Investing Fears and How to Overcome Them

No Passive Yield or Income

A common concern among investors is that precious metals do not generate passive income like dividend-paying shares or rental property. However, precious metals are not typically intended to serve the same purpose as income-producing assets. Instead, they are often used as a strategic diversification tool, helping investors spread risk across different asset classes and reduce their reliance on the performance of stock markets alone.

While gold and silver do not provide a regular yield, their value lies in their potential to preserve wealth over the long term.

Historically, precious metals have been viewed as a store of value and a potential hedge against economic uncertainty, inflation, and periods of market volatility.

For this reason, many investors allocate a portion of their portfolio to precious metals alongside equities, bonds, and other investments.

By including precious metals within a diversified portfolio, investors can add an asset that often behaves differently from traditional financial markets. This can help improve overall portfolio resilience during periods of turbulence, while maintaining exposure to long-term growth opportunities elsewhere.

Key benefits of precious metals investing:

• Diversifies investment portfolios beyond stocks and bonds.
• Provides exposure to a tangible, globally recognised asset.
• Can help hedge against stock market volatility and economic uncertainty.
• Historically regarded as a long-term store of wealth.
• Designed to complement income-producing investments, not replace them.
• Supports a balanced investment strategy focused on both growth and preservation.

Risk of Counterfeits or Being Defrauded

For many first-time precious metals investors, concerns about counterfeit bullion are entirely understandable. The good news is that by purchasing from reputable bullion dealers significantly reduces this risk. Leading institutions such as The Royal Mint, The Perth Mint, and the Royal Canadian Mint have built global reputations for quality and strict manufacturing standards, making their products highly trusted by investors worldwide.

Modern bullion products are also designed with advanced security features to help combat counterfeiting. Many coins and bars incorporate a range of micro-engraved markings, radial and textured designs, laser-etched latent images, and highly detailed finishes that are extremely difficult to replicate.

These features allow both dealers and investors to verify authenticity with greater confidence.

Whether you're buying your precious metals online or in-person, by purchasing from recognised bullion dealers, investors also benefit from secure supply chains, product verification procedures, and full traceability back to the originating mint. This provides an additional layer of protection and reassurance that the products being purchased are genuine.

Key points to remember:

• Purchase bullion from established, reputable bullion dealers.
• Choose products from globally recognised mints such as The Royal Mint, The Perth Mint, and the Royal Canadian Mint.
• Modern bullion incorporates sophisticated anti-counterfeiting technology.
• Many products feature micro-engraving, mintmarks, and laser-etched details.
• Reputable dealers partner with and source directly from authorised distributors and mint networks.
• Authenticity concerns can be minimised through trusted products, established dealers, and proper verification processes.

For most investors, the risk of counterfeit bullion is not eliminated by luck, but by following best practice: purchasing recognised products from trusted dealers with proven industry credentials.

Security and Insurance Worries

A common concern among precious metals investors is how to keep their bullion secure, and whether storage and insurance costs outweigh the benefits of ownership. Fortunately, investors today have access to a range of professional storage solutions that make owning physical gold and silver both convenient and secure. Rather than storing valuable bullion at home, many investors choose to utilise specialist vaulting services offered by trusted bullion dealers and storage providers.

Professional storage facilities are specifically designed to protect precious metals, employing state-of-the-art security vaults, 24-hour monitoring, controlled access systems, and regular audits. Many services also offer fully insured storage, meaning your bullion is protected against theft, loss, or damage while held within the facility. This can provide valuable peace of mind without the responsibility of managing security yourself.

At Chards you can store your precious metals straight from checkout, in our fully insured, high-security vaults. Whether you're investing for the long term or just want peace of mind, our storage service offers a simple, flexible solution.

To find out more about our storage solutions, check out our Vaulted Storage & Fees page.

Key points regarding storing bullion:

• Professional vaulting services provide a secure alternative to home storage.
• Trusted bullion dealers often offer access to fully insured storage solutions.
• High-security vaults utilise advanced surveillance, restricted access, and regular audits.
• Insurance can protect stored bullion against theft, loss, and damage.
• Secure storage removes the burden of safeguarding valuable assets personally.
• Investors can own physical precious metals without compromising convenience or peace of mind.

For many investors, secure storage and insurance are not obstacles to precious metals ownership, they are simply part of a professional solution that helps protect their investment for the long term.

Premiums and Taxes

Some investors are concerned about the premiums associated with purchasing bullion, as well as the potential impact of taxes when they eventually decide to sell. While these are important considerations, precious metals are typically viewed as a long-term investment, where the focus is on wealth preservation, portfolio diversification, and protection against market uncertainty rather than short-term trading. Over time, the benefits of holding physical precious metals can outweigh the initial costs for many investors.

UK investors also have access to several tax-efficient bullion options.

Gold bullion over .900 fineness qualifies as investment gold, making it VAT-free, whilst coins from The Royal Mint such as the Gold Britannia and Gold Sovereign also benefit from Capital Gains Tax (CGT) exemption for UK residents because they are UK pound sterling legal tender.

This means any profit made on their sale is free from CGT, making them particularly attractive for long-term investors.

For silver investors, VAT will apply to new purchases within the UK, however, purchasing secondhand allows use of the VAT Special Scheme. Some investors also choose to hold their silver in professional bonded vaults located in the likes of Zurich, Switzerland, where the silver remains outside of UK tax jurisdiction and can be bought and sold without incurring UK VAT while it remains in storage. VAT would generally only become payable if the silver is imported into the UK through physical delivery.

Key points to remember:

• Precious metals are generally best suited to a long-term investment strategy.
• Investment-grade gold bullion is VAT-free in the UK.
• Gold Britannias and Gold Sovereigns are popular CGT-exempt options for UK investors due to their legal tender status.
• Tax-efficient products can help maximise the value of long-term holdings.
• VAT-free silver solutions are available through bonded storage facilities in locations such as Zurich.
• Reputable bullion dealers can help investors understand the tax treatment of different products and storage arrangements.

Liquidity and Counterparty Delays

We have also seen a common worry that physical precious metals may be difficult to sell quickly, or that they could face delays when accessing their funds. In reality, bullion is one of the most widely recognised and actively traded assets in the world.

When investors purchase through established bullion dealers, they typically gain access to straightforward buyback services that can simplify the selling process. Reputable dealers regularly quote live market prices and are often willing to repurchase widely recognised bullion products, allowing investors to convert their holdings back into cash when required. The most popular coins and bars tend to be the easiest to trade due to their global recognition and demand.

While settlement times can vary depending on the dealer, payment method, and whether the bullion is held in storage or delivered physically, working with trusted providers helps minimise counterparty risk and potential delays. Many professional storage services also allow investors to sell vaulted bullion directly from storage without arranging physical delivery first, making the process faster and more efficient.

Key points to remember:

• Gold and silver bullion are traded in active global markets.
• Products from leading mints are widely recognised and easy to resell.
• Reputable bullion dealers often provide dedicated buyback services.
• Popular coins and bars typically offer the strongest liquidity.
• Professional vaulted storage can enable faster sales without physical handling.
• Using trusted dealers helps reduce counterparty risk and unnecessary delays.
• Precious metals can often be converted back into cash quickly when required.

What About...?

Hopefully this blog helped ease some of those common worries when it comes to investing with precious metals however, if you have any questions or concerns, please feel free to contact us and our friendly UK-based staff will be happy to assist.