Gold prices remain elevated. Should you invest in 1-ounce gold bars now?
Gold investing has been top of mind for many investors over the last few years. After all, when inflation and other economic issues are looming, investors tend to turn to safe-haven assets like gold to protect their wealth and mitigate losses from more volatile assets. But the unique benefits that gold offers in uncertain economic climates haven't been the only draw recently.
Gold prices have soared since the start of 2024. The first milestone occurred in March when prices touched $2,160 per troy ounce — up by about 8% compared to the previous high. The price of gold then climbed to nearly $2,260 per ounce on April 1 before notching yet another record in late May. And earlier this week, gold reached a new pinnacle when the price climbed to over $2,472 per ounce.
Prices have ebbed since then, but gold remains elevated today. In turn, you may be thinking about investing to capitalize on any future price growth. But given the recent price run, is gold — and 1-ounce gold bars, in particular — still a prudent investment option? Here's what to know.
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Gold prices remain elevated. Should you invest in 1-ounce gold bars now?
There are a few compelling reasons to add 1-ounce gold bars to your investment strategy right now:
Accessible entry point
While gold's price is high overall, 1-ounce gold bars are a viable entry point for many investors. These compact units offer a more manageable way to add precious metals to your portfolio, bridging the gap between prohibitively expensive larger bullion and less substantial smaller denominations. And their standardized size allows for incremental portfolio diversification, enabling you to gradually build your gold holdings in line with your financial capacity and risk tolerance.
Learn more about the many benefits that gold investing can offer you today.
Future appreciation potential
Gold is typically considered a longer-term investment. However, there is still room for short-term growth, as the recent price trajectory indicates. All it takes is the right economic environment for that to happen. And many experts think there's still room for more price growth. So while there are no guarantees, if you buy into 1-ounce bars now, you may be able to capitalize on any future appreciation.
Inflation protection benefits
Inflation is cooling, but it hasn't hit the Federal Reserve's 2% target rate yet. And like all gold investments, 1-ounce bars can serve as a hedge against inflation. That means buying in now, while inflation remains high, could deliver big benefits. After all, the value of 1-ounce gold bars (and other gold investments) tends to rise alongside increases in the cost of living, helping to preserve your purchasing power.
High liquidity
Gold is considered a liquid asset, but certain types of gold investments, like 1-ounce gold bars, are more liquid than others and are easily tradable. That's because the standard size and weight of these gold bars make them easy to sell when needed. With 1-ounce bars, you also have the flexibility to sell a portion of your gold holdings without liquidating your entire investment. This can be advantageous for managing cash flow or rebalancing your portfolio.
Easy portability and storage
Proper storage and insurance for physical gold can incur ongoing costs, even when you purchase gold in smaller denominations. However, the compact size of 1-ounce bars makes it easier to store your gold securely at home or in a safe deposit box. They're also more portable than larger bars if you need to transport them.
Reduced counterfeit concerns
The gold market isn't immune to scams, and counterfeit gold bars can be an issue. While you should still ensure you're purchasing from reputable dealers to avoid potential counterfeits, the standard size and weight of 1-ounce bars can make them easier to authenticate compared to larger bars. That, in turn, can potentially reduce the risk of buying counterfeit gold bars.
The bottom line
As gold prices continue to sit near historic highs, 1-ounce gold bars present an intriguing option for investors. These bars offer a combination of accessibility, liquidity and potential for appreciation, which can make them an attractive choice for those looking to diversify their portfolios or hedge against economic uncertainties.
As with any investment decision, though, it's crucial to align your choice with your financial goals and risk tolerance. After all, the recent gold price trajectory may offer the potential for further gains, but it also increases the importance of careful timing and consideration for your investment.
