Investing in Gold Gems and Platinum

I admit I fell for the pitfall of investing in gold three years ago. The price was approximately $400 an ounce of gold. I bought ten ounces of gold thinking the price would go through the roof. The pitfall of holding too much gold, is that my overall cash position was too low. So I had to sell my gold slowly slowly to clear my overdraft debt.

I bought them from different e bay traders, and sold them on eBay for either the same price less PayPal fee’s, delivery charges inward and outwards. The gold i received was of nice quality in shine and pleasing to look at in terms of sentimental value and had.

The one criticism I had of holding the gold, is that they gold assets do not earn a physical return from owning them. The cost of holding gold, is the opportunity cost that is lost in holding cash at the bank and for other investments.

Gems come in different shapes, sizes and types. Gemstones, ruby, sapphires, diamonds, emeralds, crystals all are worth different values, the clarity and quality of the different stones vary greatly. The scarcity value and market value is another issue to consider. I find gems not worth investing in as they are second place to gold and platinum. The desire factor of gems is much less than the excitement and thrill of owning much more valuable assets such as gold and platinum.

Platinum which is the most expensive traded metal, is more costly than palladium and gold. Though platinum is still a silver based metal, just that being of a different composition results it being valued at almost one hundred times more than silver.

The key to investing in these areas, are the finances available to invest in gold, and what people do with the metal. There are plenty of ways of owning metals, as they can be stored and held at home, in bank vaults, used to make jewellery and for gifts. In theory these metals are used as a hedge against inflation, though these metals are far from being risk free. Demand and supply factors like any other product are key factors in determining the suitability of this form of investment.

Alternative investments in these types of class, could include buying stocks in gold and metal mining companies. Therefore research into the metals market as well as a wide range of stock market research in this sector are needed.

If starting a business in jewellery then these types of metals will ultimately bring considerable interest, or a dealer buying and selling on eBay, or through gold retailers. Though to make money in this market requires the risk of needing to invest quite heavily initially to get the customers and also by having readily available levels of stock to sell, and being able to deliver upon payment. Another form of operational and business risk is that customers will have to and be willing to pay say twenty to thirty per cent mark up on the wholesale cost price. Investing for low mark profit margins will make investing in these markets seemingly not worthwhile, so here the risk versus the reward ability of investing in metals is tested fully.