GOLD 0.51% $1,391.7 gold futures

how to get started in gold?

  1. fss
    689 Posts.
    I would like some words of advice and tips from the wiser heads in this forum.

    Essentially the question I have is:

    How does a 25 year old get rich in Gold?

    This is what I know so far....

    1. Stocks - I've had a look at equities for a long time and the quality stocks all seem to have made their runs (eg. IAU, GRY, RMS). I understand that if POG goes to 2,3 or 4 thousand dollars then these stocks will appreciate, but by how much? Is there value in making 200% gains when there are potential 2000% gains to be had elsewhere?

    Also how will the AUD/USD affect these stocks? They all seem to be hurting as of late.

    2. CFD's - I have an account with IGMarkets and have been trading avidly for the last few years. Avidly and also stupidly. I've lost way more than I have made and even though I tend to make decent profits on trades here and there, I tend to either:

    a) sell out too quickly (I had a 2 gold contracts at $950/oz) - would be $100k up now if I had held them both. Impatience is a very bad trait of mine.

    b) don't sell out when I should and loose heavily when there is a near-term correction in the market. Or in other words, I over-invest into my CFD's. Instead of putting 2% of my capital at a trade, I may put 20% or 50%.

    I know what I need to do to get around this. Have much lower stop-losses. But this requires more equity as my margin is low(er). And if I am to adhere to the 2% rule also, then to buy a single gold contract, I would need $70,000 of equity in my trading account ($1400/0.02). I can't afford this.

    3. Physical - Have had a close eye on ebay/Perth Mint and other websites to buy physical gold but I have a few things going against me:

    a) I live in a rented apartment (like many at my age). How am I supposed to securely store bullion? And worse, I don't intend on living here in the medium term, so how does it make sense for me to keep taking my bullion where-ever I go?

    b) I can buy physical fom Perth Mint and get them to store it on my behalf (allocated or unallocated) but the advice I always receive is: "Take Delivery Now!!". So when I see hordes of people queueing outside the Mint to buy bullion, I wonder why I shouldn't be doing the same. Plus if gold does spike to some insane figure, what's to guarantee the Mint won't say "Sorry Sir, we don't have your gold anymore". I know I'll have legal recources, but there is always value in having something in your hands as compared to on a piece of paper or on the computer screen.

    Haven't really looked at ETF's. Aren't they priced in AUD? So even if the USD shits itself and the POG goes to the moon, won't the AUD also rise by a proportionate amount? So how does anyone make money then?

    Would love some advice on this front.

    Thanks in advance

 
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