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Gold’s remarkable price performance in 2024 captured the attention of investors worldwide, and for good reason. The precious metal’s swift uphill trajectory began early in the year, with gold shattering numerous price records before closing in on nearly $2,800 per ounce. This dramatic surge in value sparked renewed interest in gold and led to early investors turning a quick profit on what has historically been considered a long-term investment.
While gold’s price moderated somewhat in the time since, it recently began to tick upward once again, with the price of gold now approaching $2,700 per ounce. This upward trajectory is once again attracting both seasoned investors and beginners to the gold market, with many seeking to capitalize on the metal’s newfound momentum. But this uptick in price has also led many to question the most strategic way to enter the market.
For those looking to invest in physical gold, one decision worth making right now is whether 1-gram or 1-ounce gold bars are the better bet. After all, each one offers distinct advantages for different types of investors, so it’s important to know which gold bar option makes more sense in the current market.
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Why 1-gram gold bars could be the better investment right now
When investing in physical gold, 1-gram gold bars are a popular option, particularly for newer investors or those working with limited capital. At today’s prices, these smaller units come with a price tag of about $115 to $120 on average (depending on the mint, the design and other factors), making them significantly more accessible than their larger counterparts. This lower price point offers several key advantages in the current market environment.
The first is that the lower cost of 1-gram bars enables investors to gradually build their gold positions through dollar-cost averaging, spreading out purchases over time to potentially reduce the impact of price volatility. This strategy can be especially valuable given gold’s current high prices, as it allows investors to maintain exposure to the precious metal without committing large sums at once.
These smaller units also offer superior flexibility in terms of liquidation. Investors can sell portions of their gold holdings as needed without having to liquidate a full ounce at once. This granular control over position sizing can be particularly beneficial for those using gold as an emergency fund or those who may need to access their investment in smaller increments.
Plus, 1-gram bars can serve as an excellent educational tool for those new to precious metals investing. The lower financial commitment allows investors to familiarize themselves with the physical gold market, including aspects like storage, authentication and trading, while minimizing the potential risks.
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Why 1-ounce gold bars could be the better investment right now
Despite their higher initial cost, 1-ounce gold bars also offer compelling advantages that may make them the superior choice for certain investors in today’s market. At today’s prices, these larger units typically command premium prices of about $2,700, but they come with several unique benefits.
Perhaps the most significant advantage is their lower premium over spot price compared to smaller units. While 1-gram bars often carry hefty premiums above the spot price of gold, 1-ounce bars typically feature significantly lower premiums. This more favorable pricing structure can result in substantial savings for investors who are planning to accumulate significant positions in physical gold.
1-ounce gold bars also offer greater efficiency in terms of storage and transportation. For example, storing 30 1-gram bars requires more space and potentially higher security costs than storing a single 1-ounce bar of equivalent value. This efficiency extends to insurance costs, which are often calculated based on the number of units rather than just the total value.
For investors planning to hold their gold long-term as a hedge against economic uncertainty or inflation, 1-ounce bars also typically prove to be more practical. Plus, their standardized weight and wider recognition can make them easier to sell or trade when dealing with larger dealers or international markets.
The bottom line
Both 1-gram and 1-ounce gold bars can serve as valuable components of an investment portfolio in today’s market environment. To decide which option is best for you, though, it may help to align your choice with your financial situation, investment goals and practical considerations. For some investors, a combination of both sizes might even prove optimal, providing both the flexibility of smaller units and the cost efficiency of larger bars.
