Which is the Best Type of Physical Gold to Buy from gold dealers?

Physical gold has incredible store value and that is why historically, even the royals of Egypt and Romans preferred to be buried with their gold. Gold holds a prized position in almost all civilizations and cultures since it was first discovered and is revered and prayed to in many cultures. In fact, among Hindus, there are special festivals when it is considered auspicious to invest in at least 1 gram of gold. During special occasions such as weddings, birthdays, or graduation it is customary to gift someone gold, which is among the most precious metals on the planet. Gold dealers, therefore, keep a special store of bullion gold coins and bars in the store.

Gold price and the markets

Gold price, or spot price, is quoted in US Dollars per troy ounce. It is daily updated as per the rates quoted by the London Bullion Market Association (LBMA), and COMEX in New York. The rates are dependent on the over-the-counter, international bank, and bullion dealers’ transactions.

These live rates can be viewed on the website of all the gold dealers online. Gold price affects the financial markets and hence it is tracked by investors worldwide. Its value constantly fluctuates and when you “buy gold near me”, you pay the spot price at that moment for your purchase. In fact, if at the time of checking out at the store of gold dealers online, if the checkout isn’t completed within 15 minutes of adding the product to the cart, then it may either increase, decrease or remain unchanged depending on the market rate at that moment.

Price variance between physical gold types?

Gold bars generally bring to mind pictures of large gold bricks. These are, however, not for mid-size or small investors, they are generally preferred and bought by large institutional buyers, banks, and high net worth individuals. For instance, the global spot price of gold is largely dependent on the trade of 12.5 kilograms London Good Delivery Bars between financial institutions and large banks. Yet the retail price of gold bullion is set as per the spot price and thus, smaller bullion bars are sold at the spot price plus a premium that is charged for producing, storing, and transporting them. If you are purchasing large bars of 1kg weight or more, then it is viable as their manufacturing cost is lower and the premium charged on them is also lower. However, if you are buying gold wafers or coins of weights ranging from 100 grams to ½ oz the premiums will be approximately the same. Gold wafers and gold coins are manufactured in limited quantity by mints, and they are specially packed in tamper-proof assay packages. Thus, their premium rates go up. Furthermore, when you “buy gold near me”, you may not be purchasing the gold coin or bar from an authorized dealer, but an approved gold dealer for reselling the bullion. Thus, they will charge higher premium rates.

Gold bar or gold coin?

There are two broad categories of physical gold one can invest in, gold bars or gold coins. You can choose to invest in either or both forms of gold based on considerations such as the purpose of buying the gold, period of investment, are you looking for collectible gold coin series, or any specific reasons. Gold bars are the most traded form of physical gold and can weigh anywhere from 1gram to 12.5 kilograms. Globally, manufacturers and mints use similar weight measures for uniformity in trade. So, one troy ounce of gold from any mint will weigh the same. Bars are convenient and cost-effective as they are easier to store. Gold coins generally have an additional premium rate due to the designs or features they have. Furthermore, they are not always of .999 purity. To hold the fine design and shape they have a higher percentage of silver or copper in them.

You can purchase gold bars or gold coins, over the long run both forms offer a phenomenal return and perform the role of wealth conservation and growth well. However, ensure that you purchase gold bullion from a recognized mint such as the U.S. Mint, Royal Canadian Mint, Pamp Suisse, or Perth Mint.

Leave a Comment