Furthermore, premiums and fees are not one size fits all. Different sellers may offer the same items at different prices so investors should take the necessary time to find the best deal.

Gold futures market

A futures contract is an agreement to buy or sell gold on a date in the future for a price that is determined when the contract is initiated. The futures market is often referred to as an arena for paper trading. Generally, the bulk of the activity is just that as metal is not actually exchanged and settlements are made in cash.

However, the futures market can also be an arena for purchasing physical gold. That is not to suggest that it is the best source of metal for all investors. Obtaining gold through the futures market requires a large investment and involves a list of additional costs. The process can be complicated, cumbersome and lengthy, which is why this option is considered best for highly experienced market participants.

Gold ETFs and other alternatives

Investors should clearly understand that investing in gold exposure is not the same as purchasing physical metal. The popularity of ETFs underscores how easily people can begin with one objective and end up heavily invested in products of a different nature.

Gold ETFs provide exposure to metal prices by offering investors the opportunity to purchase shares that represent a quantity of gold. Neither that nor the fact that an ETF is physically backed brings an individual any closer to gold ownership. A gold ETF is not a vehicle to acquire gold.

There are, however, some programs designed to allow investors to build gold portfolios without requiring that they take possession of the metal or arrange for its storage and protection. Before investing in such a program, investors should become very familiar with the terms.