Investing as a Newbie – Gold vs Silver vs Platinum; Which should I invest in?

阅读中文版本

One of the most frequently asked questions I get in the precious metals industry is – which precious metal should I be investing in? I believe this is also a question that is constantly on the minds of investors who are new to precious metals. Well, I’m sorry to have to tell you that there is no right or wrong answer to this question however, as the saying goes, better the devil you know, than the devil you don’t. This saying applies to investments as well! It is definitely better for you to invest in a product that you are familiar with, than to invest in a product that you don’t understand at all, agree?

In Asia, I believe that Gold is a commodity that everyone is more familiar with, especially in Southeast Asian countries. Gold exists in many forms and commonly appear as physical jewellery, decorations, coins, bars, etc. It is also structured as financial instruments and derivatives such as stocks, futures, and Exchange-Traded Funds (ETFs) and is traded across major financial institutions and platforms.

If you are considering to invest into precious metals now, then I would recommend for you to start off by investing into Gold. It is not that other precious metals such as Silver, Platinum, or even Palladium and Rhodium are not good however, we should always consider two key points when we invest – Liquidity and Buy/Sell Spread. Personally, I think that investing in Gold is more beneficial for investors who are new to precious metals. Afterall, no one would want to invest in a product only to find out later that it is difficult to sell or that the market price cannot keep up with the spread of buying and selling, right? Well, Gold is the solution to these two problems. Goldsmiths, pawnshops or bullion dealers such as GSC will definitely buy your Gold(unless it has been obtained through illegal means or the refinery/mint of the Gold you bought is “blacklisted” internationally)! The buy/sell spread is about 2.20% for an investment grade Gold kilobar (1 KG). Judging from the performance of Gold prices in recent years, catching up with this 2.20% is not a difficult goal to achieve.

Of course, there is no absoluteness in everything, and there is no business in this world that makes only profit. While you can still hold on to Physical Gold till prices rise again and to your favour if you had bought coins or gold, you may face paper loss or in the worst-case scenario, have your account forcibly liquidated if you had bought Gold on margin and faced a volatile market with plummeting prices.

When you get more familiar with investing in Gold, you will gradually learn more about other precious metals and diversify your precious metals portfolio (portfolio diversification) by purchasing into them. As the performance of precious metals vary from metal to metal during different time periods with different market demand, we do not recommend that you invest all your excess funds into precious metals, which aligns to our belief of reasonable investing.

I will stop here for the time being and see you next time! If you have any questions, feel free to leave a comment and we can discuss together.

Maya