Costly Mistakes to Avoid
You may be new to investing in precious metals, or are an established veteran in this field of self financial growth. However, the odds are that you may or have already fallen into traps resulting from the lack of insider trade knowledge.
Knowing the pitfalls to avoid while purchasing investment grade precious metal is almost as crucial as taking the first step in your own financial well being.
There is never a case when knowing what to avoid can amount to anything bad. On the flip side, not knowing may bring about catastrophic harm to your wealth.
What will be shared with you are the experiences gathered and observations made from interaction with precious metal investors, retailers and suppliers.
Price Isn’t Everything
With a so many gold and silver bullion retailers out there offering the same products at different prices, it is only human to go for the ones costing the least. However, that is a grave mistake you’ve made if you did not have considered to the underlying reasons that account for such differences.
It is easy to assume that higher priced products from retailers may be due to the their inability to achieve the required volume for discounted inventorization or perhaps to sheer greed resulting in a higher commission charged.
In that light, you may have already reduced your retailer’s role of your precious metal investment process as one of a mere middleman. In reality, you couldn’t been further from the truth.
To provide lower priced products, rogue retailers may resort to selling secondary market (pre-owned, circulated, secondhand) investment precious metal which may have defects, instead of freshly minted ones to you as they may have lead you to believe.
Although secondary market products from renowned and respectable suppliers may still be acceptable despite the defects, there is a higher risk of the very same rogue retailers resorting to purchasing your precious metal products from highly questionable sources.
Another primary way of providing lower priced products is to omit certain key checks and processes from their service to you so that operation cost can be reduced.
Coming easily to mind is to eliminate the high cost process of authenticity checks on your gold and silver products which in today’s context is a definite essential step due to the abundance of well made fakes on the market.
Being the most expensive part of their services to you, they will lead you to believe that checks may not be necessary or have already been done. However, should you try to question further the very same retailers offering cheap priced products, they will not be able to support their claim on the authenticity of the gold and silver products.
In essence, your cost of investing in precious may be lower by choosing lower priced retailers, but wouldn’t risking perhaps the entirety of your precious metal holdings to save a few dollars sounds like an awfully bad choice to you?
Invest in precious metal, but never forget to invest in its authenticity and quality too.
Credential of Dealers
As an industry picks up media coverage and momentum, you can be assured that more retailers or service provides to spring out of nowhere claiming to answer to your particular needs and more at a cheaper rate and cost.
That in itself is an illusion as you know, despite your justifications to yourself for using the newer and cheaper company, that expertise and experience are what separates success from failure.
This concept is especially true when you deal with high priced precious metal dealers as you have definitely more to lose should quality and/or authenticity of your products fail industry standards. That is, provided you’ve even receive your paid products in the first place, which you may not.
How else better to rate the competency and reliability of a precious metal retailer than by the credentials awarded or achieved? With insufficient background knowledge regarding the ins and outs of the precious metal business, it is prudent to leave such tedium to the experts and professionals to judge.
The awarding organisations always comprise of many professional with different expertise in areas of a company’s inner working. Couple with key factors identified to be directly responsible for competency and reliability, they made up the qualifying criterias for the award.
Awarding organisations, in order to maintain their respective awards’ trustworthiness and exclusivity, limit the number of awards with stringent checks and competitive comparative judging.
Whether the credentials are awarded or achieved, they require the meeting of key criterias including financial stability, legal compliance and operational standards Thus they provide an accurate guideline to the stability and reliability of the respective company.
Companies without such credentials have a higher probability of not adhering to proper financial management, legal compliance and operation standards.
As a direct result of financial nonadherence, the payment that you have made for your yet unreceived precious metal products may be put to risk due to financial mismanagement of the precious metal company you’ve purchased from.
Without legal compliance, the sources of your gold and silver bullion products may be obtain via highly dubious sources which their authenticity may be in question.
Operation standards, though not as critical as the previous two aspects mentioned, but generally contributes to long waiting period between payment and the receiving of goods putting your investment to greater risk.
Instead of guessing which investment precious metal retailer is more reliable and competent, let the experts and professionals choose it for you simply by looking out for your dealer’s credentials.
Authenticity of Products
When you purchase investment precious metal, you expect to receive just that, authentic investment precious metal. You probably would have thought that Singapore, being ranked 8th safest country in the world by Mercer’s Quality of Living and Safety 2011 Survey, will never have any cases of fakes circulating the market.
The unfortunate truth is, fake gold and silver bars have already hit the globe. In United States where the veteran precious metal retailer reside, multiple cases of forge gold or silver bars and coins have been uncovered.
Allegedly, all of which have been traced back to China, the go-to places for knock-offs of every kind. From plated to layered fakes, they are of high quality that untrained and inexperienced dealers will not be able to differentiate.
Before anyone conveniently summarizes that fakes can and only come from China, be informed that United States isn’t any better.
In October 2009, China discovered that a shipment of serialized gold bars from United State’s Fort Knox, a storage facility for their gold, were in fact of tungsten core. The discovery came after specialized tests have been done as a routine procedure.
That is not to say that Singapore precious metal retailer are selling fakes, but more of posing the question that will they be able to spot the forge gold and silver bullions if they are sold.
With technology making leaps and bound, methods of testing for authenticity have been greatly improved in both accuracy and speed. The question lies in whether the retailer of your choice have been employing such technology in ensuring your peace of mind when purchasing from them.
Chances are when you do make a purchase from your low priced gold and silver retailer, such testing are not being conducted, due to the additional cost involved. Should they make such claims about having such authenticity testing programs, don’t take the word of any retailer for it and asked for it to be demonstrated to you instead.
Don’t save a dime today and risk a dollar tomorrow. Buy only tested precious metal product and protect your investment, even if it cost marginally more.