to eventually sell it.  These high costs in buying gold bullion often prevent people for investing in gold.  However, gold etf funds solve this barrier of entry problem for buying gold bullion.

The logistics of buying and selling gold bullion is take care of for you by the gold ETF funds.  All that gold etf investors need to buy are ETF shares.  Investors in Gold ETF funds do not have to worry about storing the gold or insuring the gold.  The gold ETF funds purchase the physical gold, take care of the storage and buy insurance policies covering the gold.

What are the benefits of gold ETF funds?

Gold ETF Funds offer a lot of benefits to people who want to invest in gold.  These benefits include,

Easy to purchase gold ETF shares – Gold ETF funds make it really easy to invest in the gold market.  Through your brokerage account you can buy and sell your ETF shares any time of the day.  Compare this to buying gold bullion where you have to find a gold dealer, drive to the gold dealer, and then purchase a fixed amount of gold bullion.  But let’s say that you only have $1000 to invest in gold.  At today’s gold prices you might not be able buy one gold ounce.  Therefore you couldn’t buy it.  But buying ETF shares allows you to buy fractional amounts of gold bullion.

Gold ETF funds are cost efficient – Another benefit of gold etf funds is that they are a cost efficient way to buy gold.  While you have to pay fees to the gold ETF fund, these costs will be lower than the costs associated with buying phyisical gold yourself.  The costs to purchase, store, insure and sell should all be lower making gold ETF funds very efficient for investing in gold.

What are some Gold ETF Funds?

There are many gold ETF funds, but some of the most popular are the SPDR Gold Trust (GLD), Market Vectors Gold Miners ETF (GDX), and ProShares Ultra Gold (UGL).

SPDR Gold Trust (GLD) – The SPDR Gold Trust ETF was the first gold ETF fund.  Each share of the SPDR Gold Trust costs one-tenth the price of one ounce of gold.  The SPDR Gold Trust ETF purchases gold bullion by buying London Good Delivery Bars which come in 400 ounces of gold bullion.

Market Vectors Gold Miners ETF (GDX) – The Market Vectors Gold Miners ETF is designed to follow the Amex Gold Miners Index which is comprised of 32 gold mining companies.  This gold ETF fund allows you to invest in gold mining companies through index investing.

ProShares Ultra Gold (UGL) – If you are looking for a more volatile way to invest in gold, the ProShares Ultra Gold ETF is designed to move twice as much as the price of gold moves.  Therefore is the price of gold increases 5%, the ProShares Ultra Gold ETF price should go up 10%.

I hope that this primer on Gold ETF Funds has been helpful.  If you have any questions about this article or Gold ETF Funds in general, please ask your questions in the comments below.

Since 2002, gold has been experiencing a bull market, but over the last six month the price of gold has gained momentmum.  In August and September of 2008, the financial crises has lead tons of investors to invest in the gold market.

Gold is a great hedge against political instability and financial instability.  With people scared to invest in banks and the stock market crashing the price of gold has increased over 40% from $700 an ounce of gold to gold price today of $1000.

Gold investing is becoming a hot area of investment for Wall Street and Main Street.  As you drive around your town, I am sure you have noticed all of the new signs around saying, “We Buy Gold”.  There is a reason why these stores are popping up all over the place.  Investing in gold is hot.

But there are a lot of way to buy gold.  You can buy gold bullion coins from the United States Mint.  You can buy rare gold coins like St. Gaudens gold coins.  Additionally, there are a lot of gold ETFs, gold mutual funds and gold companies that you invest in.

Some common gold ETFs are the GLD etf and the GDX etf.  The GLD etf is the SPDR Gold Shares ETF and the GDX ETF is the Market Vectors Gold Miners ETF.  If you would like to invest in gold mining companies some to consider are Barrick Gold, Goldcrop, and Kinross Gold.  All of these companies are traded on the New York Stock Exchange.

Please subscribe to the Gold Prices Today RSS feed to stay up to date on current gold prices and the gold market trends.  With gold prices today hitting $1000 gold will be hotter than ever.

As the stock market continues to plummet and the world economic outlook remains uncertain, investing in gold can be an attractive investment.   Owning gold bullion tends to protect investors from political instability and the price of currency on the foreign exchange markets.

Gold prices have not been this high since the last gold bull market ended in 1980.  On January 21, 1980, the price of gold hit $825.50 which in today’s inflation adjusted dollars is equal to $2,168.50.  With gold currently in the $1,000 range, it is not unfathomable that gold price could rise to over $2,000.

While no one knows where the price of gold will be in the next year, reading Gold Prices Today will give you an advantage over other gold investors.  We promise to keep you up to date on the gold price news so that you always know the gold prices today and the trends to help you predict the future price of gold.

In addition to bringing you today’s gold prices, the latest gold price news and gold market trend information, Gold Prices Today will explore the different ways to invest in gold.  We will explore how to buy gold coins, how to buy numismatic gold coins, how to invest in gold etfs, and other ways to invest in gold.

So, please subscribe to the Gold Prices Today RSS feed.  It is absolutely free.  Also, leave a comment on Gold Prices Today and share your views on where the price of gold will be tomorrow.