12 Jun 2025

How to invest in Gold in Australia?

For thousands of years, gold has served as a store of value – and today, it remains a popular portfolio diversifier. In this article, we explore gold’s track record as an investment and how you can start investing in gold in Australia.

Gold as an investment

Precious metals have long appealed to investors, but gold stands apart. Its financial ties go back millennia, with the first gold coins issued by ancient societies. In fact, the global financial system operated under some form of gold standard until 1973.

Even now, central banks hold about one-fifth of all the gold ever mined.[1] While we’ve moved beyond the gold standard, the metal remains a key investment asset.

In 2024, global gold demand climbed to nearly 5,000 tonnes, partly driven by increased investment activity.[2]

Gold doesn’t generate interest or pay dividends – but few assets can claim such a long history. While the makeup of stock and bond markets may change over the next century, gold is likely to endure.

Why invest in Gold?

Gold prices have changed significantly over the last 50 years. Back in 1980, gold hovered around $600 – a level it maintained for decades. But the 2008 financial crisis reignited interest, pushing prices above $1,500.

Today, gold trades above $5,000, buoyed by rising trade tensions and geopolitical uncertainty. It’s long been viewed as a safe haven during market turbulence. This reputation is supported not just by its history, but also by its limited global supply.

As a real asset, gold may help hedge against inflation. That said, its diversification benefits aren’t flawless. For instance, during the 2020 market crash, gold and the S&P 500 moved in tandem for several months.[3]

Price data sourced from the World Gold Council, in AUD per troy ounce.[4]

Methods of investing in Gold

There are several ways to invest in gold. The right approach depends on your financial goals and appetite for risk.

1. Physical gold

Buying physical gold means acquiring bullion or coins. Some investors like the tangible aspect, particularly those wary of the global banking system. But owning physical gold comes with trade-offs.

Storing it securely can be a hassle, and it’s a target for theft. You also risk falling victim to scams if you buy from non-reputable sellers. Plus, selling physical gold isn’t always straightforward.

2. Gold ETFs

Gold exchange-traded funds (ETFs) are a popular option. These funds buy and store gold on investors’ behalf, usually in secure vaults. They’re also highly liquid, allowing you to buy and sell shares like any stock.

Fractional investing means you can get started with as little as US$10 on the U.S. stock market. ETFs offer an easy, low-maintenance way to gain exposure to gold.

3. Gold mining stocks

Investing in gold mining companies is a more indirect route, but it comes with some perks. Many of these companies pay dividends, which can appeal to income-focused investors.

Miners can also benefit from gold discoveries, offering more upside than the metal itself. For those seeking the diversification of gold without needing a store of value, this could be a compelling option.

How to buy gold in Australia

One of the easiest ways to invest in gold in Australia is through ASX-listed stocks and ETFs. Follow our step-by-step guide below:

1. Find a stock investing platform

To invest in gold in Australia, you’ll first need to find an investing platform that offers access to the ASX or Wall St. There are several share investing platforms available, of which Stake is one.

2. Fund your account

Next, open an account by completing an application with your personal and financial details. You’ll then need to fund your account with a bank transfer, debit card, or even Apple/Google Pay.

3. Search for the gold asset

There are several different gold stocks and ETFs listed on the ASX and U.S. markets.

The most popular on the ASX is $PMGOLD, a fund managed by the Perth Mint, which has $1.5 billion in assets under management. Another option is $NUGG, managed by VanEck.

Always conduct your own research to ensure that the investment is suited to your risk tolerance and financial goals.

4. Set a market or limit order and buy the shares

You can buy the asset almost instantly at the current price by using a market order during the trading day. Alternatively, enter a limit order to purchase the security when it reaches a specific price. Consider dollar cost averaging to spread out your risk, which involves buying at consistent intervals.

5. Monitor your investment

Once you own the gold asset, monitor its performance over time. Check your portfolio regularly to ensure that your investment remains aligned with your financial goals.

What are the risks of investing in gold?

The biggest risk? Volatility. While gold is seen as a store of value, its price isn’t always stable. Between 1989 and 2019, gold had an annualised volatility of 15.44% – higher than the S&P 500.[5]

Another risk is that gold may not always act as a hedge. Historically, it’s had low correlation with traditional assets, but that relationship can shift during downturns.

Investors buying physical gold also face risks like fraud and theft. Plus, it’s generally harder to sell than exchange-traded products.

What drives the price of gold?

Despite its financial reputation, gold’s largest source of demand is industrial. In 2024, jewellery and technology accounted for 2,320 tonnes of demand, while investment and central banks drove 2,224 tonnes.

So, gold prices respond not only to financial forces like volatility and interest rates, but also to consumer preferences and tech innovation. On the supply side, around 75% comes from mining, with the rest from recycling – meaning mine productivity and recycling efficiency also influence prices.

Source: World Gold Council[2]

Tips to get started investing in gold

Here are a few things to consider before you begin your gold investing journey:

Start small: If you’re new to gold, ease in. Build your position gradually.
Use dollar-cost averaging: This strategy involves regular purchases of a fixed dollar amount, helping smooth out entry prices over time.
Take a long-term view: Gold plays a strategic role in portfolios. Short-term fluctuations are normal – keep your eye on the bigger picture.
Stay informed: Follow credible news and research to better understand gold market movements.
Seek professional advice: For tailored portfolio guidance, consider consulting a financial advisor.

💡Related: Explore the silver mining companies listed on the ASX

Investing in gold FAQs

What are the costs of buying and selling gold?

It depends on how you invest. Platforms may charge a commission on trades involving ETFs or gold stocks. ETFs also carry management fees.

For physical gold, prices at retail stores may not be competitive. Long-term storage can incur extra costs too, particularly for security.

How does gold perform in economic downturns?

Historically, gold has been a reliable hedge. During the 2008 crisis and the 2018 bear market, it delivered positive returns while equities dropped.[5]

In fact, data shows that gold rose an average of 28% from six months before to six months after a recession.[6]

Still, gold can underperform over shorter periods. And holding too much might limit your ability to benefit from a market rebound.

As with any asset, gold works best as part of a balanced financial plan.

Disclaimer

The information contained above does not constitute financial product advice nor a recommendation to invest in any of the securities listed. Past performance is not a reliable indicator of future performance. When you invest, your capital is at risk. You should consider your own investment objectives, financial situation and particular needs. The value of your investments can go down as well as up and you may receive back less than your original investment. As always, do your own research and consider seeking appropriate financial advice before investing.

Any advice provided by Stake is of general nature only and does not take into account your specific circumstances. Trading and volume data from the Stake investing platform is for reference purposes only, the investment choices of others may not be appropriate for your needs and is not a reliable indicator of performance.

$3 brokerage fee only applies to trades up to $30k in value (USD for Wall St trades and AUD for ASX trades). Please refer to hellostake.com/pricing for other fees that are applicable.