Whether it be in the form of gold jewellery, bars, coins or ingots, gold has represented wealth and prosperity for hundreds of years. Lately, however, investing in gold has become exceptionally popular. If you’re interested in taking advantage of the recent gold rush, this blog will discuss why people invest in gold, when to expect investments to ramp up, how gold is measured, and why you need a trade-approved scale.
Why is Gold Investment Becoming Popular?
One reason is that the value of gold reacts inversely to the value of the pound. This means that when the value of a pound falls during times of inflation, the price of gold increases significantly, becoming a dependable financial backup for those who have already invested. It also essentially locks out those who can’t afford to invest until the price goes back down. This exclusivity keeps the price high for a longer period.
During times of deflation, when the value of a pound rises, the price of gold decreases. In this case, more people can afford to invest in gold. However, though the price of gold may decrease, it will likely not decrease as much as other items might, which means that the purchasing power of gold would ultimately increase. This gives the investor incredible protection against deflation.
Another reason people are investing in gold is to diversify their investment portfolio. For example, let’s say you’ve only invested in stocks. Suddenly, the stock market crashes, and you lose all your money. Whoops! However, if you invested in both stocks and gold, then you have gold to fall back on when the stock market crashes. Having a variety of different investments provides protection when one fails. [TS1] This practice is known as diversification.
When Does the Gold Market Typically Increase?
Gold is becoming popular because of its security. Investors don’t tend to stock up on gold when the economy is healthy. As many believe that we’re heading into a recession within the next few months, the price of gold is predicted to rise, therefore it’s best to invest now when the price is still low. Likewise, this cycle will repeat as the economy improves and declines in the future. [TS2]
There are multiple different ways to earn money with gold. One way is becoming a gold dealer. This includes stocking up by purchasing gold bars when the price is low through other local dealers or online, depending on whether you would like to inspect the gold before making the deal. Once you have enough gold stock, you can then begin reselling the gold yourself when the price is higher, making a healthy profit.
Another way is selling scrap gold or jewellery at a pawn shop or other gold buyer. To make good money doing this, you need to learn how to identify quality gold that others may have discarded or looked over. The gold buyer will then examine the jewellery and offer you a price for the trade. The better quality of the gold, the higher the price. However, you will make significantly less money selling scrap and jewellery than if you’re able to stock up on gold bars and coins.
How is the Value of Gold Measured?
Gold’s value is based on its weight and purity. The weight of gold can be measured in troy ounces, which is the most common and precise, as well as grams and carats. Gold will commonly be sold in terms of these weighing measurements as well. The purity of gold is measured in karats, with twenty-four karat gold being 100% pure. Because purity and weight both affect the price of gold, it’s important to know both to determine the true value. Gold bars will be sold by weight, but before you sell gold jewellery to a buyer, consider learning more about the gold measuring process to guarantee that they are valuing your jewelry properly.
Why Do You Need a Trade Approved Scale?
If you intend to sell gold by weight, you’ll need a trade approved scale. Trade approved scales are required by law to be used when the price of an item is determined by its weight. Trade approval is an extra certification that verifies the scale’s accuracy and gives both the seller and the buyer peace of mind. To learn about the different types of trade approval and which one applies to you, check out our blog A Quick Guide to Trade Approved Scales and Balances.
Some models of the WBW-M Water-Resistant Commercial Scales are EC type, OIML, NMI and NRCS approved for selling jewellery and gold by weight. The WBW offers optional rechargeable batteries, so you can take it wherever you need to be. For extra durability and protection, the WBW features a stainless-steel pan as well as an IP66 rating against dust and water ingress, so you can worry less about keeping it clean, and still precise.
If your gold is in the form of jewellery, balances like the WBW-M are a reliable way to weigh bulk gold chains or calculate value when purchasing scrap metal. Head to our website for more information on how Adam scales fit in the jewellery industry.
If you’re ready to buy a trade-approved scale, click here to access our quote request form. Have any questions? Contact us for more information.
