Make Money Buying Gold

How to Make Money Buying Gold

Gold is the oldest and more enduring form of legal tender. It is universally recognized for its value and rarity. While financial markets make wild swings over short periods of time, gold prices tend to creep up and down. The patient investor can do quite well if they know what to look for.

It is important to understand what makes gold prices move. When the economy is doing well, gold prices tend to fall. When the economy is bad, gold prices rise. Investors tend to cling to the enduring value of gold when their financial future is uncertain.

Back in 1999, gold was selling for about $250 per ounce. By 2008 it topped $1,000 per ounce and didn't look back. Similar dips and spikes are recorded throughout history. Understand that gold prices don't fluctuate much on a daily basis but often make a steady march upward or downward over the course of several months and years.

The key to making money in gold is to buy low and sell high. This may sound obvious, but if it was easy then everyone would do it. If you are buying gold, do it when no one wants gold. Do not buy when everyone has gold fever.

Another way is to gather gold that nobody wants. Most gold transactions focus on high-quality gold coins. With gold coins, the condition and rarity of the coin increases the price dramatically over the value of the gold content. Meanwhile you can find lower quality gold coins, gold bullion, and gold scrap selling at prices at or below the spot value. You can often buy this gold in cheap lots or as unwanted scrap. When the price of gold is high, your less-than-perfect gold will sell just fine.

When accumulating gold, look for every opportunity to buy in bulk and cut expenses. Many gold dealers waive sales tax and shipping when you buy a certain amount. When you are selling, pedal your gold to the general public. A gold dealer will want a wholesale price from you but regular people will pay market retail. Sell your gold on Internet auction sites, at coin shows or to another investor who isn't as smart as you.Hold onto that gold if the spot price is on the rise. Gold investing is an exercise in patience. Accumulate your gold when the economy is good and gold is cheap. Wait until the economy crashes. It always does eventually. When gold prices rise, dust off your gold, sell it, and reap in the profits.