If you’ve been following gold prices over the last month, you know that prices have been rising. A lot of theories are circulating about why this is happening, including:
- Prices are rising because the Fed raised interest rates. Gold prices almost always rise after that happens.
- The dollar seems to be weakening, and investors move to gold whenever that happens.
- China and Russia are about to invest less money in American dollars and more in gold. Some theorists say that they will do that to express opposition to President Trump’s threats to increase taxes on foreign-made goods imported into the U.S.
- President Trump’s threats to pull out of international trade agreements are already causing the dollar to weaken, and gold to become more attractive as an investment.
We don’t know if those theories are true. But we know that there are several proven, reliable strategies for profiting from gold, even when it is selling for high prices.
One is to buy gold bullion and coins and wait for them to increase in value before you sell them. One potential problem with this strategy is that gold prices could fall. Granted, that seems unlikely in the current climate, but there are no guarantees. Another issue with bullion and coin investments is that you must buy them at current trading prices – in other words, at full market price. You must then hope that gold prices will rise further, because that is the only way you can profit.
A Contrarian Way to Invest in Gold
We would like to ask you to consider investing money in gold-bearing items that must be refined before you can reclaim their value. Why is that strategy potentially more profitable than buying bullion bars or coins? Simply because there is an element of speculation involved. If you buy a batch of old computer motherboards for $500, for example, there is a chance that they could contain $1,000 worth of gold. The same could be true if you invest in a number of other gold-bearing items that include:
- Scrap from dental labs that made gold bridges, crowns and other dental appliances.
- Plating tanks from factories that manufactured gold-filled eyeglass frames and jewelry.
- Small electronic devices like remote controls and cellphones.
- Floor and bench sweepings and other scrap from jewelry stores and repair facilities.
Investing in gold scrap could be riskier than investing in bullion and coins, but there are reasons to consider it a wise investment anyway. One is that, as noted above, there are better chances of getting a bigger return on every dollar you invest.
Another reason is that there are ways to minimize the risk. For example, you can call Specialty Metals Smelters and Refiners at 800-426-2344, talk with one of our recycling consultants, and send your scrap to us for testing. If you do that, you will know how much gold your items contain, and how much money you stand to make for recycling them. You stand to make a bigger return for every dollar you invest. You may also want to learn about a Specialty Metals Gold Pool Account, which will allow you the most flexibility in taking advantage of fluctuations in the price of gold.
So, are gold trading prices likely to continue to rise? Yes, they are. But that doesn’t mean that the market is topped out and there are no opportunities to make money investing in gold. We invite you to learn more about recycling gold by calling us at 800-426-2344.
What Will Happen to Gold Prices if The U.S. Pulls out of TPP and NAFTA?
Gold, Your Steady Friend through Ups and Downs
Selling Your Gold: What’s the Difference Between an Appraiser and an Assayer?
Why Your Recyclable Gold Will Always Be in Demand