The 5 Mistakes You Must Avoid When Investing in Physical Gold and Silver
Investing in precious metals such as gold and silver may seem simple, but there are key mistakes that can affect both the liquidity and profitability of your investment. Based on experience, we summarize the five mistakes you should avoid—and the golden rules for buying and selling the right way.
1️⃣ Buying rare or niche pieces
Highly exclusive pieces may look appealing, but their main drawback is low liquidity: finding a buyer is difficult and, if you do, you’ll likely face a high buyback margin.
In addition, lesser-known pieces usually carry a higher risk of counterfeiting and require additional verification measures.
Professional recommendation:
Opt for internationally recognized coins with advanced security features such as Philharmonics, Maple Leafs, Britannias, Krugerrands, or American Eagles, in both gold and silver.
If a coin can’t be sold in at least two different shops within 48 hours, don’t buy it.
2️⃣ Ignoring the real market price
Buying without knowing the current price of the metal can lead you to overpay or choose pieces that are hard to resell.
Comparing prices across different dealers and second-hand platforms is essential.
Advice:
Check at least three different dealers and review the second-hand market (for example, Wallapop in Spain).
Add your favorite pieces to your watchlist and monitor price alerts to understand the real market value before purchasing.
3️⃣ Not balancing sizes and fractions
Many investors make the mistake of buying only large pieces—or only micro-fractions.
Large coins usually have lower premiums over spot price but are harder to sell to individuals.
Smaller fractions offer greater liquidity, but with higher premiums.
Professional rule:
• Gold: allocate around 40% to
one-ounce coins with low premiums and 60% to smaller
fractions (1/4 oz, 1/2 oz, 1/10 oz).
• Silver: keep 90% of your
collection in recognizable one-ounce coins and only 10% in
special or fractional pieces.
4️⃣ Not having an exit plan
Your final profitability depends on your ability to resell.
Before buying, design a strategy that includes:
- Where to sell: shops, marketplaces, or private buyers.
- Buyback prices: compare terms from different dealers.
- Applicable taxes: for instance, in Spain the Impuesto de Transmisiones Patrimoniales (ITP) may affect your transactions.
Essential tip: always keep your purchase invoices.
They make resale easier, serve as proof for insurance, and protect you from audits or disputes.
5️⃣ Neglecting authenticity, preservation, and security
Verifying your pieces is crucial to avoid fraud.
Use scales, calipers, and magnetic or density tests to confirm authenticity.
For preservation, avoid touching coins with your hands:
store them in capsules, tubes, or airtight cases, and maintain controlled temperature and humidity.
Security is the third pillar: use safes, bank deposit boxes, or specialized home insurance policies.
AurumStack Tip 💬
A well-preserved metal keeps its aesthetic and market value. Every fingerprint or scratch reduces its appeal to professional resellers.
🧭 Conclusion
Avoiding these five mistakes will help you build a solid, liquid, and profitable portfolio of precious metals from day one.
Choose recognizable pieces, compare prices, balance sizes, maintain a clear exit plan, and safeguard authenticity and security.
This way, you’ll protect your investment from the most common risks and maximize your chances of long-term success.
Have you ever made any of these mistakes? Do you prefer investing in large ounces or smaller fractions? Share your experience in the comments and keep learning with AurumStack Academy.