Gold Hits New Record Highs As Safe-Haven Demand Climbs: 2 Ways To Invest 2 Ways To Invest in Gold - SPDR Gold Trust (ARCA:GLD)

Gold has long been a cornerstone of personal finance strategies, prized for its role as a hedge against inflation and economic uncertainty. Investors have two primary avenues to gain exposure to gold: purchasing physical gold or investing in gold exchange-traded funds.

Each approach offers unique advantages and drawbacks, making the right choice dependent on financial goals, risk tolerance and investment horizon.

Physical Gold: Physical gold refers to tangible assets, such as gold bars, coins and jewelry. An investment in physical gold is appealing to some investors as it is independent of banks or financial institutions with no digital records or intermediaries involved. Gold's intrinsic value and historical role as a store of wealth also make it appealing for generational wealth transfer.

"Amidst the recent stock market turbulence, we're seeing renewed interest in tangible, physical assets that exist outside traditional financial structures," Tim Schmidt, the founder of Gold IRA Custodians, told CNBC.

However, the costs of secure storage and insurance can be high and the market for physical gold can be relatively illiquid with transactions sometimes incurring delays before a buyer or seller can be found. Also, physical gold does not generate interest or dividends so returns can only be realized when the gold is sold.

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Gold ETFs: Investing in a gold-focused exchange-traded fund can provide investors with exposure to gold's price movements without the need to own or store the metal directly.

"For most [investors], I would say a gold bullion-backed ETF makes the most sense," Sameer Samana, head of global equities and real assets at the Wells Fargo Investment Institute, told CNBC.

Both the SPDR Gold Trust GLD and iShares Gold Trust IAU, are backed by physical gold bullion held in secure vaults, and each share represents a specific amount of gold.

Investors can also find exposure to gold through the VanEck Gold Miners ETF GDX, tracking the performance of the NYSE Arca Gold Miners Index, and the VanEck Junior Gold Miners ETF GDXJ which focuses on smaller, early-stage gold miners, offering higher growth potential but increased volatility.