Gold has historically been regarded as one of the most reliable investment options available. It is a highly valuable asset that can pay strong returns in the long run. That said, there are several factors that you need to consider before you invest in gold.
During the pandemic, everyone was trying to look for ways to diversify their portfolio and secure their investments. Gold played a big role in making this possible. It peaked at US$ 2070.05 an ounce in Singapore in August 2020, owing to the excess demand. This was the highest ever price since 2011.
As of August 2022, the average price of gold per ounce has gone down to US$ 1843.83. Despite that, gold is considered to be one of the safest forms of investment in Singapore. Even if the market remains volatile, gold helps keep your investment safe.
Here are a few basics you need to know before you decide to buy gold in Singapore.
- Most people invest in gold since it is a safe investment. It allows investors to safeguard themselves against inflation and crisis.
- You can diversify your portfolio of investments by buying gold.
- When the economy starts to boom, gold doesn’t usually perform at par with the other assets.
Why is Singapore the Best Place to Buy Gold?
Singapore is undoubtedly one of the best places to buy gold in the world. Here is why:
Taxation Structure
Singapore is one of the cheapest places in the world to buy gold as investment grade gold, silver and platinum are exempted from the 7% goods and services tax. Investment gold is classified as gold of a purity not less than 995 thousandths with the accreditation of the London Bullion Market Association (LBMA).
Storage Facilities
As part of the city-state’s effort to boost its wealth management industry and become a regional hub for luxury collectibles and bullion trading, Singapore has established a regional’s “Fort Knox” to provide logistical solutions for gold storage. Singapore is a regional financial centre that considers gold as a financial asset and has serviced the world’s largest gold traders such as JPMorgan, UBS Group, Deutsche Bank and Australia & New Zealand Banking Group (ANZ), all of whom have kept precious metals in the vaults of the city-state.
A strong rule of law
Singapore has a strong, efficient, and transparent legal and judicial framework, as well as a strong rule of law. It has famously low crime rates which may translate to lower insurance premiums for storage. It is renowned for its neutrality in political and financial matters, a reputation that has long appealed to global investors. In 2015, Singapore imposed new obligations to prevent money laundering and terrorism financing on GST-exempt warehouses including the gold storage vaults and regular checks are conducted to ensure that they comply with regulations, allowing for complete traceability for every item stored. Nonetheless, the investor-friendly data privacy laws still protects you from unwanted scrutiny.
Well Connected
The country’s excellent connectivity as a major global transportation hub provides solid logistics infrastructure for gold to be easily brought into and out of the city. Furthermore, not only can your holdings move relatively freely, many nationalities can travel easily to Singapore as well, either visa-exempt or with a simple visa application process.
Where to Buy Physical Gold in Singapore?
When you’re looking to buy gold in Singapore, you want to buy it from the most trustworthy place possible surely. Not just that, but you also want to get the best rates possible.
So here are a few places that you can buy gold in Singapore:
Jewellery shops
You can get gold jewellery of many different designs atjewellery shops. While craftsmanship is expensive, you get to wear your gold as part of your dressing. Goods and Services tax (GST) is chargeable on new gold jewellery.
Pawn Shops
In pawn shops such asValueMax Pawnshop, you can get LBMA gold bars tax free. ValueMax is the official distributor for Swiss Pamp Gold Bars classified as LBMA bars. Other forms of gold include gold coins and renewed gold jewellery which incur negligible GST upon purchase as these are pre-owned. ValueMax Pawnshop also sells new gold jewellery with GST. The selling prices of gold for ValueMax are one of the most attractive in the market.
Bullion Shops
Bullion shops specialize in different variety and size of gold bars. If the gold bars are classified as LBMA, they will be tax free. Bullion companies may either be solely retail-based or wholesale-based.
How to invest in Gold?
If your objective of owning gold is for investment, there are different forms for your consideration:
Bullion, Bars, and Coins
You can invest in 999.9 bullion, bars, and coins which are physical gold presented in their purest form. LBMA bars are tax-exempt and accepted internationally. They have high liquidity, easily converted into cash at a pawnshop, making them a good investment choice.
Gold Certificates
If you don’t fancy the security of holding physical gold, you can buy gold certificates. Companies that own gold can give you gold certificates instead of physical gold. These certificates are easier to store compared to their physical counterparts.
Gold Savings Account
This is also a good option if you don’t want to buy physical gold. Instead, you can just create a gold savings account. Certain banks may offer such a product by allowing you to invest as low as 1 gram of gold using this type of account, which you can pay using cash.
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Gold stocks, mutual funds and ETFs
Investing in a gold stock, ETF or mutual fund gets you the exposure to gold in your portfolio. In order to buy a gold stock or fund, you will have to first open a brokerage account open with a broker. Once your account is funded, you will be able to pick the gold-related assets you would like to invest in and place an order for them through your broker.
Gold Futures
A gold futures contract is an agreement to buy or sell a certain amount of gold at a later date. Gold futures enjoy more liquidity than physical gold without management fees, though brokerages may charge a trade fee per contract.
Gold Coins
Buying gold coins is another good option for gold investors. Gold coins are popular for their history and their aesthetical appeal.
When to Buy Gold in Singapore?
While gold prices aren’t at their lowest, you should still consider buying gold and adding it to your investment portfolio as gold investment helps to counter inflation.
Looking at the market’s volatility, most people tend to shy away. The truth is that this shouldn’t stop you from investing.
All investments have some degree of risk involved. You need to focus on diversifying your portfolio to spread risk.
That said, you need to make sure that you buy it from trustworthy merchants. If you hold physical gold, you need to ensure your gold is kept safely to secure your investment. Making wrong investment choice could compromise your financial security.
Singapore Gold Price Today
Gold prices in Singapore are available on financial websites, news portals, and specialized applications. They include spot and retail prices, which take into account fabrication, handling, and profit margins. Global supply and demand, currency exchange rates, geopolitical tensions, global economic circ*mstances, and inflation rates all have an impact on prices.
Investors and individuals looking to buy or sell gold in Singapore keep a careful eye on the price. Because of the daily swings in gold prices brought on by market dynamics, it is advised to check for updates regularly. If you are less experienced with gold transactions, we recommend consulting professionals or reputable sources.
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