Gold has edged higher in each of the past nine years, and it is set to close off its decade-long bull market. A: Alternative investment in a relatively volatile market and a proxy to gold is what defines the investment in this asset class. The movers and shakers for silver prices in the second half of 2020 will be a combination of potent forces of heavy industrial use, investment demand and its strategic importance as a currency hedge during times of uncertainty.
The investor considering coin or bar acquisition should be aware of the associated costs and challenges Associated costs include the premium paid over the price of the metal contained in the piece, shipping costs, vault storage and insurance fees (if storing at a secure vault location), opportunity cost, and the cost of liquidating the position when desired. Coin or bar premiums can be significant as a percentage of the amount invested, meaningfully reducing buying power when investing in gold and silver. This is particularly true in silver, where the premiums relative to the price of the underlying metal often exceed 15%.
But gold miners aren’t so comfortable; if gold stays low-priced for long, they can go bankrupt before the price of gold rises again. It certainly is possible for gold to drop below all-in sustaining costs (AISC) for years if for some reason demand falls, because annual production only equals about 2% of the current gold supply.
Palladium stocks are another popular way to get involved in trading the market. This means buying stocks in palladium related companies through your broker. They are typically very closely connected to the demand and price for palladium, though you also have to be careful to understand the key metrics of the individual company performance too. If you are looking for an even higher volume market, you may choose to trade palladium options or futures contracts. These can be higher risk, but are certainly the most liquid in terms of your ability to quickly trade palladium.
While coins are made at the Mint’s traditional coining facility in central Perth, a wide range of 99.99% pure gold bullion bars and 99.9% pure silver bullion bars are fabricated at our refinery in the outer metropolitan area. One of the largest facilities of its kind in the world, it refines most of the total annual production of gold in Australia – one of the world’s top-four producers.