The spot price of gold, silver or other metals is indicative. Various coins, ingots and other ingot-derived products will be sold for varying quantities above the spot price depending on a number of factors, such as product, minting, relative scarcity, year and dealer profit margin. Gold and silver in the form of ingots are usually minted in 1-ounce coins or small ingots ranging from 1 ounce to 10 oz. It is an advanced process for casting, minting and certifying ingot products with high quality and precision.
Everything from design work to manual stamp engraving must be calculated based on cost. Therefore, it is normal for a 1-ounce coin to cost more than 1 ounce of real metal. The “spot price” simply refers to the price at which the metal or raw material can be processed and delivered at this time. Several exchange-traded funds, or ETFs, invest exclusively in the yellow metal and their stock prices are linked to the price of gold.
Many gold ETFs are backed by physical gold stored in vaults, but some rely instead on futures contracts to track the price of gold. I'll share the best type of gold to buy, as well as the first way to eliminate that price differential. Gold and silver “cartridges” with skulls or bayonets, the treasure of ancient shipwrecks and nostalgic gold coins “before 1933” are extremely expensive ways to buy gold. And, since inflation has soared to 40-year highs, gold is also being promoted as a hedge to stay ahead of rising prices.
The spot price is the price at which someone can buy gold certificates or futures on the commodity exchange. Obviously, the fewer “intermediaries” involved in the production and sale of particular metals, the better the price the retail buyer can obtain in relation to spot prices. Since the spot price of gold is several times higher than that of silver, it is also normal for the premium of a 1-ounce silver coin to represent a percentage ratio greater than that of a 1-ounce gold coin. However, the spot price does not account for any other costs associated with buying or selling metals.
In general, but not always, dealers seek to sell above the spot price and buy at or below the spot price. On the sales side, that means the amount a dealer will pay you in cash (or, if you're lucky, a lower price that's equal to or higher than cash). Spot gold and silver spot prices are derived from trading the most active futures contract in the first month. With any liquid investment, you get a good price by minimizing the spread between the buying and selling prices of gold.
Of course, the price of gold will affect the buying and selling price, so if the spot price of gold rises on that day, you'll earn money.