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The Differences Between Physical Gold and Silver and ETF Certificates

Last updated 6 years ago

While the value of gold and silver constantly fluctuates, these precious metals are limited commodities, making investing in them a great choice. If you are considering investing in gold or silver, then you may be curious about the differences between owning physical quantities of these metals and purchasing ETF certificates.

Physical Gold and Silver

Physically owning gold or silver offers a number of benefits. One of the primary advantages of having gold or silver in your possession is that it is protected from bank failures, as the metal is stored outside the banking system. In addition, the value of gold and silver bullion is internationally recognized because precious metals have an intrinsic value, unlike paper certificates. Owning physical gold or silver is also a great way to balance more volatile assets, such as stocks and bonds, in your portfolio.

ETF Certificate

An exchange-traded fund, or ETF, is an investment fund that can be traded on a specific market, much like a corporation’s stock. ETFs are available for a number of commodities, including gold and silver. Purchasing an ETF allows you to invest in the gold or silver markets without physically purchasing these metals. However, the value behind an ETF is not backed by a physical piece of gold or silver that you can redeem with the certificate. While ETFs may be a convenient way to invest in gold, the certificate itself holds no intrinsic value. If a bank or stock failure were to occur, then the value of an ETF certificate could be completely lost. In addition, these certificates can only be traded in certain markets and cannot be used as international currency.

At Capital Gold Group, we provide the opportunity for investors to purchase precious metals in the form of coins and bullion. To learn more about the advantages of investing in physical gold or silver, call Capital Gold Group’s office in the Los Angeles area today at (800) 510-9594.

The representatives at Capital Gold Group are not financial advisors and the information provided in this blog should not be considered financial advice. The past performance of gold investments is not indicative of potential future gains. 


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