Right now is an interesting time to be investing in the precious metals market. as the events driving stock markets and precious metals pricing globally are as complex as ever.

A combination of politics, economics, investing strategies and industrial usage dictate the value of gold, silver, platinum and palladium. These events thus drive the prices for those investing in the precious metals market, so savvy investors have to weigh all of the events and try to figure out the combined impact on the markets.

That can be tough to do for newcomers, so it is important to find ways to invest a little bit more easily until the research can be done.

How to Invest in the Precious Metals Market

There are a few different ways to take up an investing position in a precious metal. One of the simplest, but also the most expensive is to buy bullion, or large bars made for investment purposes. On the one hand, having physical possession of an investment does make it a lot more secure. On the other, it is quite expensive to buy bullion and that is one reason it is difficult for newcomers to do. Most people are not comfortable throwing down five figures or more for their first investment into precious metals.

In addition, securing bullion can be nerve racking. You don’t just want to bury a bar of gold in the back yard, so there are arrangements that must be made. Coins are a more popular form of physically investing in precious metals for newcomers, but they do require a bit more research. When investing in gold, silver, platinum or palladium coins, it is important to be sure of the rarity and the purity of the coins and factor that in to the evaluation.

For those looking for an easier way to begin investing in the precious metals market, there are exchange-traded funds. To break the concept down in as simple of terms as possible, a fund buys precious metals, takes possession and stores them. They then sell shares in the fund, which essentially is the same as buying a share of the gold. This enables them to break the price down a lot lower, making it affordable for more people, while still matching the price movements of the metal in question. The issue that people encounter if they don’t do enough research is that some funds take all of the operating expenses out of the profits, which means that the losses can be a bit bigger and the gains a bit smaller.

Lastly, there is the option of investing in stocks of companies that derive their value from precious metals. This method of investing in the precious metals market may be the riskiest, as it requires a lot of research on the company itself. For example, when investing in a platinum mining company, one must be sure that the company has viable mining locations and a good workforce, along with the assets and liquidity to complete the project. However, if that research is done well, the potential profits are even higher.

The Four Precious Metals

When investing in the precious metals markets, there are four main choices: gold, silver, platinum and palladium. Investors more commonly buy gold and silver, and though they do have industrial uses, they are not as prominent as platinum and palladium in that regard. They are both used extensively in circuitry, for medical purposes and in vehicles for catalytic converters.

It is wise to not only diversify your portfolio overall, but also your precious metals investments in particular.