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Updated 23:44 23/05/19

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Is gold a good investment?


Gold has long been considered a smart asset to invest in. As both a hedge against inflation and a way to diversify your portfolio, the benefits of gold investment should be considered by anyone looking for a simple, safe way to protect and grow their money.

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Why invest in gold?
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Gold has been a highly valued, precious metal for most of human history. From the Egyptians, to the first Roman gold coins, right through to the current day; humans continue to have a fascination with the dense, yellow metal.

One of gold’s key strengths is its isolation from the trends of other markets. Historically, when the global economy has been in crisis, gold has remained strong (and even made significant gains). For example, the price of gold increased rapidly following the financial crash in 2008/09 and remained high even as economies began to recover. In particular, gold typically makes gains during periods of rising inflation; as investors see that their money is losing value, they look to safer assets like gold that has proven its ability to maintain its value.

Unlike money, which can be printed by banks as part of a quantitative easing program, gold is a limited resource. Increased demand from emerging markets, and gold’s use in the technology industry, mean that when coupled with the finite nature of the metal, the price of gold can remain strong.

is gold a good investment

Owning physical gold is the ultimate way to control your investment. There is no third-party risk, and you can decide where, and for how long, to store your gold before you sell, whether you take possession or choose to use secure storage.

When you do decide to sell, this can be done quickly and simply using online dealers. At BullionByPost we buy gold back at 96% of the current spot price and list live buy-back prices on our site. This transparency makes it easy for customers to make an informed decision when it comes to selling.

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Is it worth investing in gold?
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Gold as an investment relies on an increase in value to make returns, rather than the annual yield you might see from stocks and shares or a property. For gold to reach its true potential can take time, which is why gold is seen as a long-term investment. Gold has shown excellent performance since the 1970s, with a price per ounce that has steadily trended upwards.

For a savvy investor, profits can be realised in relatively short periods of time. Awareness of gold’s performance, coupled with a reasonable knowledge of current affairs, can give investors the ability to spot prime opportunities of when to buy or sell their gold.

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Investing in gold coins
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Investment gold can take various forms; jewellery, bullion, ETFs or even investing in mining companies. All are ways to put your money into gold, but in the UK one way to invest in gold is to purchase coins.

As legal tender, there are various British gold coins that enjoy tax benefits. Gold Britannia coins and Gold Sovereigns are both VAT-free when you buy, and Capital Gains Tax (CGT) exempt when you sell, saving you money and maximising the returns on your investment.

For more information on gold’s VAT benefits click here, and for CGT click here.

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Should I invest in gold?
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As with any investment, the decision on where to put your money should be made only after careful consideration of the facts. At BullionByPost we recommend that up to 10% of your liquid wealth is kept in gold. Diversifying your portfolio reduces overall risks against the volatility in any market, and by investing in gold you can protect yourself against the wider economic fluctuations and uncertainties that many other assets are weakened by.