Physical holdings
Bars and coins are direct ownership of metal. They carry storage, insurance, authentication, and considerations, and dealer premiums mean the purchase price differs from the spot quote.
Exchange-traded products
Gold ETFs track the gold price through a fund structure. They are convenient and liquid, but the holder owns shares in a fund rather than metal, and fund expenses apply over time.
Futures and leveraged instruments
contracts are standardised agreements to transact at a future date. They involve , requirements, and expiry mechanics, which makes them materially higher-risk and unsuitable as a starting point for a beginner learner.
Understanding how an instrument works — including how it can lose money — is a prerequisite to any decision about it.
Key takeaways
- Physical: no counterparty, higher friction.
- Financial: liquid and cheap to trade, relies on institutions.
Knowledge check
Which form typically has the lowest trading friction?
Key terms · hover or tap for a definition