After a major Brexit last month, the markets have become uncertain and the price of gold and silver has been fluctuating. We saw this the first week of July when the price of silver sky rocket, and last week when the price of gold fell as the American dollar became stronger. This has caused many investors and new silver and gold buyers to buy into the uncertainty of the markets, but what should you know before buying gold and silver? Here are 5 things to know before you buy gold and silver.
1. Why are you Buying?
Before buying into the precious metal markets. It is important to know why you are buying gold and/or silver. The main reason many invest into gold and silver is in hopes of selling it in the future for a bigger return, or as a defense against economic disasters. Many silver investors invest in the reflective metal in hopes of trading it in for physical gold, based off of the gold to silver ratio (price of gold per ounce / price of silver per ounce), or for industrial investments such as electronics or jewelry.
2. Understand The Precious Metals
The price of gold and silver is determined by its economy, usage and its rarity. Silver has more usage than gold, but gold is rarer and has a higher demand. Check out last week’s blog post, Gold vs. Silver, for more information on the precious metals.
3. Understand The Market
Since gold and silver are physical currencies, its value is mostly determined by the global markets. The market value of gold and silver is called a spot price. These prices go up and down throughout the day until the market closes at 3pm. Many silver and gold buyers watch the market price to determine when is the right time to buy. This month we saw the impact of the markets on the price of silver and gold after a major Brexit and the American dollar became stronger. For more information, check out last week’s Weekly Recap of gold prices and our post about the silver rise.
4. How to Buy Gold and Silver
They are many ways to buy gold and silver, but the main ways many gold and silver buyers use are bullion dealers and banks (Exchange Trade Funds). Many choose bullion dealers, such as our selves, because of our prices and to get their hands on the physical precious metals.
5. Know Your Dealer
It is important to know that you are working with a credible and one of the best dealers in the markets.Canadian Bullion Services is an international precious metals dealer headquartered in Toronto, that is ranked among the top precious metal dealers in Toronto. Visit our main site for more information, and keep up with us on Twitter and Facebook. Don’t forget to check out our weekly posts every Tuesday!
Are you buying gold and silver right now? Let us know in the comment section below!
Image Sources: metronews.ca, blog.ceo.ca