Wall Street Metals – Gold and Silver Investing
Other Gold Price FAQ
If a gold coin has a face value, shouldn’t the coin be worth more money?
There are several gold bullion coins that have a face value. That is to say that they are considered good, legal tender in their respective country and could be used to make purchases just like cash. The fact is, however, that these coins are not often used to make purchases. They are worth more for their gold content than their face value.
Have you ever seen someone pay for items at the grocery store with a $20 Saint-Gaudens gold coin? Probably not. These coins and others that carry a legal tender status derive their value primarily from their bullion content and collectability or scarcity in the market.
If I am a new physical gold investor, what are some products I may want to look at buying if I am simply trying to acquire as many ounces of gold as possible?
If one is just trying to acquire as much gold as possible, both gold bars and standard gold bullion coins are a viable option. If one is simply looking to purchase gold for the lowest price possible, gold bars will often be the most cost-efficient way to buy gold bullion. Bars carry lower premiums than coins because they have no face value, are not backed by government mints, are rarely considered collectables, and most gold bars are easier to make than gold coins.
For example, today a 1 oz American Gold Eagle coin may be bought from a dealer for $1355. That same dealer is also offering a 1 oz OPM gold bar for $1323. That’s about a $30 difference per ounce of gold bullion! Gold bars can also be purchased in fractional sizes such as 1 gram, 2 gram, 5 gram, 20 gram, 50 gram and more. The fractional sizes, however, will typically carry larger premiums than a standard 1 ounce or 1-kilo bar due to higher manufacturing costs associated with producing smaller bullion items.
If gold is priced at $1320 per ounce, why do I see gold coins selling for hundreds or even thousands of dollars over that price? Does the dealer make that much money?
Gold products, especially gold coins, are priced based on gold content and their collectability. The gold content is pretty straightforward. The collectability premium, however, is another animal. Gold coins with the same gold content may have wildly different market values based on such things as when or where they were minted, how many coins of that particular type were minted, what condition the coin is in, and more.
Just because a dealer is selling that coin for hundreds over the spot price does not necessarily mean that the dealer is making hundreds of dollars on the coin. The dealer likely paid several hundred dollars over the gold spot price for the coin, as well, and is now looking to sell it with his or her profit margin attached.
If the price of gold is constantly changing, how do I lock in a purchase price if I am buying gold?
Dealers have procedures for locking at a specific price on gold products based on current price levels. These procedures may vary from dealer to dealer. If one is looking to buy gold and lock in a price, one method is for the buyer to lock that price in once he or she reaches their checkout page when making an online purchase.
At that time, the investor will typically have a specified amount of time to complete their purchase and lock their price in. The amount of time given may be fairly short, however, such as ten minutes. Dealers do this to try and protect themselves from rapidly changing prices.
What is the gold/silver ratio?
The gold/silver ratio represents the price relationship between gold and silver. Some investors will analyze historical gold/silver ratios to see if the current ratio means gold or silver are under or overpriced relative to each other.
Aren’t I better off buying from a local coin shop?
Gold and silver bullion are very competitive markets these days. Online dealers may offer buyers some advantages over local coin shops. One big potential advantage is lower prices. An online dealer does not have the overhead a brick-and-mortar coin store does. Because an online dealer typically has lower overhead, they can offer products at lower premiums and still make a profit. In addition, online dealers will often have vastly larger selections than a local coin store.
Do dealers just charge a fixed amount over the spot price?
Yes and no. Dealers may charge a fixed profit markup on certain products and they may have varying charges on other products. A simple gold bar, for example, maybe sold by a dealer for $20 over the spot gold price, while a graded Double Eagle coin may sell for a premium at the dealer’s discretion based on condition, scarcity, and other market factors.
Does the price of gold go up if the stock market goes down?
The price of gold often exhibits a negative correlation to stocks. That is to say that yes, gold and equities usually move in opposite directions; however, there are also times gold and stocks may both move in the same direction. Many consider gold to have little correlation to stocks and bonds and therefore feel it can potentially be a wise investment to add to one’s portfolio.
Is the gold market manipulated?
This has been a topic of great debate for some time. One can easily find plenty of information online about this topic and draw his or her own conclusions.
What is the gold “fixing?”
Gold fixing refers to the price set by the London Gold Fixing Company twice a weekday at 10:30 AM and 3:00 PM GMT. This price is determined by certain LBMA market makers, including representatives from Scotiabank, Deutsche Bank, and HSBC.
Will I pay tax when I buy physical gold?
Certain states place sales taxes on physical precious metals, including gold. When buying online, Internet retailers will only charge you sales tax if you are an in-state customer, and if the state does indeed tax precious metals. Fortunately, due to our location, Wall Street Metals does not have to collect sales tax, although consumers may be liable to pay local use tax.
What is an Assay?
An assay is a certificate or encasing that guarantees the purity and authenticity of the accompanying gold piece. Assays typically include a serial number, which will match the serial number imprinted on the bar. Assays will also include a signature by the official assayer of the piece.
How many grams are in an ounce of gold?
Gold is always measured by the troy ounce, which is equivalent to about 31.103 grams. This standard of measurement was created in France during medieval times and was later adopted by the United States in 1828 for standard coinage. A troy ounce is slightly heavier than a “regular” ounce, which weighs only 28 grams.
How many ounces are in a kilogram of gold?
There are 32.151 troy ounces in one kilogram of gold.
What are the different types of gold bullion?
Gold bullion is available in the form of coins, rounds, and bars. Gold coins are different from the other two options in that they are produced only by government mints and carry a face value in their country of origin. Many countries throughout the world produce their own gold coins containing a wide range of designs and sizes. Gold bars and rounds are produced by private mints and are usually found in a wider selection of sizes than that of coins.
Where can I buy physical gold & can I buy gold near spot price?
Right here on our website, of course. Wall Street Metals offers a wide variety of Golds coins and Bullion at the lowest prices in the industry.
Please note that Wall Street Metals is the only major retailer in the industry currently offering FREE shipping on all orders to the United States. This allows our customers to keep their transaction fees on gold and silver bullion purchases at an absolute minimum.
Can I put gold in my IRA?
Many of our gold bullion products are eligible for a gold IRA. Depending on whether you can allocate gold into your personal IRA account will depend upon the custodian you use. If your current IRA custodian does not offer gold IRA services you can transfer your IRA to a custodian who does offer gold IRA services. Please contact us at firstname.lastname@example.org for further info.