Summary: You can buy gold with PayPal by using the app as a deposit and linking it to a reputable third-party brokerage with the necessary tools for monitoring your gold investment, like eToro.
Intermediate Traders and Investors
Can you buy gold with PayPal?
Gold’s traditional role in trading has been as a ‘hedge’, which means that when the value of stock market assets in your trading portfolio drops, the value of gold is expected to rise. The same goes for currencies – when the public trust in currencies, especially USD, falls, investors most often turn to gold instead. In short, traders tend to buy gold to stabilize the total value of their investments, but they also buy gold to profit from speculating on market prices.
PayPal isn’t a tool for investing in gold, so you can’t exchange your PayPal funds for gold directly on the platform. However, you can still use the deposit from PayPal with a third-party brokerage service to buy gold.
This way, you get to skip the laborious and time-consuming part of physically obtaining a piece of gold. Instead, you partake in what is called a contract for difference (CFD), in which case you don’t actually own the gold but profit on the price difference of the asset.
There are other ways of buying gold, for example, directly from gold dealers, but many of these are impractical, either due to requiring you to possess the gold in physical form or by lacking sophisticated options to quickly respond to the changing market. With PayPal, cash transfers are instantly processed, giving you greater maneuverability and more generous response time.
Using PayPal with an investment service like eToro is the best way to buy gold with PayPal. Simply create an eToro account and connect your PayPal with it. Once that’s done, you are ready to buy gold.
How to buy gold with PayPal?
Rather than paying for gold directly, we’ll stick with the preferred alternative: buy gold with PayPal via a third-party investment service like eToro.
Nearly 30 million users rely on eToro to exchange 60+ various types of assets, from cryptocurrency to precious metals like gold. Buying gold with eToro requires only a desktop or a hand-held device and takes a single button click. Sure, the market is the factor that dictates the price of your gold, but on this platform, you get more tools to react to the market conditions, like stop-loss, leverage, and take profit.
For example, stop-loss orders can save you in cases of sudden and dramatic shifts in prices. And with a community as large as eToro’s, you’ll never run out of profitable trading approaches to learn or copy from.
So, how do you buy gold with PayPal using an exchange service such as eToro? It’s easy. First, register an account on eToro and link it to your PayPal deposit. Have the amount of funds that you need on PayPal? If yes, let’s proceed to step-by-step instructions.
How to buy gold with PayPal: Step-by-Step
Go through the following steps, and you’ll buy gold with PayPal in no time:
- Step 1: Create an eToro account and go through verification (personal or company);
- Step 2: Type in the amount of cash that you wish to transfer to your eToro account;
- Step 3: Connect your PayPal to deposit your fiat currency;
- Step 4: Head to “Commodities,” select gold from the list, and specify the desired amount.
Intermediate Traders and Investors
PayPal (NASDAQ: PYPL) is a hugely popular online payment service that allows users to quickly send and receive money. In fact, millions of users use PayPal to handle their online transactions in both business and everyday life. PayPal has a flexible and versatile system that is supported by more than 200 countries and regions around the world. Finally, it is simple enough that all you need to have to send or receive money via PayPal is a linked bank account, connected credit/debit card, or prepaid card.
Gold price today
Gold prices have a long history, with value influenced by economic and political events, inflation, currency fluctuations, and supply and demand. Under the gold standard system in the early 20th century, the price was fixed at $20.67 per ounce. In 1971, President Nixon ended the convertibility of the US dollar to gold, leading to volatile prices, and a surge in gold prices in the late 1970s and early 1980s.
From the mid-1980s to the early 2000s, gold prices remained stable, trading between $250 and $500 per ounce. Gold prices reached an all-time high of over $1,900 per ounce in 2011 and have remained as high in recent years, hovering between $1,000 and $2,000 per ounce, exceeding the $2000-mark as of May 2023.
Ways to invest in gold
If we exclude the obvious “buy a piece of gold and hold it in a safe” method, there are three main ways that you can invest in gold right now. These are:
- Contracts for difference (CFDs)
- Exchange-traded funds (ETFs)
- Gold-related equities
We mentioned CFDs before, and they indeed are the simplest and usually most cost-effective way of investing in gold. As mentioned above, these contracts do not give you actual ownership of the gold; you simply track the price difference using instruments. With eToro, you can open both short positions and long positions. After you complete the order, you can monitor the condition of your investment as you please.
Another way is to become an owner of an exchange-traded fund (ETF). Ideal for holding a position in gold, these don’t require you to pay fees for storing the asset in banks or store the gold at your home and expose it to the risk of theft.
Finally, you can own a portfolio of equities themselves gold-related. For example, shares in gold mining companies increase in value together with the price of gold on the market, despite the gold being in the ground at the given moment. It’s worth noting that the correlation between these two can vary, though.
Is gold a good investment?
You can look at gold from the perspective of trading and investment in two ways.
Gold’s traditional role, as we said, is one of a ‘hedge,’ as its price tends to be inversely proportional to your usual investment assets. In other words, if the value of your trading assets falls, you will lose less since the value of gold will most likely experience a surge.
Gold is effective ‘counterbalance’ to currency in a similar way. For example, if the worth of USD hits a plunge, the price of gold will skyrocket. All fiat currencies have central banks that can decide to print more money, which causes the value of those currencies to drop. Gold is a good measure that resists inflation since it is a finite resource, unlike centralized and regulated fiat currencies.
Alternatively, with gold being sought-after due to its stabilizing financial properties, it has become a speculative asset on its own. With many people turning to hedging, some speculative traders try to predict the panic moment and capitalize on gold changing in value due to a change in demand.
Common mistakes to avoid when investing in gold
It’s easy to make mistakes when investing, especially if you’re new to the trade. However, some common mistakes get repeated frequently and by many. Give your best not to do any of these:
- Fall prey to high leverage. CFDs allow you to use leverage, which means you can raise the scale of your risk-profit ratio. On leverage of x20, the position size will be 20 times the amount you entered. Winning that bet can bring in huge profits once the price experiences movement, but losing that bet can be catastrophic.
- Little or no research on gold before trading. This one should be obvious. Never trade in things you know little about – it is a sure way of losing money.
- Thinking short-term. Trading gold is not a short-term project. Gold is a stable market commodity that requires establishing a durable approach.
- Failing to diversify. Gold’s traditional role is of a ‘hedge’. It is used best in combination with diverse portfolios.
- Starting with a low budget. Gold typically requires greater cash balances than more common equities and forex.
Pros and cons of investing in gold
- The best hedge against any type of financial doomsday scenario
- The ultimate safeguard of your financial property
- Excellent portfolio diversifier
- Hedge against inflation
- Preserves its value over time
- A very liquid asset despite the limited supply
- Increases in fiat currency values (typically USD) decrease the value of gold
- Very ineffective as a passive investment
- Gold ETFs tend to have higher fees
- A paper gold investment still depends on financial system stability
- Extremely little to no yield
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
FAQs about how to buy gold with PayPal:
Can I buy gold with PayPal?
You can buy Gold with PayPal together with a third-party brokerage or exchange service.
How to buy gold with PayPal?
You can buy gold with PayPal by giving access to PayPal’s funds to a brokerage such as eToro.
Where to buy gold with PayPal?
Users can buy gold with PayPal on eToro’s gold commodity dashboard.
Is buying gold with PayPal safe?
Yes, buying gold with PayPal is safe as long as you rely on credible dealers, brokerages, or exchange services.
How to buy gold?
You can buy gold with PayPal using a commodity exchange service like eToro.
Is gold a good investment?
If you perform the necessary research and play on gold’s advantages as an investment commodity, gold can be quite a good investment.