# What is the best way to get exposure to Gold. Yes, shiney glittery Gold.



## hark (Oct 5, 2014)

NOTE: This is the third time i'm trying to post this. Don't know where my previous posts went to. :upset:

I'm new to investing so please bear with me.

I have a TD Waterhouse account. I'm wondering what is the best way to buy into a position for Gold? Any ETFs or other ways to own a position on the metal?

Thanks a lot!


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## hark (Oct 5, 2014)

I did some research and it seems like buying Canadian Mint 5oz gold wafers or coin is one way to invest.

TD Bank sells if but the price is a markup from the amount of gold you're actually getting. They also offer "paper" that can be directly sold back to them for cash at market price but they charge a % fee against the value annually...

Is it a good idea to buy actual gold coin/wafer from TD and store it in my own TD safety deposit box?

Anyone know how much TD (or any other banks) would try to ding me when i sell it back in the future?


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## james4beach (Nov 15, 2012)

There's a recent thread on this, regarding physical purchases
http://canadianmoneyforum.com/showthread.php/24425-Precious-Metals-question


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## hark (Oct 5, 2014)

Thanks. Interesting exchanges with fatcat going on there..

I learnt from that thread that the purchases have to be done in USD. That doesn't sound like a smart thing to do now since my cash are all in CAD and its looking pretty weak against the greenback right now. *sadface*


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## Spudd (Oct 11, 2011)

You can also buy ETF's such as GLD (also USD) or CGL (CAD).


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## gardner (Feb 13, 2014)

CEF.A is one of the stalwarts.



> Central Fund of Canada Limited (Central Fund) is an investment holding company. The Company’s objective is to provide a secure, convenient, low-cost, exchange tradeable investment alternative for investors interested in holding an investment in gold and silver bullion for long-term appreciation.


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## HaroldCrump (Jun 10, 2009)

We are perhaps re-hashing the old discussion, but I'd not buy GLD, CGL, or even CEF.A
GLD is perhaps the worst choice among these 3, as they are notorious for leasing out their gold.

IMHO, the entire premise of buying gold is to hold the physical metal in personal possession, out of the hands of financial manipulators.
If you want to buy gold for purely price speculation & market timing, then I suppose GLD is fine.
The issue with CGL is that it is subject to not just the price of gold, but the movement of CAD vis-à-vis USD as well.


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## hark (Oct 5, 2014)

I suppose the consensus for long term (~10yrs or more) gold investor is to buy the good high quality physical stuff and stuff it into bank deposit boxes and forget about it.

I'm planning to put around 5% of my cash into gold. For any gold investors, what percent of your holdings are in physical gold?


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## james4beach (Nov 15, 2012)

My gold exposure is in CEF.A (which I've held for nearly a decade) and some physical.



> For any gold investors, what percent of your holdings are in physical gold?


As a percent of my total net assets, 4% in physical.
Combined CEF.A+physical (total precious metals exposure) is 6%


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## fatcat (Nov 11, 2009)

HaroldCrump said:


> IMHO, the entire premise of buying gold is to hold the physical metal in personal possession, out of the hands of financial manipulators.


+1 from me ... i don't even like having it in a safe deposit box since i don't control access to that

james prefers to keep his alleged gold in an alleged vault at several would be locations owned and inhabited by a bank that may or may not be solvent

do i have that right james ? :biggrin::cheerful:


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## james4beach (Nov 15, 2012)

I have twice as much in physical vs CEF. I just posted that! In fact I prefer to keep physical gold directly held.


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## lonewolf (Jun 12, 2012)

In case of government confiscation of gold might want to consider holding some gold in Switzerland, 
Gold money James Turk kinda has a neat way of holding & using gold

Ripple coin is supposedly backed by gold, I think it "might" have been created by the engineer of Bitcoin. I do not know much about Ripple. When gold bottoms I would like to buy a few dollars worth of Ripple, Not sure if I can figure out how to buy it. Anyone know how to trade Ripple coin ?


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## hark (Oct 5, 2014)

Avoid all cypto-currencies. Those are fools-gold.

@fatcat, if you don't store it in deposit boxes, where do u put it? Underneath your pillow?


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## fatcat (Nov 11, 2009)

hark said:


> Avoid all cypto-currencies. Those are fools-gold.
> 
> @fatcat, if you don't store it in deposit boxes, where do u put it? Underneath your pillow?


i follow the wisdom of the convict and i keep it all up my bum :biggrin:


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## hark (Oct 5, 2014)

james4beach said:


> I have twice as much in physical vs CEF. I just posted that! In fact I prefer to keep physical gold directly held.


James, where do you store your physical? Fatcat's *** is full of it.


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## lonewolf (Jun 12, 2012)

hark said:


> Avoid all cypto-currencies. Those are fools-gold.
> ?


 Hark, you could be right, I think of them as an insurance & only a dollar or 2 should be put into them.
about 600 fiat currencies have failed in the past & gone to zero according to Cassy research.


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## HaroldCrump (Jun 10, 2009)

Buying a crypto-currency because you want to avoid digital "fiat" currencies like the USD/CAD is silly.
The USD is also a digital currency.

Secondly, buying a crypto-currency linked to physical gold stored in a vault completely defeats the purpose.


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## hark (Oct 5, 2014)

HaroldCrump said:


> Buying a crypto-currency because you want to avoid digital "fiat" currencies like the USD/CAD is silly.
> The USD is also a digital currency.
> 
> Secondly, buying a crypto-currency linked to physical gold stored in a vault completely defeats the purpose.


USD is not strictly a digital currency although it behaves like one... They still need to mint or print something physical as a symbolic legal tender with some face value. Heard about the trillion dollar platinum coin Obama could mint to wipe out the US deficit? Such a tempting easy button to push...

Anyways, giveme USD any day over some cypto-garbage. At least i can take pleasure in the feds needing to buy some cloth fiber to print it out for me.

Cypto currency linked to physical gold stored in a vault sounds like a really smart dumb idea.


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## HaroldCrump (Jun 10, 2009)

hark said:


> USD is not strictly a digital currency although it behaves like one... They still need to mint or print something physical as a symbolic legal tender with some face value.


True, but the physical coins & bills are a tiny fraction of the overall volume of trade in USD denominated securities worldwide.
Just the treasuries is a multi-trillion dollar market globally, and it is all digital these days.

Add in the various stock exchanges in the US that trade in US$ and they are all digital (there are at least about 14 major exchanges at this time, I believe).

To me, the only difference between a "fiat" currency like the USD and a "crypto" currency like BTC is that the former is backed by seigniorage & confidence in the sovereign, while the latter is backed by some exotic computer algorithm.



> Heard about the trillion dollar platinum coin Obama could mint to wipe out the US deficit?


That was Krugman's idea.
I would like to see them try it.
In fact, why stop at the $1T of deficit.
They should simply mint the $17T or so equivalent to their nominal debt, and pay off all US liabilities to the rest of the world like China, Saudi, etc.
Just imagine...the US will be debt free !

Next, they should mint another 54 of those shiny coins to wipe out the $54T or so of unfunded liabilities such as social security, medicare, and govt. pensions.
All problems solved !


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## fatcat (Nov 11, 2009)

HaroldCrump said:


> To me, the only difference between a "fiat" currency like the USD and a "crypto" currency like BTC is that the former is backed by seigniorage & confidence in the sovereign, while the latter is backed by some exotic computer algorithm.


not quite right harold ... the latter (BTC) isn't backed by an algorithm but by confidence in the integrity of the public blockchain ... as we become more "digital" and understand such things better, i believe we will see people gain that confidence

BTC is wobbling but still standing and there are many to take its place

also, i think there is an important distinction between fiat which belongs to a country and crypto which belongs to no country and that is a also part of the prime appeal of BTC


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## swoop_ds (Mar 2, 2010)

My vote is to buy from coin dealers. 'Most' of them deal in bullion and will sell to you at reasonable rates.

I store some of mine in a safety deposit box that I already rent and some stays at home. (roughly split 50-50)


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## hark (Oct 5, 2014)

From what i read and gathered so far, you guys are recommending buying high quality physical.

If i buy only from big bank (i dont trust anyone else), what is the cost difference between getting gouged when buying/selling from/to banks and the MER of gold ETFs if i hold for 10yrs.


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## HaroldCrump (Jun 10, 2009)

hark said:


> If i buy only from big bank (i dont trust anyone else)


There are a couple of very high quality trustworthy sources.
Border Gold is one.
There are an authenticated, authorized dealer for the Royal Canadian Mint.
I have personally spoken to the Royal Canadian Mint, and they recommend Border Gold as well.

Kitco is another.



> what is the cost difference between getting gouged when buying/selling from/to banks and the MER of gold ETFs if i hold for 10yrs.


I don't think there is any gouging if you are buying directly from the Bank of Nova Scotia, Royal Bank of Canada, Border Gold, or Kitco.
There is of course a bid/ask spread regardless of who you buy from and sell back to.
In the case of Scotiabank, you can check the bid/ask spread _*on their website *_

As for gold ETFs, there is a bid/ask spread as well, but quite tight for the high volume ones like GLD (US) and CGL (Canadian).
And keep in mind that all gold ETFs have MER fees, just like regular ETFs.
Over the long run, these ETFs are not exactly as cheap as they may appear to be.


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