How to make money from bullion trading?
Traders diversify their portfolio into different asset classes. And diversifying into bullion is one of the easiest to deal and is an almost liquid asset class.
The success rate depends solely upon the degree to which planning and making strategy are done. It happens just as in any other sector or industries.
- What is bullion?
Bullions trading are the word used for trading in gold, silver, platinum, and palladium. They are measured in terms of their weight.
Gold and silver are mostly cast in the form of bars. Each bar contains information regarding purity in percentage terms, serial no. weight, and embossing of the manufacturer.
On certain occasions, gold and silver are sold in the form of coins. They are also sold in the form of grains for general purpose trading.
- Working of a bullion market
To make a profit from any trade or from any security, the basic fundamental is to buy low and sell high.
Bullion market also works on the same principle. And the commodity market is no exception, and precious metals are supposed to be the best option.
If one scans the movement of the stock market and commodity market, one can see that they move in opposite directions.
That is when commodity markets are high; stock markets tend to be at its low, and vice versa. One can say that they both move more or less in the opposite direction of each other.
Say, when one suffers losses in the stock market, he can cover his losses by opting to invest in the commodity market and vice versa. This way one can control his losses.
- Why use bullion coin
Gold and silver are usually called precious metals. Gold and or silver cast in inform of the coin are called bullion coin. Their value is based on the purity and weight of the coin.
Many countries like Canada, US, British, South Africa mint their national coins using gold and or silver, which are used as legal tenders in their country. They have value in other countries also and get favours in their tax policies.
- Investing in the different commodity in the marketplace
Most of the people or traders, physically obtain bullion in physical form. It is a sense of security. Many analysts feel that investing in the commodity market is one of the good ideas. But at the same time, they believe in diversifying commodity holding in different precious metals.
One can take bullion trading tips from professionals who after analysis of the market will let you know how much you can expect returns on your investments and in which metals.
That is, some percentage for gold, some for silver, and some for other metals like copper, lead, nickel, zinc.
- Where and how can you buy bullion
Bullion like any other commodity is traded in the marketplace. In India, one can obtain precious metals in for of coin from banks or jeweller store. Though one can also obtain them in the form of a bar. Which are more discounted because they do not have added cost for making changes?
The government of India from time to time releases gold and silver for traders in the field of precious metals or also in the form of gold bonds for the general public.
While buying bullion you should also take into account various taxes that are involved. It differs from country to country. Certain countries offer advantages while buying bullion metals.
- Where and how can you sell your bullion
Bullion can be sold at most of the jeweller shops spread across the country. In India, one has to show proof of purchase, while selling bullion.
The required proof can be a cash memo (bill), or certificate when purchased from the bank. This is basically to stop the selling of illegal gold that is procured by theft or other illegal means.
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