On this page we're going to review the pros and cons, positives and negatives of GoldCo.
The first company we're going to review is GoldCo. They come highly recommended by many investors. We're going to summarize the main pros and cons of gold investing with them. But first, let's review what gold is.
Gold, like all precious metals, is a physical commodity. Like the metal copper, it is malleable, ductile, ducted, ductile. It is a metal. Like silver, it is a metalloid.
What are the main benefits of investing in Gold?
One of the disadvantages of gold investing is the material's scarcity. It is generally a more volatile investment than silver or copper. As with many investments, you'll be better off using your money in more predictable investments.
How is the Gold Price determined?
Inventories and withdrawals for ETFs that buy gold are not announced, but according to our estimates, one of the ETFs buys 1.2 million ounces daily and sells only about 120,000 ounces. In other words, a daily purchase of just over 1.2 million ounces equals about 2,400 ounces per week. If the ETF bought 2,400 ounces per week, the price of gold would be $1,937.10 per ounce on the day we write this article.
How much gold is $1,937.10?
Gold is valued at $1,096.00 to $1,097.00 per ounce because it varies daily by the amount of gold bought and sold. Gold's value to the investor is $1,097.00 per ounce for this reason and to compensate for the risk of investing in gold. Gold's current value is $1,9317.60 as of September 30, 2011.
What is the current price of gold?
Gold is $1,9317.60 per ounce today because gold purchases in March, 2010 (6 months ago) dropped to $800.00 and then rose to $1,026.00 in August, 2010. Gold was $1,026.00 in January, 2011. Therefore, the price of gold is $1,0317.60 per ounce.
Gold has held $1,03170.00 in price. Gold is now $1,9317.60 per ounce and remains at $1,9317.60 per ounce indefinitely. A silver ETF is still valued at $41.00 per ounce.
The reason gold is not more valuable, is because of regulation and the Federal Reserve Bank's policy to devalue the dollar by printing more money. The price of gold is constantly changing because it is purchased by the futures market and futures are bought and sold daily. If the ETF bought the gold, the price would be as high as $1,930.00 per ounce today. If the ETF sold, the price would be as low as $1,4300.00 per ounce.
The reason the ETF is holding $1,4300.00 per ounce in price is because gold does not have a primary ETF. The ETF is actually holding the gold as a back-up.
Because the ETF has to buy and sell gold futures daily, and the value of the gold futures is only an estimated value, because of the uncertainty of the price of gold, the price of gold would be $1,9317.60 per ounce if the ETF was not held. As you can see the price of gold is constantly changing because of futures trading and futures buying and selling.
Gold is a highly speculative investment. You may profit if the market price of gold is to drop to $1,431 per ounce, if the market prices is $1,432 per ounce, or even $1,433 per ounce. But there is a substantial risk of loss. Gold is a long term investment, it is not a short term investment. The long term value of gold is $1,431 per ounce, the short term value is $1,432 per ounce. Your long term gain is only $42,640, but your short term loss is $83,920.
The current ETF price is $1,431.00 per ounce because of the futures market and futures traders. The price will not drop to $1,432 per ounce until 2014.
The price of gold is always in flux because of futures and futures traders, because of the Federal Reserve policy, and futures markets. The futures market is to avoid the regulation. The ETF is not covered by the futures law and regulations, and is allowed to be a primary beneficiary. The Federal Reserve's policy of increasing the dollar cost averaging of their QE, have resulted in the futures price of gold to be higher than the official price because of the futures market. If you take the risk, the price of gold will go down. The only way to profit is to take the long term view and use the gold ETF as a long term investment.
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