A beginner’s guide to Precious Metals

Today’s investors continue to turn to precious metals as a way of storing value, hedging against inflation or protecting their portfolios during economic downturns as they have for centuries.

How Precious Metals are priced

The price of a precious metal is denoted as the spot price. Like other commodities and stocks, the value of precious metals varies over time. Prices are commonly defined as a dollar value per mass or weight and are consistent for all commodities of the same type and grade.

Supply and demand relationships are sometimes used as a starting point in assessing the price of precious metals. However, a variety of economic and geopolitical factors can influence price movement and volatility.

Two ways to invest in precious metals

At Scotia iTRADE®, we offer clients the opportunity to invest in gold, silver and platinum through eCertificates or commodity Exchange Traded Funds (ETFs):

Brokerages issue precious metal eCertificates to an investor which signifies the ownership of a specific quantity of the metal. eCertificats are non-physical certificates that are held “electronically” in a brokerage account and provide you with the benefit of ownership without the burden of transporting and storing the precious metals.

When purchased through us, all eCertificates are backed by Scotiabank assets, providing you with an extra level of security.

Commodity Exchange Traded Funds
You can also invest in precious metals through commodity ETFs. Unlike precious metals certificates, commodity ETF might carry additional investment risk.

In addition, you have the option of choosing commodity ETFs that comprise of interrelated securities directly linked to a precious metal, such as miners and producers. This may be a good option if you’re looking to invest in a precious metal while leveraging market strategies and market liquidity at the same time. When considering commodity ETFs for precious metals, keep in mind the risk involved in security trading and applicable Management Expense Ratio (MER), which may affect your investment goals and risk tolerance.

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Watch this video to learn more about ETFs 

How to order

To place your order of gold, silver, platinum or commodity ETFs, contact a Scotia iTRADE representative at 1-888-872-3388. For your convenience, you can also invest in commodity ETFs online by signing into your Scotia OnLine®Account.

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