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How to buy gold stocks

Stocks in companies that mine gold can be a solid addition to any portfolio.  Getty Images

Investing in gold is a solid option for many investors for a range of reasons. Because gold's value tends to follow the overall economy, it acts as a good hedge against inflation. Gold has also had historically stable value over the long haul, meaning that it's less likely to completely crater, which is always a risk with other investments like stocks and bonds. Plus, adding gold investments is an easy way to diversify your portfolio and it allows for easy liquidity.

One common way of investing in gold is to actually own the precious metal, either directly or through an investment vehicle like a gold IRA or gold ETF. And, another way into the gold market is to buy stocks in companies that are involved in the gold industry. This lets you get in on the action of the gold market without actually owning physical gold. In fact, gold stocks have the potential to offer higher returns than physical gold — though it has the same risks that come with investing in the stock market.

Get started on your gold investment journey here.

How to buy gold stocks

There are three basic ways you can invest in gold stocks:

Buy them yourself

Before the days of the internet, you would have had to visit a stockbroker to buy shares of gold stocks. Now, you can simply open an online brokerage account and purchase shares right from your phone or computer. 

If you don't have a brokerage account, do some research to find the one that works best for you. Check out the features and pay special attention to the fees charged for each transaction. Some platforms give a number of trades for free, so it may benefit you to look for that if you plan on making a lot of trades.

Learn more about buying gold online today.

Use a financial advisor

If you need help with investing in gold stocks, a professional financial advisor could be a good idea. An advisor will help you figure out which gold stocks you want to invest in and how much money to put in each. Some advisors are also broker-dealers and will be able to buy the stocks for you.

Keep in mind that hiring an advisor is a bigger commitment than just buying gold stocks. They will help you build an overall financial plan, so know that you're hiring someone who will be helping you with more than just one transaction.

Buy gold ETFs

An exchange-traded fund (ETF) is a mutual fund that trades on the stock market. You buy shares of the fund, your money is pooled with other investors used to buy various assets. Some ETFs focus on specific sectors, and gold ETFs focus on the gold industry. Some purchase actual gold, while others invest in mining companies and other firms that have a place in the gold industry.

You can buy these ETFs directly through a brokerage platform or with the help of an advisor.

Gold stocks to consider investing in now

Once you decide you want to invest in gold stocks, the next step is to figure out which ones you want to pick. The options include:

Barrick Gold Corp. (GOLD)

This is the second-largest gold mining company in the world. 

Franco-Nevada Corp. (FNV)

Franco-Nevada Corp. is not a mining company. Rather, it buys contracts to sell metals mined by other companies. 

Gold Fields Limited (GFI)

This is one of the world's largest gold mining companies, based in South Africa. 

Get a free information packet about gold investing today.

The bottom line

Investing in gold stocks is an easy way to get into the gold industry without having to actually buy gold. Investing in gold stocks can actually offer higher returns than physical gold, but it does bring the risks of the stock market with it. You can buy gold stocks directly, with the help of a financial advisor or via a gold ETF.

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