Gold investment funds differ from traditional funds in that they focus all their efforts on investing in this metal or in companies related to it, such as the mining companies that are responsible for its extraction and processing. Leaving aside this aspect, we are faced with a common investment fund.
Is it profitable to invest in a gold investment fund?
Gold investment funds have experienced impressive growth in recent years. The economic forecasts caused by the trade war and, more recently, by COVID-19, have caused investments in this refuge asset to skyrocket, generating very attractive returns.
However, to benefit from this profitability, you must have extensive knowledge of the market, since we must control very well when to start investing and the best time to redeem our shares. Without this knowledge, the profitability will not be as high as expected, since, in the long term, the profitability is quite sustained.
If you know the investment and the sector, investing in short-term investment funds in gold can be very profitable. In the long term, profitability is not as high as it seems.
How much money do I need to invest in a gold investment fund?
Although each investment fund and each entity establish a minimum initial investment, to participate in one of these investment funds in gold, you will need to have a little savings. For example, to be able to participate in the DWS fund that we mentioned at the beginning of this post, you will need an initial investment of €28,000, neither more nor less.
In addition, you must bear in mind that it is advisable to make additional contributions to obtain the best results from the investment. So you will need a little more than the value of the initial investment to be able to embark on this investment option.
Gold investment funds: advantages and disadvantages
Although investment funds in gold seem like a great option to invest our savings, we must take into account their advantages and disadvantages to know if it is the option that best suits us at the moment or if, on the contrary, another investment option or savings would be better for us.
The main advantages that we can find in this investment product are:
- Currently, this type of fund offers a very high return
- Having an investment portfolio that includes investments in gold helps to alleviate the effects of inflation and low returns on other assets
On the other hand, the disadvantages of this type of fund are the following:
- Very high level of risk, even if you have knowledge
- In the long term, the profitability of these investment funds is not so high. Only if we know how to take advantage of fluctuations will we achieve the best returns.
Are you looking for profitability in mutual funds? We have a financial advisor ready to help you.
Online course on investing in ETFs
Are you considering the possibility of investing your savings, but you are not sure which is the best option for you? Thanks to this course, 100% online and taught by experts, you will learn the principles of passive investment, as well as how to create an investment portfolio that suits your needs.