How To Invest in Metals: A Guide To Know All The Alternatives

The investment world never stops, despite volatility or episodes that can harm our assets. And while many dares with the stock market or bonds, others seek traditional havens such as gold or other metals. How to invest in them?

The physical purchase, in the case of precious metals

Indeed, not all metals are the same. In the case of precious metals, one of the possibilities is the physical purchase of bullion: This is valid for gold, silver, platinum, or palladium, for example. 

How can it be done? It is necessary to resort to companies specializing in making transactions with bullion, coins, or jewelry. Above all, in the investor field, it is necessary to know that the company is legally registered, with all the guarantees, and has the lowest possible commissions. 

In the case of ingots, three fundamental factors must be taken into account: The purity of the ingot, which must be 99.9% when possible; who has an international certificate in the metal; and that they issue a purchase invoice for possible claims that we may make in the future, along with the purchase certificate. 

Invest through mutual funds

There are some categories of mutual funds exclusively dedicated to investing in metals: both precious and industrial. It is a good option from an investment point of view. 

Some of them are geared towards gold assets, while other products are focused on more commodities. The normal thing is that these vehicles are focused on mining companies, producers, and a long etcetera. To do this, all you need is to have an investment account with your bank or with an online broker.

For those who are less seasoned who want to deposit their money in metals, the possibility of funds is an option to consider. Of course, it is convenient to read the product brochure well to see how it is positioned and the commissions that will apply to us as clients. 

Opt for other alternatives such as futures or ETFs

Among the most advanced products through which you can invest in metals of all kinds are futures contracts, contracts for difference (CFDs), and investments through ETFs. All of them directly invest in these raw materials.

To access these types of products, you need to have an account with an online broker. There are many possibilities in the market and you have to focus on the range of products and the commissions that apply. The nuance that experts focus on is that they are recommended options for more experienced investors.

For their part, CFDs carry a class of risks that only a professional trader or investor can handle: They have to do with the multiplication of values ​​and the leverage in which it operates, because the capital that we have used can end up disappearing.

Finally, the alternative of ETFs is a good possibility. This vehicle is an investment fund listed on the markets and generally replicates a series of assets or indices.