Sunday, January 23, 2011

WHY I PREFER PHYSICAL GOLD INVESTMENT COMPARED TO PROPERTY INVESTMENT (and any other investments)?

You do what you know best. That is the main thing we should remember. However, we should not stop from continuous learning as it improves your kowledge and enhance your understanding of a certain topic. Money management is very important. The Malays especially, are generally weak on this topic. However small your savings are, you must know when to save, where to save, how to manage your money, how to read financial statements, the definition of some financial jargon and many more. It is also important to make wasiat on your assets before you pass on.

I have a few reasons of my own why I choose physical gold investment compared to property investment and any other types of investment.

  1. It is convenient to buy physical gold
  2. Physical gold is very liquid
  3. I can choose not to do anything after I buy gold
  4. The Retun on Investment for gold is high
  5. I can do my own small business with physical gold
  6. I know what to do if I need more money
  7. I can enhance my knowledge on physical gold at ZERO cost
  8. It is a safe investment


1. It is very convenient to buy physical gold

I buy gold bars & dinars from Public Gold. Why I say it is convenient?
Because 1. I can choose to buy them at any time of the day or even night. Public Gold publishes its prices in their website and I can see the gold price at any point of time to buy or even to sell. Besides Public Gold website, you can easily see the prices of all products sold by Public Gold at the right-hand side of this blog. The price changes every 20 minutes to reflect live gold price.

If you have some knowledge on technical analysis, it will be better for you as you have an advantage to knowing to forecast the gold price.

With property, I know how much one property will cost me. But I do not know the price of the property in future. Even if I revalue the property (it costs me to do one), buyers will normally ask for discounts from the revaluaed amount. Unless, the property is in a very very HOT location. Thus, the property price is very subjective and depends on many factors.

Besides, the no 2. reason, I can collect the gold from Public Gold, Sunway branch conveniently. I stayed in Shah Alam, very close indeed. Public Gold offices are now everywhere, Penang, of course, Ipoh, Kota Bahru, Johor Bahru, Sarawak.

2. Physical gold is very liquid

I know where to buy, very important. And I know where to sell. That's even more
important. Public Gold Dealers are always willing to buy your gold. Just call one and ask. I can also go to Public Gold office to sell gold bars or dinars. If today, I bring the gold, by tomorrow, the money will be banked in the account. Easy, eh! Can I do that with property? Nope! I will be lucky if I can find buyer within 3 months after I advertise. That is, selling at MY price. Not discounted price.

Physical gold is known globally, anyway. Gold is one of the wanted precious metal (by the ones who know ~ bak kata pepatah 'Hanya jauhari yang mengenal manikam').
Just waive the gold to those who are keen and they will offer you to buy.



3. I can choose not to do anything after I buy physical gold

If I want, I can just keep my gold in the safe deposit (after I hold & admire them in
my palm)
and leave it there . The price of gold will definitely goes up medium to long term.

I cannot do that with property. If my aim is to gain monthly income from the property, I have to find tenants for it. I have to deal with the tenants' issue, late rental payment, attending their complaints on the house, maintenance cost, unpaid utility bills, tenants dissappearing in the midnight etc etc. There is so much work to buy property and yet more work when you own one.


4. The RETURN ON INVESTMENT FOR GOLD is high


Return on investment for gold within one year 2009/2010 is high, reaching 28%. Average 10 years return on investment of gold is 371% or 37% per annum. You can sight http://www.kitco.com/ for historical prices for gold and other metal.

With property, you may get higher return but there is a high chance you get negative cash flows from the property too. What is negative cash flow? Negative cash flow on property happens when the monthly instalment amount you are paying the bank is higher than the net rental income you receive. Have you experience this? If you invest in apertments and condominium, do not forget that you have to pay maintenance fees.

I have wrote earlier on comparison Return on Investment of physical gold with Amanah Saham Bumiputera (ASB). Feel free to look up for the article. A good reading indeed.

  1. ASB Dividend Announcement

  2. Dividen ASB RM35,000 diserahkan kepada BaitulMal


5. I can do my own small business with physical gold


Because of its transparency, I can easily tell my friends about physical gold investment. Basically you can find a lot of info in Public Gold Website. The company, its directors, the mission & vision, the achievements, the products they are selling, the live gold prices, online ordering and many others. You can gain a lot of knowledge going to various talks organised by Public Gold as well as looking up for the published articles fom various counterparts in Public Gold website.

Besides, with Public Gold, I can start the gold business with only RM20,000 and I get my own physical gold from it. Do you know the benefits of becoming Public Gold Dealers? No? Why didn't you ask?

As for properties, if you use RM20,000 as deposit for a purchase, you can get a property of around RM200,000 in value. Where can you find a decent residence of RM200,000 in Klang Valley? Nowadays government has imposed ceiling for property financing at only 70%. If RM20,000 is your deposit of 30%, you can only get a property valuing around RM70,000. What type of property you think you can get valued at RM70,000? Where will it be? How much do you think you need as deposit if you want to buy RM300,000 property value? RM90,000. Wow! Having spent so much, the return is also not guaranteed.





6. I know what to do if I need more money

You have to learn up ArRahnu techniques to know. Don't worry, the process is easy. Bring your gold to ArRahnu Agro Bank and in less than 2 hours, you can get 70% out of your gold.

If you have only properties in investment, you can also get financing from it. If you mortgage it, you can be financed provided that you have fully paid the properties. However, the process is a long process, 2 weeks to longer, depending on the financial institution and the timing of the application.


7. I can enhance my knowledge on physical gold investment at ZERO cost

Public Gold support dealers in terms of knowledge. We have talks on

  1. Gold Investment

  2. Silver Investment

  3. Market Updates

  4. New Dealers Orientation (NDO)

All talks are FREE! Except for NDO, you have to pay RM10.00 for the certificate.

So far, all Property Investment Talks have to be paid at a 'handsome' price.



8. It is a safe investment


You can choose to keep your gold in Safe Deposits. Thus, there is no need to be
scared to invest in physical gold.


So, dear friends, I have listed my reasons for having physical gold. What are your reasons for NOT investing in physical gold? Have fun browsing my blog searching for more answers. You know what? We learn faster through asking the right questions to the right people. That's what I did, and I am glad I did it. Let me help you finding your answers.


BTW, I have an apartment to sell. Anyone would like to purchase it? Message/text me. I plan to convert it into gold.


If you are still keen on property investment, learn from the master, Azizi Ali, the Property Millionaire. Here is an interview with Azizi Ali by Star Property. I simply love to give extra knowledge to my consistent readers.

GO TO INDEX for more articles.

Have fun reading!

11 comments:

  1. wow! a good article. simple and easily understand.

    ReplyDelete
  2. Then...I know where to park my saving.....

    ReplyDelete
  3. Thank you for visiting my blog. Hope that you benefit from reading them.

    ReplyDelete
  4. Salam,
    very informative..am ideed interested..

    ReplyDelete
  5. Wa'alaikum salam. Thanks Sally.
    There's a huge opportunity in gold & silver. Learn up as much as you can.

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