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Business 322 views Dec 17, 2019
What to Expect from Your Precious Metals Company

Buying gold and precious metals is a prudent wealth protection strategy. Gold bullion bars and coins offer a long-term, stable, yet easily liquidated investments. It diversifies your portfolio in a secure, confidential way that is not available with financial products.

But who should you buy your precious metals from and what should you expect?

 

Buying gold is more accessible than ever before

Nowadays, purchasing gold bullion is far more accessible than it ever used to be, and therein lies the issue. Greater access doesn’t necessarily translate into a better and safer service.

Before you commit to purchasing a single ounce of precious metals, you should ensure your precious metals company is not only reputable and reliable but that they offer you the services you need at the highest level possible.

 

Precious metals companies must be reputable - Do your due diligence

Proper due diligence should be your first step when considering any investment. Buying gold or precious metals should not be any different. You can start with a simple Google search, looking for reviews or media coverage. Make sure you trust the sources, because there are those who buy positive reviews and write-ups. But you should also dig deeper than that.

 

Check their corporate standing

Check whether the company is legally registered and tax-compliant. Most jurisdictions have databases you can search for free (or for a nominal charge). If the company is public, you should be able to review their financial statements. If they are private, ask for them.

 

Does their pricing add up?

Compare their prices and services to other similar companies. If they’re pricing or fees seem too good to be true, there’s a chance they are.

 

Ask for references

Don’t be afraid to ask for references. Many people invest in precious metals because of the anonymity it affords them, so you shouldn’t expect a long list of contacts. Nevertheless, this could give you some insight on how they will treat your information. And if you do get to chat with a client, try to get as much information about the process as well as their opinion about the company. While they should protect their clients’ privacy, precious metals companies should be transparent about their business practices.

 

What’s their full-service offering?

Often companies perceived merely as precious metals companies offer much more than simply buying and selling bullion bars and coins. Many companies offer additional services to facilitate your precious metals purchase and ownership. But don’t let that distract you from finding out about their practices.

You can check whether they are associated or affiliated with reputable organizations such as the London Bullion Marketing Association (LBMA) or the Singapore Bullion Marketing Association (SBMA). Are they members? Do they follow association standards or procedures? Do they association refiners and logistics companies?

 

Where & how are metals sourced & shipped?

Make sure you’re fully aware of how and where your providers source their precious metals. Do they comply with the LBMA or SBMA’s Good Delivery standards?

Do they offer only gold? Your choices for buying precious metals go beyond bullion bars or coins. You should also consider where you want to keep your gold or silver.

What storage and transporting options are available? Do they offer insurance of any kind? How quickly can you take ownership or possession?

Remember, once you take ownership of your precious metals, you may have little to no recourse if there’s an issue with purity or if something happens during transport or storage. Unless you plan ahead and take the proper precautions with a reliable precious metals company assisting you.

 

Shipping, location & storage

You may think keeping your precious metals at home in a safe or in a bank’s safety deposit box is your best option. But is it the most secure option?

Many companies work with high-security storage facilities and vaults, sometimes with multiple locations around the world. If you’re considering a secure offshore location for part of your portfolio, be sure to ask how can you physically access your precious metals at the facility.

Make sure to also ask in-depth questions about this service. Where are the vaults located? How secure are the locations? Does their delivery service include customs clearance and logistics insurance?

 

Liquidation options

What if you need to quickly liquidate part of or all your holdings? Think of the time and risk you would need to take to do that on your own. A precious metals companies should have more convenient and expedient options. How soon from being notified can your provider execute your buy or sell order? How securely and to what degree of customization are they open for this transaction? Will your buy or sell orders have immediate effect? Do they offer global delivery on an immediate basis? How is your metal shipped to you and with what insurance?

 

How do you feel about the sale?

If the company is trying too hard to get you to buy, you may want to rethink your decision. This is a big step that shouldn’t be taken lightly. A hard sale approach, or a situation where you’re feeling strong-armed, is not what you need. If a company is trying too hard to close the deal, they may be leaving out information you need to be aware of.

Reputable full-service precious metals companies will want to make sure you’re an informed investor. They should be ready to answer all your questions before and during any business you conduct with them. They will also need to conduct their own due diligence process with you to be compliant with global regulations.

 

Conclusion

You’ve decided to invest in precious metals for the peace of mind it offers. Make sure that whoever you engage to buy, sell, transport, or store your precious metals reinforces that peace of mind.

 

About the author

Joshua Rotbart (LLM, MBA) is a Founding Partner at J. Rotbart & Co. and a world-renowned expert in assisting those wishing to buy, sell, ship, and store physical precious metals. Joshua works with family offices, independent financial advisors, and high-net-worth individuals to discreetly and sensitively provide tailored solutions for their precious metal needs.