Why Smart Money Is Ditching Paper Gold for the Real Thing

As market volatility heats up in 2025, many investors are looking for ways to shield their wealth from inflation, political uncertainty, and the growing instability in global markets. Gold has always been a go-to hedge in times like these, but not all gold investments are created equal.

In fact, a growing number of ultra-wealthy investors and institutional players are moving away from paper-based gold like ETFs, futures, and mining stocks and going back to the basics of buying physical gold and silver.

Here's what you need to know about the different ways to invest in gold, and why owning the physical metal carries distinct advantages.

The 3 Most Common Paper Gold Investments

Before we dig into the benefits of physical metals, it's important to understand the alternatives and their limitations.

1. Gold ETFs (Exchange-Traded Funds)

Gold ETFs are essentially stocks that track the price of gold. They’re easy to buy and sell on the stock market and allow you to gain exposure to gold without ever holding it. But there’s a catch:

• You don't actually own gold.
  
• The fund could halt redemptions in a crisis.
  
• You're at the mercy of financial institutions and counterparty risk.
  

According to SmartAsset, ETFs track gold prices and are suitable for short-term trading, but aren't necessarily ideal for long-term wealth protection, especially in uncertain times.

2. Gold Futures

These are contracts that bet on the future price of gold. While they're popular with experienced traders, they're also highly volatile, complex, and may not achieve the level of stability that physical precious metals offer. Futures can be profitable, but they also expose you to significant losses if the market moves the wrong way.

3. Gold Mining Stocks

Instead of gold itself, these are stocks in companies that mine gold. Your returns are tied to both the price of gold and the company’s performance. That means:

• You're still exposed to the stock market, not just gold.
  
• Poor management, rising labor costs, or supply issues can crush your returns.
  
• These investments are often more volatile than gold itself.
  

Why the "Ultra Wealthy" Is Buying Physical Gold (and Silver)

While ETFs and mining stocks may seem like convenient ways to invest, investors looking to help shield their wealth are turning their attention to tangible metals, coins, and bars you can actually hold.

Here's why:

True Protection During Crisis

Physical gold isn't just a price tracker, it's a real asset that exists outside the financial system. That's why, according to CNBC, ultra-wealthy investors are moving their gold offshore, particularly to private vaults in places like Singapore. They're doing this to shield their wealth from economic shocks, government overreach, and geopolitical risks.

Complete Control

When you own gold through an ETF, your investment depends on fund managers, custodians, and clearing houses doing their jobs correctly. With physical gold, there's no middleman. You own it outright. It's yours, period.

Long-Term Value That Lasts

Gold has held its purchasing power for thousands of years. Unlike paper assets, it can't be printed, devalued, or defaulted on. That's why central banks are also buying record amounts of physical gold. It's a way to hedge against currency devaluation and global debt.

Silver: The Underestimated Opportunity

Gold isn't the only metal catching the eye of savvy investors. Silver is increasingly seen as a win-win: a hedge against inflation and a play on the future of technology. From solar panels to electric vehicles, silver demand is growing, and physical supply is tightening.

Yet, silver remains dramatically undervalued compared to gold. That makes it a compelling buy for investors looking to get into precious metals at a lower cost with what could be higher potential upside.

Final Thoughts: If It's Not in Your Hand, You Don't Own It

At Lear Capital, we believe physical gold and silver can offer peace of mind in today's uncertain world. The ultra-wealthy know this, which is why they’re increasingly pulling their assets out of paper markets and locking them in physical vaults.

If you want to protect your wealth, hedge against inflation, and own an asset that has stood the test of time, physical metals could be a great way to diversify.Want to get started? Call one of our precious metals specialists today at 855-271-2873 to learn how you can add physical gold or silver to your portfolio or retirement account.