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Top 10 Gold Investment Risks To Know
Thank you for taking the time to read the Certified Gold Exchange’s “Top 10 Gold Investment Risks”.
We try to cover the most common risks associated with gold investing. We are sure there are others we have not considered in this document. Proper due diligence is always recommended before making any precious metals investment.
As always, you will find no small print or jargon from the Certified Gold Exchange, so enjoy.
The Certified Gold Exchange is a 100 percent client directed gold dealer. That means we don’t tell you what, when, where, why or how to buy or sell any item(s). You alone direct our actions. The Certified Gold Exchange, Inc and its team do not give investment advice. We sell precious metals products only. We only give advice in regards to the tangible products we offer for sale or buy-back.
We also don’t tell you how much you should invest in metals. This is something you alone must decide. Because the results (or lack of results) of your actions are something you alone will have to live with.
You should beware of gold companies that use pressure. Another red flag is if they talk in definitive terms about potential profit. Talking about high profit potential is a sure sign of low integrity in a gold dealer.
The Biggest Gold Investment Risk Is Choosing The Wrong Supplier
The gold and silver investment market is not regulated for the most part. This means anyone can hang a sign outside their door claiming to be a gold dealer. Investors are also placing a lot of money in metals which creates a competitive and brutal marketplace at times.
In fact, 1,000’s of buyers overpay by 20-60 percent for their gold and silver investments. Many companies even have a business model that’s structured to take as much money out of your pocket.
What can you do to avoid overpaying for your gold and silver? First avoid investing with a Southern California company. Many Los Angeles companies have double the price of discounters. They also use celebrity endorsements, free gold promotions to influence you.
How can a simple household investor protect themself? Don’t invest one penny without first reading “10 Gold IRA Scams Dealers Use On You”.
If you follow the guidance in this report, you will bulletproof yourself from many traps.
Second, never sign on the dotted line (for IRA deals) or agree to a buy before calling us to verify your pricing. Please read about our Plus Match Plus Guarantee which is available on our menu above.
Gold Investment Can Be Volatile
Precious metals can be volatile. In fact, gold’s (the most conservative metal) largest quarterly loss since 1920 is 28 percent. Even during gold’s long-term bull markets, it has unleashed volatile price fluctuations.
You could have bought into the gold market before one of these downturns. If that were the case, you could have ended up holding a long time before prices recovered. Please look at long-term charts to check the price swings yourself before investing.
Physical Gold Investments Don’t Provide Dividends or Income
Precious metals pay no dividend and produce zero income. You can only gain money by buying at one price and then selling for more at some point in the future. So, anyone needing to earn income from their capital should avoid investing in gold and silver.
Forecasts and projections are opinions and never facts.
Gold And Silver’s Past Performance is not Proof of Future Gains
Precious metals markets’ past performance is not proof of future market performance. Just because something happened in the past does not mean it will happen again in the future.
Guaranteed Buyback of Precious Metals
If a company guarantees to buy back your precious metals, hang up the phone. It’s illegal and unrealistic to guarantee.
For example, let’s say Company A sells $500 million annually in gold for 10 years. And the price goes up 200 percent and everyone wants to sell. Does this company have $15 billion dollars on hand? Of course not! Guaranteeing to buy metals back makes it less than honest. That is good attribute for a precious metals supplier.
What we can say, however, is that we have bought back clients’ metal every time in the past.
We encourage you to call us when selling. We will check the six major exchanges to bring you our best buy price.
Most gold dealers make a two-way market for their products. Realistic ones will never guarantee it.
How Long You Should Expect to Hold Your Metals
When buying physical gold and silver, you should expect to hold for at least 3-5 years. You could buy precious metals in a downturn cycle.
The cost to buy physical metals is higher than paper and digital assets. If the gold and silver price drops after you buy you may need to hold longer to reach break even or make a profit. Holding long-term is not a guarantee that the coins or bars will deliver a profit.
Precious Metals IRAs Carry Risk Too
The Certified Gold Exchange, Inc works with many clients that want help setting up a gold or silver IRA. We can assist you in doing the paperwork to ensure a seamless transaction.
We will deliver your precious metals to the depository. We can also keep you updated on the account’s current value and help with liquidation.
CGE is not responsible for the depository or custodians for their actions
All the IRA custodians we work with are self-directed. That means they offer no investment advice. You alone will direct your buying and selling. We will be here to offer advice on buying or selling precious metals only.
What if a precious metals IRA dealer wants you to sign a designated representative form? This is a power of attorney, and a reputable gold dealer would never ask you to sign one.
You should only agree to make the dealer an interested party. This lets them check on your order but not to buy and sell without your permission.
If you have signed one in the past, you should call the Certified Gold Exchange at once. This is also true if you’re not sure if you signed one or not.
The biggest risk to precious metals IRA investors is from choosing the wrong dealer. Be sure to read our special report 10 gold IRA scams dealers use on you.
Capital Gains on your Precious Metals
If you put a penny in a gum-ball machine and a dime comes rolling out, you have capital gains of .09 cents.
This is how precious metals work also. If you take out more money than you put in, you have capital gains. So be sure to notify your accountant anytime you sell precious metals. Gold and silver are classified as collectables for tax reasons.
If you don’t pay your capital gains taxes, you risk IRS fines or maybe even a criminal complaint.
Collectables offer a higher capital gains tax rate than other investments.
If a precious metals company implies you don’t need to pay capital gains, hang up. You are speaking to an unethical dealer which should be avoided.
If you say something to a metals dealer that implies you’re planning to evade taxes, they must report you by law. Please read out AML policy to understand more.
“Always pay Caesar first”! Besides those four words, CGE will not offer any tax advice. This is very general information about taxes. You should always contact a qualified tax professional.
We Do Not Offer Investment Advice
Gold sellers are not required to have a special license. CGE staff and precious metals specialists are not licensed investment advisers.
The sale of precious metals does not require brokers to have a license like with the sale of stocks or bonds.
We know of no gold or silver dealers that have licensed investment professionals. We do not offer investment advice. This is not a normal policy within the metals industry. Many dealers will offer investment advice to the general public. They act like Certified Financial Planners.
This is not the case as they are simply selling physical retail items.
You should take such advice with a grain of salt. Even better is to imagine you’re talking to your barber or massage therapist. They are not a full service licensed investment professional.
Counterfeit Products Are An Issue
The Certified Gold Exchange, Inc has never had a single claim of counterfeit products. This is not the industry norm. Counterfeit metals are a growing problem and a serious danger to investors.
It’s always better to invest in PCGS and NGC certified gold and silver coins.
Many corner mom and pop shops have bought and sold counterfeit products at one time or another. This has been well documented.
Even big banks like JP Morgan have fallen victim. They have discovered $50,000,000 in fake gold bars in their vaults. These bars had the mark of all four of the major refineries in Switzerland.
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CGE recommends contacting us directly and that you select items that were manufactured coins from US and Canadian mints. Their coinage has anti-counterfeit technology built in.
Always buy with a major national dealer that can guarantee purity and has sophisticated equipment and processes in place to guarantee your investment.
Bonus Tip On Gold Investment Risk
We are a large volume discounter with a minimum investment of $50,000. That is a considerable amount of money, and it requires you to have a contract in place.
Any company that allows such a large transaction without a contract may not be planning to be around in the future or have not taken the time to protect themselves. You should never enter into a sizable investment without clear terms being set.
You should also read the contract completely before investing in gold and silver. Most Los Angeles dealers even state in their contract that they charge over thirty percent buy and sell spreads.
Please download your free copy of 10 Gold Investment Scams Dealers Use On You before you invest your hard earned money.
Avoid These 10 Gold IRA Scams.
DEALERS USE ON YOU