Why trade gold and silver?

Gold and silver have historically been safe-haven assets in times of market uncertainty. Learn the full benefits of trading gold and silver with our in-depth guide.

Precious metals, particularly gold and silver, have been traded since prehistoric times. The reason for their high value is due to their rarity. They are expensive and difficult to mine, consistently in demand for their decorative and physical properties, used for jewelry and decoration, and function as a medium of exchange either by weight or in the form of coins.

In the modern world, they have retained their appeal for jewelry and coinage, and have increased in importance because of their use in electronic equipment and medical applications.

They are also seen as stores of wealth or safe havens in times of economic instability.

Physical trade in gold and silver

Unlike other commodities, gold and silver have a high intrinsic value. It is perfectly feasible to trade in bullion or coin. Many investors have some of their holdings in physical metals, although there will inevitably be costs for storage and insurance.

Commodity traders dealing directly in gold and silver aim to buy when the price is low, which is usually determined by an abundance of supply and falling demand. They sell when they believe the supply is outweighed by demand, which can result in a profit.

However, like other commodities, the price of gold and silver can fall as well as rise, and this approach can be a disadvantage when prices are falling.

Spot trading gold and silver

FOREX.com allows you to trade gold and silver at the current spot price of gold, which is based on the price of the most active futures contracts on the COMEX (Commodities Exchange) in New York. Because these futures contracts are actively traded in a central location every single day, they provide the most accurate, up-to-date prices for gold.

Find out more about what gold and silver trading is.