How to Invest in Gold Stocks

By Jason Gordon

  • Overview

    Gold has a special history as both the preferred currency for most of world until the modern age and as a metal used in jewelry production. Considered to still have value for both these reasons--and because of its relative scarcity--gold is seen by many as a hedge investment to protect against the scourges of inflation and periods of economic and political distress. Today, investing in gold is easier than ever.
    • Step 1

      Log-in to your online brokerage account. If you don't have an account, create one by navigating to the Website of a popular online brokerage. Examples of online brokerages include Fidelity, Charles Shwab, E-TRADE, or Scottrade. You'll find the links in our Resources section.
    • Step 2

      Select "Open Account" to start the account creation process. Enter the required information to create your new brokerage account. You will have to fund the account before attempting to purchase any stocks. The brokerage firm will instruct you on how to fund the account.

    • Step 3

      Select the gold-related stock you want to invest in. For example, you could invest in Barrick Gold (ABX), one of the largest gold mining companies in the world. Buying a producing mine like Barrick Gold is safer than buying an exploration-stage company.
    • Step 4

      Buy a junior exploration-stage gold-mining company like U.S. Gold Corp. (UXG). Smaller companies that are not yet producing are riskier, but the possible upside is much greater than a more established company.
    • Step 5

      Buy stock in the SPDR Gold Trust ETF (GLD) for the newest and most popular way to invest in gold. This ETF (Exchange-Traded Fund) works just like a stock or mutual fund without the fees. It tracks the price of gold so you can invest in gold and not worry about where to bury it or what kind of shady managers might be running that junior gold mining company.
    • Step 6

      Buy your chosen stocks buy clicking on trade on your brokerage account page. Enter the number of shares you want to purchase. Click confirm and wait to receive your confirmation. Congratulations--you will then own stock in gold!
    • Skill: Moderately Easy
    • Warning:
    • Like many commodity investments, gold can be volatile. Use common sense to avoid painful losses.
    • Never invest more than you can afford to lose.

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