THE RISKS OF 

BUYING GOLD, 

SILVER & PLATINUM

GOLD AND OTHER PRECIOUS METALS, 

SUCH AS SILVER AND PLATINUM, MAY 

NOT BE AS SAFE AS SOME PROMOTERS 

MAKE THEM OUT TO BE. 

Claims sometimes suggest that gold or 

silver are safe havens that can protect you 

against economic or political uncertainty. 

While precious metals can offer additional 

diversification to an investment portfolio, they 

are subject to the same pressures of supply 

and demand as other commodities.

CONTACT US

Email: consumers@cftc.gov 

Phone: 866-366-2382

TTY: 202-418-5514 

U.S. Commodity Futures

Trading Commission

Three Lafayette Centre

1155 21st Street, NW

Washington, DC 20581

U.S. COMMODITY FUTURES TRADING COMMISSION
WAYS TO INVEST

Here are three common ways you can invest in gold or 

other precious metals, and all of them involve some risk:

Futures contracts. When you speculate in the futures 

markets, you have the ability to purchase contracts on 

margin. This means you can control a large amount of 

metal at a fraction of its value. Leverage can amplify 

returns and risk. Small price swings in either direction 

could mean significant gains, or you could lose 

significantly more than you initially invested.

Precious metals securities. These can range from 

shares in publicly traded mining companies to exchange 

traded funds (ETFs) that buy physical metal or trade 

metal futures contracts. Like other securities, metals 

securities and ETFs are subject to trading commissions, 

fees, and market risk.

Physical metal. You can buy bullion or coins from a bank 

or other dealer. You will pay the current or “spot” price 

plus a markup or “premium.” You’ll want to compare 

premiums from multiple sellers to make sure you’re 

getting the best value. For you to make a profit, the spot 

price needs to increase enough to cover the premium 

plus any other costs associated with selling the metal. 

Also, consider the cost of storage over time. If you 

keep the metal at home, it may not be covered by your 

homeowners insurance. If you store it with a bank or 

other facility, you will likely pay fees. 

BEWARE OF OTHER TYPES

OF OFFERS

Be cautious of offers to buy bullion or coins and store 

the metal in secured facilities rather than deliver it to you. 

If the seller is not registered with the CFTC and the sale 

involves financing or buying the metal on margin, it could 

be operating illegally. In most cases, it is against the law 

for a non-registered entity to sell any commodity “over 

the counter” using credit or margin, unless the buyer 

receives delivery within 28 days of the purchase.

U.S. COMMODITY FUTURES TRADING COMMISSION CFTC.GOV

The CFTC has brought enforcement actions against several 

companies that operated illegally. In some cases, the CFTC 

charged the companies with fraud for selling gold and other 

precious metals that didn’t exist. These frauds also charged 

victims for: 

• Storing the nonexistent metal

• Insurance premiums

• Shipping fees

• Interest on loans

SIGNS THAT A SALES PITCH 

MAY BE FRAUDULENT

• You are promised guaranteed returns.

• You are called out of the blue or receive an offer via email.

• You are told only precious metals can hold their value in 

times of crisis or political upheaval.

• You are told that gold or silver or other metals have the 

potential to reach their “highest values” in a long time. 

• The salesperson claims to be a “metals dealer” or 

“merchant” to sound more legitimate.

• You are told precious metals transactions are 

unregulated.

• The sales agreement does not say where the physical 

metal is located, or claims that it will be stored in an 

overseas storage facility or bank.

• The pitch claims you can make a lot of money with little 

risk by purchasing through a “financing agreement.”

WHAT TO DO

BEFORE YOU INVEST

• Run a background check at SmartCheck.gov 

to verify the company and person selling the 

investment are registered. 

• Learn how the investment makes money, how it can 

lose money, and verify claims using independent, 

unbiased sources.

• Get the opinions of friends, family members and 

professionals you trust. 

• Consider if the product meets your financial needs 

and risk tolerance.

IF YOU SUSPECT FRAUD...

Report it to the CFTC: 

www.cftc.gov/ConsumerProtection