How to buy gold most cost-effectively? An overview of the advantages and disadvantages of 5 major investment channels

By early 2026, global gold prices hit new highs as international geopolitical conflicts intensify and inflation pressures persist, making gold once again a hot investment. But what’s the most cost-effective way to buy gold? Different channels have vastly different costs and risks. This article summarizes five investment methods: physical gold, gold savings accounts, gold ETFs, gold futures, and gold CFDs, to help you find the best approach for yourself.

Is now a good time to invest in gold?

Gold price fluctuations are influenced by multiple factors, making short-term predictions difficult. However, looking at the broader environment, since 2024, gold prices have indeed experienced a strong rally:

Price trend review:

• 2022-2023 saw intense volatility, fluctuating between $1700 and $2000, mainly due to geopolitical conflicts and Federal Reserve rate hikes
• Starting in 2024, expectations of US rate cuts increased, and global central banks recorded a net purchase of 1,045 tons of gold, pushing prices above $2,700
• Into 2025, gold prices continued rising, reaching over $3,700, setting a new all-time high

Investment suggestions:

Looking for long-term preservation and appreciation? The key is to find the right entry point, not to wait for prices to rise before buying. Suitable for allocating physical gold, gold savings accounts, or gold ETFs to diversify risk and hold steadily.

Want short-term profit from price swings? This involves market risk and requires analytical skills. Gold futures and gold CFDs are suitable for experienced traders aiming to profit from price movements through long and short positions.

How to buy gold most cost-effectively? Cost and risk comparison of investment channels

Here’s a quick comparison table to understand the differences:

Simple judgment:

• Limited funds and want quick entry? Gold CFDs are most cost-effective, starting from just $18 for 0.01 lot
• Want stable, hassle-free investment? Gold savings accounts or ETFs are suitable, with moderate costs and easy trading
• Want to hold real gold? Buy physical gold bars for maximum security, though at higher costs
• Want leverage to amplify gains? Futures and CFDs offer this but also increase risk

How different investors can buy gold most cost-effectively from scratch

1. For those seeking physical gold protection — buy gold bars

Physical gold includes bars, ingots, jewelry, and commemorative coins. Bars are the best choice because jewelry and coins have high manufacturing costs, higher resale fees, and wear and tear discounts.

Pros and cons of physical gold:

• Pros: Low risk, tangible ownership
• Cons: High costs, storage needs, poor liquidity, heavy tax burden (transactions over NT$50,000 must be declared as temporary trade income)
• Suitable for: Long-term preservation, collection, asset allocation

Where to buy the best value gold bars?

Taiwan banks are a good choice, sourcing from UBS AG with guaranteed quality. Minimum purchase is 100 grams, with options for 250g, 500g, and 1kg. Be aware of storage costs.

If you prefer small amounts, jewelry shops are an option, but verify purity (usually priced by weight) and beware of counterfeit or branded illusions.

2. For busy professionals seeking convenience — gold savings accounts

Gold savings accounts (also called “paper gold”) are bank custodial accounts where you hold a certificate rather than physical gold. Many banks offer this, including Bank of Taiwan, CTBC, E.SUN, and Hua Nan.

How they work:

• Buying in TWD: simple but exposes you to exchange rate risk (since international gold prices are in USD)
• Buying in foreign currencies: avoids exchange risk but involves initial currency conversion costs
• Dual-currency accounts: benefit from both TWD and foreign currency exchange rate changes (offered by Bank of Taiwan in 2023)

Costs and taxes:

• Fees are moderate but can add up with frequent trading
• Profits are taxable as property transaction income in the following year; losses can be deducted within three years

Ideal for: Investors with limited funds, small transactions, low trading frequency.

Recommended banks: Bank of Taiwan, E.SUN, E.SUN Bank, and Yuanta.

3. For those wanting effortless investment — gold ETFs

Gold ETFs are “gold index funds” that can be bought via Taiwan or US stock markets. Popular options include Taiwan Gold ETF (00635U), US ETFs like GLD and IAU.

Cost comparison:

• Taiwan ETF: management fee 1.15% annually + transaction fee 0.15% + stamp duty 0.1%
• US GLD: management fee 0.4% + transaction fee 0~0.1% + currency exchange 0.32%
• US IAU: management fee 0.25% + transaction fee 0~0.1% + currency exchange 0.32%

Advantages include high liquidity and low entry barrier, suitable for beginners and retail investors. However, they only allow long positions, not shorting, and trading hours are limited.

Ideal for: Long-term, low-cost, low-frequency investors seeking easy asset allocation.

Where to buy? Through local brokers for Taiwan ETFs or open US brokerage accounts for US ETFs.

4. For active traders seeking efficiency — gold futures

Gold futures are contracts tracking international gold prices, allowing both long and short positions, with 24/7 trading and global linkage.

Features:

• Leverage by margin: high capital efficiency
• No expiration (though rolling over is needed), very low transaction tax (0.0000025‰)
• Large trading volume, high liquidity, hard to manipulate

Risks:

• Leverage amplifies both gains and losses; strict risk management needed
• Rolling over contracts incurs costs
• Positions held at expiry may be forcibly closed

Ideal for: Short-term traders, swing investors, experienced investors.

Where to buy? Taiwan futures exchange trading hours are shorter; overseas brokers operate nearly 24/7 with larger volumes.

5. For beginners with low entry barriers — gold CFDs

Gold CFDs track spot gold prices without actual ownership or expiry, offering flexibility.

Advantages:

• Minimum as low as $18 for 0.01 lot
• Long and short positions, T+0 trading, 24/7
• No minimum contract size, flexible leverage (1X to 100X)
• Lowest fees, mainly from spreads and overnight fees

Differences from futures:

• No minimum contract size, no expiry
• No physical delivery
• No futures transaction tax
• Lower capital requirements

Tax note: Overseas gold trading profits exceeding NT$1 million annually are subject to minimum tax rules.

Ideal for: Short-term, swing trading, limited capital investors.

Risks: Leverage magnifies both gains and losses; beginners should start with 1X leverage and gain experience before increasing.

How to choose a CFD platform?

The global CFD market is diverse; select platforms with proper regulation. Recommended platforms include IG Markets, Plus500, eToro, and Mitrade, all regulated by authorities like ASIC, CIMA, or FSC.

Mitrade is popular for its user-friendly interface, competitive trading conditions, support for TWD deposits/withdrawals, and 24-hour Chinese customer service. Beginners can start with demo accounts to practice.

Why is gold investment so popular?

Key reasons:

◆ Gold as a traditional safe-haven asset — During inflation or market turmoil, investors flock to gold. During the Russia-Ukraine conflict, gold surged to $2,069. Recent geopolitical tensions have driven prices to new highs again.

◆ Preferred asset for institutional investors — Top global investment firms recommend allocating over 10% of portfolios to gold. Despite volatility, gold provides a sense of security and helps hedge against market uncertainty and financial crises.

◆ Global liquidity and market depth — Gold markets have a long history, large trading volume, and quickly reflect systemic events like wars or economic crises, leading to rapid price swings.

◆ Hedge against dollar depreciation and inflation — Gold tends to move inversely to the US dollar and inflation over the long term, rising when the dollar weakens or inflation heats up.

Two main strategies for investing in gold:

One is long-term holding for preservation, suitable for physical gold or savings accounts, with higher costs but lower risk.

The other is short-term trading for profit, using futures or CFDs to react quickly to market changes, requiring market analysis skills and risk awareness.

Regardless of the approach, the key to cost-effective gold investment is: choose the right tools, understand risks, and strictly manage your funds—avoid blindly following trends.