How to Invest in Gold: A Comprehensive Guide by Alex Lexington

Updated March 2026 — This guide covers everything you need to know about investing in physical gold: why investors buy it, what products to consider, how pricing works, and exactly how to buy from a trusted dealer. Whether you're purchasing your first gold coin or adding to a six-figure position, this is the resource we wish existed when we started.

Why Invest in Physical Gold?

Gold has served as a store of value for over 5,000 years. Unlike paper currencies, stocks, or bonds, physical gold cannot be printed, diluted, or defaulted on. It exists outside the banking system and carries no counterparty risk — meaning its value doesn't depend on any institution's promise to pay.

Here's why investors allocate to gold:

Inflation protection — Gold has historically preserved purchasing power during periods of rising prices. When the dollar buys less, gold typically buys more. Read: Why Gold Is Considered an Inflation Hedge
Portfolio diversification — Gold moves independently of stocks and bonds, reducing overall portfolio risk. Most financial advisors suggest allocating 5–15% of a portfolio to precious metals. Read: How Much Gold Should You Own?
Safe haven in crisis — During recessions, geopolitical conflicts, banking failures, and market panics, investors consistently move capital into gold. Read: What Makes Gold a Safe Haven Asset?
Currency hedge — When central banks expand the money supply through quantitative easing or when the Federal Reserve cuts interest rates, gold tends to benefit
Generational wealth transfer — Physical gold can be passed down without intermediaries, paperwork, or institutional involvement
No counterparty risk — You own the metal. Not a promise. Not a share. Not a derivative. The metal itself.

Gold Coins vs. Gold Bars vs. Gold Rounds — What's the Difference?

Physical gold comes in three main forms. Each serves a different purpose in an investor's portfolio. Read our full breakdown of bullion types →

Gold Coins (Sovereign Mint)

Government-issued coins like the American Gold Eagle, Canadian Gold Maple Leaf, South African Krugerrand, Austrian Philharmonic, and British Britannia. These carry a face value, are legal tender in their country of origin, and are recognized worldwide.

Best for: First-time buyers, IRA-eligible holdings, maximum liquidity and recognizability

Popular choices at Alex Lexington:

American Gold Eagle — The most widely traded gold coin in the United States. 22-karat (.9167 fine) with 1 full troy ounce of pure gold. Available in 1 oz, 1/2 oz, 1/4 oz, and 1/10 oz
American Gold Buffalo — .9999 fine (24-karat) pure gold. The first pure gold coin produced by the U.S. Mint
Canadian Gold Maple Leaf — .9999 fine with advanced anti-counterfeiting features (DNA mark, radial lines). One of the purest gold coins available
South African Krugerrand — The original modern gold bullion coin (1967). 22-karat with a distinctive copper alloy that gives it a warm tone
Austrian Gold Philharmonic — Europe's most popular gold coin. .9999 fine, denominated in Euros
British Gold Britannia — .9999 fine (since 2013). Issued by the Royal Mint with capital gains tax advantages for UK investors

Gold Bars (Private Mint)

Produced by LBMA-approved refineries like PAMP Suisse, Valcambi, Argor-Heraeus, Perth Mint, Royal Canadian Mint, Asahi, and Credit Suisse. Bars carry lower premiums than coins because production costs are lower — no intricate designs, no government mint fees. Browse gold bars →

Best for: Maximizing gold per dollar, larger investments ($5K+), investors prioritizing weight over collectibility

Popular sizes:

1 oz gold bars — Most popular bar size. PAMP Fortuna, Valcambi, Credit Suisse, Perth Mint
10 oz gold bars — Significant position. Lower per-ounce premium
1 kilo gold bars (32.15 oz) — Institutional size. Lowest premium per ounce
Gram bars (1g, 2.5g, 5g, 10g, 20g, 50g, 100g) — Accessible entry points and gift-friendly sizes

Gold Rounds (Private Mint)

Round-shaped gold pieces produced by private mints. They look like coins but carry no face value and are not legal tender. Premiums fall between coins and bars.

Best for: Investors who want coin-like form factor at closer-to-bar pricing

Fractional Gold

Coins and bars smaller than 1 troy ounce — including 1/2 oz, 1/4 oz, 1/10 oz, and 1/20 oz coins, plus gram-weight bars. Fractional gold carries higher per-ounce premiums but offers flexibility, divisibility, and a lower dollar entry point.

Best for: New investors, dollar-cost averaging, gifts, smaller budgets

Understanding Gold Pricing

What Is the Spot Price?

The spot price is the current market price for one troy ounce of pure gold, determined by global commodity exchanges (COMEX, LBMA) and updated continuously during trading hours. Every gold transaction worldwide references the spot price as its starting point.

What Is a Premium?

The premium is the amount above spot price that you pay for a physical gold product. It covers mining, refining, minting, distribution, and dealer margin. Premiums vary by product type:

Product Type	Typical Premium Over Spot
1 oz Gold Bar (generic)	2–4%
1 oz Gold Coin (Eagle, Maple)	3–5%
Fractional Gold (1/10 oz)	6–10%
Kilo Bar	1–3%

At Alex Lexington, our gold margins run 3–3.5% on standard 1 oz products — among the lowest in the Southeast. We source from the largest precious metals suppliers in the United States, and those wholesale relationships translate directly to better pricing for you.

What Is the Bid-Ask Spread?

The bid-ask spread is the difference between what a dealer will pay you for gold (bid) and what they'll sell it to you for (ask). A tighter spread means more competitive pricing. Our spreads are among the narrowest in the industry because we price off wholesale, not retail.

Understanding Gold Purity

Gold purity is expressed in karats or fineness:

24 karat (.999 or .9999 fine) — Pure gold. Maple Leafs, Buffalos, most bars
22 karat (.9167 fine) — 91.67% gold. American Eagles, Krugerrands. Still contains 1 full troy ounce of pure gold — the alloy adds durability
21.6 karat (.900 fine) — Pre-1933 U.S. gold coins

How to Buy Gold — Step by Step

Step 1: Decide What to Buy

Consider your goals:

Maximum gold per dollar? → 1 oz bars or kilo bars
Maximum liquidity and recognizability? → American Eagles or Canadian Maple Leafs
IRA-eligible? → Eagles, Buffalos, Maple Leafs, and bars meeting minimum purity (.995 gold). Read: Gold IRA Explained
Starting small? → Fractional coins (1/10 oz Eagle) or 1-gram bars
Building a position over time? → Dollar-cost averaging with a set monthly budget

Step 2: Choose Your Dealer

Not all gold dealers are created equal. Look for:

Track record — How long have they been in business? (Alex Lexington's family roots go back to 1977 in New York's Diamond District)
Transparent pricing — Can you see the spot price and the premium separately?
Credentials — BBB accreditation, industry registrations, Google reviews
In-house authentication — Does the dealer have XRF spectrometry or rely on visual inspection?
Buyback policy — Will they buy it back when you're ready to sell?

Step 3: Choose Your Payment Method

Payment method affects both cost and speed:

Wire transfer — No processing fee. Best for orders over $5,000. Read: How Wire Transfers Work for Bullion
ACH bank transfer — No processing fee. 3–5 day clearing period
Credit/debit card — Instant, but 3.5% processing fee applies. Best for smaller orders
Cash — Immediate. Transactions over $10,000 require ID per federal regulations
10% deposit + wire — Lock today's price with a 10% card deposit, wire the remaining 90% within 48 hours. Ideal for large orders where price protection matters

Step 4: Take Delivery

You have options:

Walk out same day — In-stock items available for immediate pickup at our Chamblee location
Insured shipping — Fully insured, signature-required delivery to your door

Selling Gold — How Buyback Works

A good dealer is also a good buyer. At Alex Lexington, we buy back gold at competitive prices based on the current spot rate. Here's how it works:

Bring your metals in — Visit our Chamblee location with your coins, bars, or jewelry
We authenticate — In-house XRF spectrometry testing confirms purity and weight
We quote — Price based on current spot rate minus a fair spread
You get paid — Same-day payment by check, wire, or ACH

Learn more about selling gold to Alex Lexington →

Gold as Part of a Broader Precious Metals Strategy

Most serious investors don't just buy gold — they diversify across metals:

Gold — The anchor. Wealth preservation, inflation hedge, safe haven
Silver — Lower entry point, higher volatility, significant industrial demand. Watch the gold-to-silver ratio for relative value signals
Platinum — 30x rarer than gold with strong automotive demand
Palladium — Critical industrial metal (catalytic converters, electronics, hydrogen fuel cells)

Read: Portfolio Diversification with Precious Metals →

Common Mistakes to Avoid

Paying too much premium — Compare dealer margins. If someone is charging 8–10% over spot for standard bullion, you're overpaying
Buying from unverified sources — Online marketplaces, Craigslist, and flea markets carry significant counterfeit risk. Buy from established, BBB-accredited dealers with in-house authentication
Trying to time the market — Nobody consistently calls the top or bottom. Dollar-cost averaging removes timing anxiety
Ignoring liquidity — Obscure coins and exotic bars can be hard to sell. Stick to globally recognized products (Eagles, Maples, Krugerrands, PAMP bars) for maximum resale flexibility
Confusing numismatic value with bullion value — Collectible coins carry subjective premiums. If your goal is gold exposure, buy bullion-grade products priced close to spot
Not having a buyback plan — Before you buy, know where you'll sell. A dealer who buys back at competitive spreads (like Alex Lexington) protects your exit

Frequently Asked Questions

What is the minimum amount I need to invest in gold?

There is no minimum. A 1-gram gold bar costs around $100–$120 (depending on spot price), and a 1/10 oz American Gold Eagle runs approximately $300–$350. You can start at whatever level is comfortable and build from there.

Is gold taxed in Georgia?

Georgia exempts investment-grade precious metals from sales tax on transactions exceeding $1,500. Below that threshold, sales tax may apply. There is no state capital gains tax in Georgia.

How do I know the gold is real?

At Alex Lexington, every product we sell is sourced from the largest precious metals suppliers in the United States and comes with mint-issued authentication. For items brought to us for sale, we verify authenticity using in-house XRF spectrometry — the same technology used by government mints and refineries.

Should I buy gold ETFs or physical gold?

Gold ETFs (like GLD or IAU) offer market exposure without holding metal. Physical gold offers true ownership with no counterparty risk. Many investors hold both — ETFs for trading and rebalancing, physical gold for long-term wealth preservation. Physical gold is also not subject to exchange closures, broker insolvency, or fund manager decisions.

What is the best gold coin for investment?

The American Gold Eagle is the most popular investment coin in the United States due to its universal recognition, IRA eligibility, and strong buyback market. The Canadian Gold Maple Leaf (.9999 fine) is preferred by investors prioritizing purity. Both are excellent choices.

Can I buy gold for my IRA?

Yes. A self-directed precious metals IRA allows you to hold physical gold in a tax-advantaged retirement account. Eligible products include American Eagles, American Buffalos, Canadian Maple Leafs, and bars meeting minimum fineness requirements (.995 for gold). Read our full Gold IRA guide →

Ready to Get Started?

Visit us: 3335 Chamblee Dunwoody Rd, Chamblee, GA 30341
Call: 404.815.8893
Hours: Monday – Friday, 10:00 AM – 4:00 PM

Browse Gold Coins → | Browse Gold Bars → | View All Gold Products →

Disclosure: This article is published by Alex Lexington for educational purposes only. It is not investment advice, tax advice, or a recommendation to buy or sell any security or commodity. Precious metals carry risk, including the potential loss of principal. Past performance does not guarantee future results. Consult a qualified financial advisor before making investment decisions. Alex Lexington is a precious metals dealer, not a registered investment advisor.

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