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Are you curious about adding gold to your long-term retirement fund? Purchasing this metal for your portfolio without the right information can be risky. Many beginner traders often wonder, “What is investment-grade gold, and how can it benefit me in the future?”
At Oxford Gold Group, we help customers like you explore all their options. Our precious metals experts created a comprehensive guide outlining the fundamentals of investment-grade gold and how to purchase it. Consider the following information, then contact the team to start planning your gold IRA.
What Is Investment-Grade Gold?
Gold is a physical resource primarily mined in countries like China, South Africa, and Australia. According to reputable geologists, over 57,000 metric tons of this metal still exist underground across the world. Many investors pay top-dollar to add this limited resource to their portfolios.
Investment-grade gold contains the highest purity of any gold product you can find on the market. You can expect these items to yield 99.5% pure gold or higher. Refiners craft these metals into gold bars or gold coins for market commodification.
You can purchase investment-grade gold in several weights. Popular weights include:
- Single-Ounce Bars
- Ten-Ounce Bars
- Single-Kilo Bars
- 400-Ounce Bars
Different mints around the world stamp and sell investment-grade gold. However, most products are relatively uniform in terms of content and appearance.
Are Bullions Considered Investment-Grade?
Gold bullion is a precious metal valued by weight. These commodities come in the form of coins or bars. Some dealers sell bullion individually, while others sell them in rolls or groupings, depending on the item.
Gold bars that contain at least 99.5% gold qualify as bullion. Moreover, gold coins that contain at least 90% gold also qualify as bullion.
Unlike many rare coins, gold bullion does not always fetch a great price on collectors’ markets. Many gold bullions are in heavy circulation, encouraging investors to determine value based on the spot price of gold, rather than rarity.
While some collector coins may contain 99.99% pure gold, some investors may not consider them bullion, investment-grade gold. Check the circulation and market volume before you commit to a purchase.
Different Types of Gold Grades
When browsing precious metals in a store or online, you will likely see the term “karat” applied to gold.
Karat is a measurement of gold’s fineness. To be more specific, a karat accounts for approximately 4.1667% of the entire product in gold.
Assume you have a 16-karat gold coin. In that case, you can correctly assume that the coin contains 16 parts gold and eight parts copper, nickel, or other alloying metals.
So, which grade of gold is worth your money? Take a look at some of the most popular options for experienced investors.
24-Karat Gold
24-karat investment-grade gold is the cream of the crop. These products contain the highest purity on the gold market and are valuable to the beginner investor. Still, these products can be expensive through conventional dealers, like pawn shops and gold traders.
Oxford Gold Group sells 24-karat (99.99%) Gold Buffalo Coins in protective packaging to reduce scratching during transportation or storage.
22-Karat Gold
22-karat gold is one of the highest-purity golds found in most jewelry products. It typically contains over 91% pure gold and other metal alloys like zinc and silver. Products that contain 22-karat gold sometimes include:
- Wedding rings
- Class rings
- Pendants
- Earrings
- Coins
- Electronic parts
Unfortunately, 22-karat gold is not ideal for setting precious stones or other decorative accessories. You could accidentally scratch or crack the surface with harder objects.
At Oxford Gold Group, we offer 22-karat, one-ounce American Gold Eagle coins. The United States guarantees each coin’s gold purity and weight. As one of the most reliable and commonly traded bullion coins in the world, many individuals consider investing in it.
18-Karat Gold
Products that contain 18 karats or less are still valuable and may make excellent investments for some. However, these products contain 75% pure gold or less — often reinforced by copper and silver alloys.
Remember that gold must contain a minimum purity percentage to qualify as an investment grade. Many investors prefer higher-grade options to maximize their long-term gains.
Criteria for Investment-Grade Gold
You may wonder, “Is there an easy way to identify investment-grade gold on the bullion market?”
In general, you should keep two criteria in mind during your search: purity and the dealer from whom you buy.
Purity
Universal purity standards dictate that your gold must contain at least 95.5% pure gold — despite its weight — to qualify as investment grade. All products you shop for online will list measurements, weight, and gold purity before you check out.
If your dealer does not offer exact purity percentages, you can explore different karat options. You can always ask a precious metals expert if you aren’t sure about purity. These professionals will explain how refiners create their gold bars and why some are more pure than others.
Dealer
Always partner with a reputable dealer when shopping for investment-grade gold. Scam dealers may not list the contents of their products and may only sell collectible items. As previously mentioned, collectible coins do not always qualify as investment-grade bullion.
Advantages of Investing in Investment-Grade Gold
Here are some advantages you may enjoy by purchasing and holding investment-grade gold.
Stability
Gold is a historically inflation-resistant commodity that tends to avoid price fluctuations during sudden market crashes. Many investors use these products to hedge against the rising expenses of goods and services during economic disasters. Additionally, every recognized country in the world accepts gold as a valid form of commodification.
Diversification Opportunities
Investing in gold is a simple way to diversify your portfolio with reliable products. These precious metals — including silver and platinum — perform differently on the market than conventional stocks and bonds. Consequently, you could expect gold to diversify your retirement savings with a quality IRA plan.
Long-Term Growth Potential
Supplies of certain goods, like jewelry and electronics, cause gold prices to rise significantly over time. In the first half of 2023, the price of gold rose by over 20% due to global economic conditions and consumer demand. Those who have held their gold for years may expect the price to continue rising with a few dips.
How To Invest in Investment-Grade Gold
Below, you can learn more about how to purchase investment-grade gold.
Research Legitimate Dealers
Search the web for gold dealers that can provide investment-grade products at reasonable prices. Your dealer should have:
- Five-star ratings
- Excellent communication
- Numerous shipping options
- IRA options
It’s best to partner with a dealer that offers a multitude of gold investments, including bullion coins and bars from different international mints. Oxford Gold Group makes it easy to shop online for dozens of investment-grade products.
Know Your Budget
The spot price of gold can be a bit pricey for some. Know how much you are willing to spend before you get too deep into the shopping experience. If you can’t afford the price of gold right away, silver investments may be a suitable alternative while you save up for more expensive precious metals.
Silver is traditionally less expensive upfront and may also hedge against economic downturns. Still, investment-grade gold tends to provide better overall benefits for one’s portfolio. Even owning a couple of gold bullions could do your retirement savings wonders.
Plan for Storage
You must store your gold bars in a secure location after purchase. When storing 24-karat gold jewelry, safety deposit boxes, and banks are the ideal solution. These climate-controlled environments will ensure that your items do not sustain damage while they increase in value over time.
Some experienced investors discourage storing gold products at home unless they have a vault or fire-proof locked container. Your gold could be vulnerable to theft, deterioration, or other surprise mishaps without the proper protection.
Be careful when purchasing some investment-grade, IRS-approved gold products. IRS rules state that investors cannot store some gold products (usually bullion) at home. In this case, you can trust a custodian to handle your investment-grade IRS gold at any approved depository.
Certain fees will apply for third-party storage. However, this method typically provides the best security for your investment. You can schedule an appointment to check on your gold at any time.
Purchase Your Gold
Once you have everything in order, you can commit to your purchase. Simply add items to your cart and checkout online. Depending on your storage needs, you can select whether you want to arrange a physical home delivery or send the shipment to a depository of your choice.
Don’t let confusing percentages, measurements, and denominations stop you from finding the right gold product for your retirement portfolio. At Oxford Gold Group, we provide all the information you need to navigate the process confidently. Our representatives can guide you through our inventory of high-value bullion and help you sign up for a precious metals IRA.
Explore our reviews to see why so many customers like you trust us for our transparency and ethical trade practices. Feel free to contact us with questions or concerns about the trading process.
Are you ready to purchase investment-grade gold from a dealer you can trust? Contact Oxford Gold Group in Beverly Hills, CA, at 855-940-6206.
FAQs
Is Jewelry a Better Investment Than Gold Bullion?
Most investors choose gold bullion over jewelry to boost their portfolios. Bullion typically has higher purity and lower retail markups than jewelry — giving investors the opportunity to make money back when it comes time to sell. Always ask your financial advisor which commodities are worth investing in for the best results.
Which Form of Gold Is Best for Investment?
Gold bars are an excellent investment if you can afford the storage and transportation fees; 99.9% pure gold will fare better on the market than anything of lower grade. Keep an eye on the spot price of gold to determine which type is right for your portfolio.
What Is the Difference Between Bullion and Investment-Grade Coins?
The primary difference between regular bullion coins and investment-grade coins is purity and rarity. Regular coins typically have a lower gold content than investment-grade coins. Additionally, investment-grade gold is scarce, making it a hot commodity for both amateur and veteran investors.
