The current price of gold is just over $2,000 an ounce, but that price is in U.S. dollars. Investors can use many other currencies to make gold purchases and some could offer savings.
Financial experts say using a foreign currency to buy gold will save or lose money, depending on the relative strength of that currency in relation to the dollar.
Lately, the dollar's share in global central banks' foreign currency reserves has dipped and other countries are making greater use of their own currencies. In some cases, using those currencies to invest in gold could be a good move.
Here are some ways you can buy gold using currencies other than the U.S. dollar:
Foreign Currency Accounts: You can access these accounts through some U.S. banks
Forex Trading Platforms: These trading platforms can be used toturn U.S. dollars into the desired foreign currency to make the purchase.
Online Gold Trading Platforms: Traders may have the option to trade gold in various currencies.
Gold ETFs
But the simplest way may be to invest in gold exchange-traded funds (ETF) listed on a preferred foreign stock exchange. For example, an investor in the U.S. who converts their dollars to British pounds would be able to buy shares on the London Stock Exchange using the British currency, which may or may not be stronger than the U.S. dollar.
A gold ETF is essentially a stock in a fund that has a store of physical gold. As the price of the previous metal goes up and down, so does the price of the ETF.
To buy shares in a British gold ETF, investors would first have to convert their dollars to pounds. If the foreign currency is only slightly stronger than the dollar it might not make sense, since exchange rates, transaction fees, and tax implications could offset any gain.
Buying gold in a foreign currency usually makes sense only where the foreign currency is much stronger than the dollar. That’s why investors should get advice from an experienced and trusted pro before making any investments.
A good place to start with research is with ConsumerAffairs’ guide to gold dealers. ConsumerAffairs reviewed 25 companies, analyzed 3,000 verified reviews, and picked the five best.
Photo Credit: Consumer Affairs News Department Images
Posted: 2023-12-27 12:02:38
