Market Performance - The gold market in 2025 has shown remarkable performance, with spot gold prices rising from approximately $2,624 per ounce at the beginning of the year to $4,381 per ounce, marking a significant increase of 66.96%, the strongest annual performance since 1979 [1] - However, by late October, gold prices experienced a notable correction, dropping to $4,080.87 per ounce, a decline of over 6%, and closing at $4,111.56 per ounce on October 24 [1] Investment Options - Investors are faced with the decision of whether to invest in physical gold or financial gold products, each having distinct characteristics [3] Liquidity - Physical gold has relatively weak liquidity, making it cumbersome to liquidate in urgent financial situations, while financial products like gold ETFs can be traded easily during market hours, akin to stocks [4][5] Holding Costs - The premium for bank gold bars typically ranges from 5% to 10%, while branded gold jewelry can have premiums as high as 30% to 80%. In contrast, the holding costs for gold ETFs are significantly lower, generally at a fraction of a percent [6][7] Hedging Effectiveness - Physical gold offers strong hedging capabilities during extreme economic crises, especially in the context of heightened geopolitical risks in 2025, while financial products may perform well under normal market conditions but have limitations during systemic risks [8][9] Tax Treatment - Purchasing physical gold includes a 13% value-added tax, with personal sales exempt from income tax, although frequent trading may be classified as business activity and incur taxes. Financial products like gold ETFs require a stamp duty of 0.1% on trades, with personal capital gains currently exempt from income tax [10][11] Inheritance Advantages - Physical gold is often viewed as a "family heirloom," carrying emotional and cultural significance, whereas the transfer of financial products involves more complex account inheritance processes [12][13] Conclusion - There is no absolute superiority between physical gold and financial gold products; the choice depends on individual needs. For those prioritizing extreme risk hedging or sentimental value, physical gold may be more suitable, while those valuing liquidity, holding costs, and trading convenience might prefer gold ETFs [13]