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Everything you Need to Know about Precious Metals

There has been consistent growth for all the most popular metals this year, with the demand for gold and other precious metals spiralling. Due to a significant trend emerging over the past few months, many people are now considering the idea of investing in valuable metals. Precious metals certainly have their place in an intelligent investor’s portfolio, but which precious metal is best to invest in and why are they so volatile?

There are many good reasons why you should invest in precious metals. Read on to learn more about the different types of precious metals, what affects their value and whether they are a good investment.

What are the different types of metals?

There are several kinds of precious metals that investors can invest in. The main ones are gold, silver, platinum and palladium.

What affects the prices of precious metals?

A number of factors have an effect on the price of precious metals. Let’s look at these factors below:

How to trade or invest in precious metals

You can trade precious metals by speculating on prices rising or falling with financial derivatives like CFDs. You will be trading on these prices, so you will not actually own the underlying assets. You can also invest in commodity stocks and exchange-traded funds (ETFs). ETFs are a convenient and liquid means of buying gold, silver or platinum, but you do not have access to the physical commodity.

Are precious metals a good investment?

Precious metals are regarded by many investors as a good investment, particularly gold, which is known as a safe-haven asset. Investors will often invest in gold during times of market uncertainty. Because of their applications in jewellery, electrical components, car parts and industry, precious metals are usually in high demand.

The risks of precious metals

Every investment has its own risks. Although they may seem secure, there is always some risk that comes with investing in precious metals. Prices for metals can fall if there are more sellers than buyers. However, during times of economic uncertainty, sellers benefit as prices tend to jump up.

Precious metals offer a useful and effective method of diversifying your investment portfolio. The rule to achieving success with precious metals is to know your goals and risk before investing.



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