8 Types Of Gold Trading

Gold trading

 continues to attract more traders and investors due to its significance in increasing wealth and profit. The increasing demand of gold made global indicators to acknowledge it as an attractive form of investment.

The 2008 financial crisis had a huge impact in the world and the economies. There was a decline in the confidence of consumers and investors as economies struggle with recession, declining currencies and unemployment. This led people to consider going into gold trading especially as this commodity remains the asset that is largely un-eroded. In this discussion, we will cover the number of ways traders and investors can trade this commodity.

Spot Trading

This is a form of gold trading that involves holding a position on gold as well as an opposing position on the U.S Dollar. You are simply trading the inverse price moments of the US dollar and this precious metal. Meaning, if you grab a long position on this precious metal, then you will be holding a matching short position on the US Dollar and vice versa.

Binary Options

Binary options, also known as digital options or fix odds options trading. This is a form of trading that involves the buying (call option) or selling (put option) of a contract for an asset to benefit from a price increase (for buy) or price reduction (for sell) at the time the contract expires.

Gold Exchange Traded Funds (Gold ETFs)

You can trade this precious metal by way of ETFs. The stock exchange is usually the venue where you can trade this financial instrument. ETSs are really a type of investment fund that are comparable to a mutual fund yet different since they are more aggressive. The ETF is generally composed of a portfolio of a number of different financial instruments.

Gold Futures and Options

A gold future indicates a commitment to deliver a specific amount of gold, on a specific time, at a specific price. While gold options authorize (not oblige) traders to deliver or handle delivery of a specific quantity of this precious metal on a specific data at a specific price.

Buying Gold Bars

Buying gold bar is a form of investment that has been practiced for many years by people who can afford it. It simply involves the process of purchasing gold, storing it then selling it at the time the price of this commodity has increased or use it as a form of collateral to acquire loans.