Mistakes You Might be Doing in Precious Metals Investing

If you are into precious metals investing, you must be aware of the different mistakes you might be doing. Take note that the precious metals are serious investment and every investment has a level of volatility. With that said, there are some ways to understand the volatility and get rid of derailing investment strategy.

Below are the different common pitfalls that precious metals investors encounter often:

Unrealistic Expectations

A big pitfall faced by investors in precious metal investing, regardless of their experience level, is the temptation and impatience to chase the prices with the hopes to hit it big. Some new investors think that the prices of the metals can go up only and that success in investing is a given in short term. To achieve success, you have to full understand that investing in silver or gold is a long term proposition. You may only measure your success for many years and not months or weeks. If you want to get rich quickly, precious metals investing are not for you.

 

Chasing the Prices

Several individuals will spend years chasing after the big thing, frequently believing that a particular strategy is the one. If a particular strategy does not yield the results they’re looking for, the typical response by the investors is to blame the strategies and to adopt another quickly. They do not realize the problem that often lies within themselves as well as not with a particular tactic or strategy.

 

Physical Metals and ETF’s are the Same

Numerous investors particularly those who are new to precious metals, make an error of thinking that owning ETF or Exchange Traded Fund that invests in gold like GLD is the same with owning the physical gold. It’s important to understand the key differences between owning the shares of ETFs and owning physical silver or gold. For many years, physical silver and gold have been highly recognizable and desirable commodities that are bought easily, exchanged for goods, and sold on global and local markets. As a gold ETF’s owner, you own a piece of paper only, probably a promissory note that shows your shares. But, you don’t own any actual physical gold. ETF owns gold and you own just a promise from fund managers to pay back the share value you’ve purchased in ETF. ETF certificate is something that’s traded universally in the world market and it’s easily exchangeable or widely recognized for currency. You’d have a tough time trying to trade the paper certificates for services and goods the same way you would with the physical gold.

Minimal Research

Whenever you are faced with something new, it is easy to take the advice of some of your friends or just browse some websites before making the jump. In the market of precious metals superficial research isn’t enough because it’s only looking at the general information including spot prices or choosing the famous forms to purchase. There’s significant information you should learn about buying silver and gold and this needs sifting through misinformation.

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