With Gold prices trading around a spot price of $1120 per ounce, up about $60 in the last month. Many naysayers have been saying that the demand for Gold cannot be sustained. Frank Holmes, CEO and CIO of US Global Investors, a long time gold bull sees no reason for the bull trend to end.

In a recent interview with Tech Ticker Frank Holmes says, “There are many compelling factors both from a supply side and then from the demand side that looks like gold will trade higher.”

Holmes, however, does have a few words of caution for those looking to get rich on gold. He recommends a 10% allocation in gold that would be divided evenly between bullion and stocks.

Holmes’ reasons to bullish on gold:

– Massive federal deficits and low interest rates in the United States and elsewhere will raise inflation risks and keep downward pressure on currencies.

– Rising incomes in Asia, where affinity for gold runs deep, will have a sizable positive impact on demand; China is now the largest producer of gold in the world but that won’t drive down prices because the government is “using it as a reserve currency for themselves.” However, bulls should note China’s chief for exchange official has said that China will limit their purchases.

– Peak Gold? Gold production from mines is not adequate to meet demand. Production is dropping around the world. Holmes notes worldwide production fell 10% in 2008 and is especially dramatic in South Africa – the world’s largest producer.

If you would like to know more about allocating a portion of your portfolio to Gold, contact one of our experience Gold experts for more information.

Out of all the beneficial gold investment options that exist, the most crucial option is the one to physically own gold, as opposed to purchasing ETF (Exchange Traded Funds), which are electronic shares of gold bullion that are purchased over the Internet. ETFs are popular gold investment options, but in the event of a major banking crisis, these shares could prove to be worthless. Physical gold holdings in rare coins like $20 Double Eagles, $10 Eagles, $5 Half-Eagles, and $2.5 Quarter-Eagles, are generally used for proven, long-term financial protection and potential growth. Bullion coins like 22-karat American Eagles, or 24-karat Austrian Philharmonics are commonly used as short-term diversifications, because their prices hover just above the current gold spot price, which represents the cost of one troy-ounce of pure gold.

In order to maximize their gold investment options, investors should always first conduct a thorough evaluation of their finances to determine their specific financial long-term and short-term needs and expectations. They should then consult a qualified gold investment specialist from a reputable, large-volume precious metals exchange to help them to properly diversify according to their individual financial requirements. These large-volume exchanges supply gold bullion and rare coin to local gold dealers throughout the U.S., so household investors can avoid paying over marked retail prices for their gold by dealing directly with these institutional suppliers. Investors are encouraged to complete their research, and then to contact one of our friendly specialists, who offer these institutional discounts on bullion and rare coin to household investors like you.

Eric Osborne

Prospective investors needn’t be overwhelmed or frightened by the number of gold investment options that are available today, as a preliminary evaluation of their finances and expectations will categorize these options quite effectively. Once investors have decided to emphasize their strategies on either short-term profits, or long-term financial security, their gold investment options will be further narrowed between purchasing bullion, or rare coin.

Since bullion items like 22-karat American Eagles carry prices that are close to the spot price, investors use them as short-term profit vehicles. Other popular bullion items are more affordable bullion bars with reputable brand names like Engelhard, or PAMP Suisse, as well as more costly 24-karat bullion coins like Chinese Pandas, or 24-karat American Buffalos. All of these items are also U.S. government approved for long-term IRA storage, and can also be used as effective diversifications for much more costly rare coins, which are widely accepted as today’s premier investment for long-term financial safety.

Today’s most widely purchased rare coins are Double Eagles, which are 22-karat, $20 Lady Liberty, and $20 Saint Gaudens gold coins. Investors are advised to only purchase Double Eagle coins whose numismatic value has been officially certified by either the Professional Coin Grading Service (PCGS), or the Numismatic Guaranty Corporation (NGC). Official mint state grades for investment-quality certified rare gold coins typically range between 61 and 66, out of a possible 70, which is a grade that is reserved for coins that are held by serious collectors, or museums. Investors are encouraged to complete their research, and then to contact one of our friendly specialists, who offer institutional discounts on bullion, and rare coin.

Eric Osborne