Physical Gold vs ETF for investment - analysis

BarTender

BarTender

Active Member
Posting this on here is a bit like Preaching to the Choir, but I am a numbers guy, I like to analyse things, even if it just confirm my own beliefs, sometimes you learn something, sometimes you don't.

Scenario:
  • You have enough money to invest in 10oz of Gold on 1st Feb 2022.
  • You can invest:
    • Direct in Physical gold
      • Assume buy at 1% over spot
      • You can sell at spot.
      • No cost to store
    • You can buy shares in an ETF, this is via any stockbroker, but
      • Assume $0 brokerage eg Betashares Direct, or Stake (actually $3)
  • You then hold it to today, and we analyse worth every 12 months, and see how each preforms.
  • Any risks are ignored.

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Conclusion -
1. The longer you hold, the better physical gold is (duh)
2. If you want to take advantage of price moves < 24 months, you are better off with ETF.
3. There is not that much in it in a 3 year time frame, even more so for smaller amounts, do whatever makes you happy :)
 
Don't forget to figure in the taxes you will owe on the etfs vs selling the physical to some random anonymous guy on the street with no records.

That will make a big difference.
 
JohnnyBravo300 said:
Don't forget to figure in the taxes you will owe on the etfs vs selling the physical to some random anonymous guy on the street with no records.

That will make a big difference.
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Try telling shiney that........
 

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It won't be long here and you'll pay tax on the difference in value since you bought an asset even if you haven't sold it.

Unrealised capital gains tax on Superannuation is soon becoming a reality.
It will become normalised and then applied to all assets.
 
If you kept your Ford Escort from 1980, and it is in good condition, it is worth $70,000+ now - private car is however exempt from CGT.
Collectable under $500 is exempt.

That there is no exemption limit for metal is stupid, like you give a gift of fractional gold, in theory you need record your disposal, they need to account for the date they recieved at market value etc.

The one that gets me is the - Personal Use Item Exemption - eg say you know your stuff, and you buy furniture that was made in limited quantity by some designer etc and the value increases above $10,000, the exemption for Personal Use Items only applies below $10,000 so CGT applies if you sell it. BUT the kicker, if you you bought for $15k and it drops to $12k, you can't claim that loss. Not even against other furniture at a gain. ATO simply disregards the loss.

Same with a boat if more than $10,000 - CGT if you sell it for more than you paid.... although I don't know anybody who made money on boat, woudl be great if you could claim capital loss though :p
 
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Sounds like an honor system where you would first have to claim that you even own gold for tbe unrealized capital gains, then you'd tell them what you sold so you can pay the taxes after.

Sounds like Stockholm syndrome to me.
 
JohnnyBravo300 said:
Sounds like an honor system where you would first have to claim that you even own gold for tbe unrealized capital gains, then you'd tell them what you sold so you can pay the taxes after.

Sounds like Stockholm syndrome to me.
Click to expand...

You can call it what you like.

But in Australia for most people and most assets if you've had a capital gain then it must be declared in your annual return. Of course some people don't either accidentally or deliberately. Tax avoidance is not condoned by the owner nor the administrators of this forum. Therefore any conversation around tax avoidance is best taken somewhere else ie not on this forum.
 
As some Super industry funds have an option to buy shares and ETF (eg Australian Super Member Direct), it is the only way I know to put gold in your Super without going down the path of having a Self Managed Superfund.
 
mmm....shiney! said:
You can call it what you like.

But in Australia for most people and most assets if you've had a capital gain then it must be declared in your annual return. Of course some people don't either accidentally or deliberately. Tax avoidance is not condoned by the owner nor the administrators of this forum. Therefore any conversation around tax avoidance is best taken somewhere else ie not on this forum.
Click to expand...

So the OP is from OZ too.
We don't have any taxes on bullion in the US.
I got it now.
 
^ he makes some good points, but also points that are erroneous and commonly pushed by pollies, the media and special interest groups which turn out to be the source of our economic and social problems.
 
Yes it is a senate comitee , and he is grandstanding in front of the cameras - he was well known as a ruthless business man and certainly has his own interest first and foremost in mind, and he controlled more than Murdoch what was in the Oz media at the time.

His helicopter pilot donated his kidney to Kerry - as it is illegal to pay someone for an organ in Australia, I always wondered how he was rewarded, because Kerry was known to tip huge sums - he once paid a Casino waitress' mortgage because he bumped into her.
 
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