EXPLAINER | What to know about investing in gold
As a consumer, you cannot possess unwrought gold, only gold crafted into bullion coins, miniature gold bars, medallions, or jewellery.Gold jewellery is less reliable as an investment than bullion.You can invest in gold directly, by buying the physical metal in some form, or indirectly through financial instruments such as shares or investment funds.One troy ounce equals 31.1g and is 9.7 percent heavier than a regular ounce, which equals 28.35g.
South Africa has a gold investment coin, the Krugerrand, which is minted by the South African Mint and recognised as legal tender by the SARB.Launched in 1967, the modern Krugerrand introduced the concept of a bullion coin linked to the daily gold price. This is because the value of the item lies more in its design and craftsmanship than in the spot price of the gold from which it is made.This makes it difficult to value when you want to sell it.For this reason, gold jewellery is generally regarded as falling into the category of alternative asset classes that includes art and antiques.
Of this 33 percent was used in jewellery, six percent was used for industrial purposes and the remaining 61% was used for investment purposes.
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