Investing in gold stocks is considered a speculative play on
miners that are prospecting or as a prudent play in times of inflation
or economic uncertainty. There are many different ways to invest in
gold shares. Most exchanges have gold shares listed so it is a matter
of researching the alternatives and selecting a stock you are comfortable
owning. Your style of investing will also influence the way you purchase
gold stocks. Short term players look to take advantage of gold price
momentum whilst longer term players pay particular attention to the
companies prospecting potential and the likelihood of the company
finding marketable gold reserves.
On a global scale, there are several notable countries that are renowned
for gold mining activities. Australia, South Africa and Canada are
countries that have active companies in the gold sector. With globalization
becoming increasingly important, geographic location is no longer
a limiting factor for companies that wish to expand their business.
Many companies have joint venture projects that extend to all corners
of the globe. Some of these ventures carry bright prospects but come
with associated risk if the country is politically unstable. This
recently happened to an Australian company, Emperor Mines that experienced
troops bringing operations to a halt.
You can also invest in gold ETF's. An example of this is StreetTracks
Gold (gld) ETF which is traded on the New York Stock Exchange and
is designed to track the performance of gold bullion. Similar structured
funds are also located in Australia (Gold Bullion Securities), on
the London Stock Exchange (Lyxor Gold Bullion Securities) and in
other countries such as Canada (The Central Fund of Canada) and
Switzerland (ZKB Gold ETF ). The iShares Comex Gold Trust also trades
on the NYSE and provides an opportunity for investors to gain exposure
to gold price movements.
There are many newsletters that specialize in gold stock selections.
They cover stocks that have gold mining prospects and or associated
opportunities. You can do a search on the internet for these publications.
They are a good way to learn about new discoveries or companies
that are potential candidates to invest in gold stocks.
