Get ‘yer gold bars!
Gold Bars for Sale! Demand is high and doesn’t appear to be waning anytime soon. Get ‘em now while you can, friends.
In our last article we discussed where to buy gold. In this article we’ll talk about how to buy gold – specifically gold bars. We’ll discuss what to look for when shopping, some of the terminology related to your gold bar purchase (so you don’t sound like a total beginner), and more.
The Gold Bar
When we think of gold bars, we usually think of large bricks of gold stacked into pyramids suitable for “heisting.” That form of gold exists, but due to the relatively high price of gold, most of us are not going to be investing in (nor heisting, I hope) large pyramids of gold bricks. Let this not dissuade you from your pursuit of this metal of kings (and wanna’ be kings such as yourself). You’ll be happy to know that gold bars come in a variety of sizes; from the large bricks to 100 oz. bricks; from 10 ounce gold bars to the most popular 1 ounce gold bars. If you’re a bit short on cash, gold bars can come in even smaller sizes – 1/2 ounce, 1/4 ounce, 1/10 ounce – although they probably really couldn’t be considered “bars” at this size. But wait, we can go even smaller. For you metric system types, we can even get some measured in grams. Some popular sizes run from 20 grams all the way down to 1 gram gold bars for sale. Needless to say, if you’re going to be making purchases of gram-size or fractions of an ounce, you’ll definitely need to get your calculator out. You’ll also want to make sure you find a safe place for these smaller bits of gold because they’re easily misplaced…! Also note that you’ll find that premiums are higher on these smaller sizes of solid gold bars for sale. Just like with anything, dealers want to sell as much as they can and they’ll tend to charge less for the more they can sell. Make sure you check with your dealer to see if they’ll offer discounts for larger purchases.
At this point, I think it’s important to highlight a few items that you may have run across and found yourself with questions. The first bit is the “Troy Ounce.” We need to note the difference between a troy ounce and the more common avoirdupois ounce. Here in the US we use the avoirdupois ounce for all our usual weighing: our bodies, our food, etc. Gold and silver and other precious metals are typically sold by the troy ounce. A troy ounce contains 2.75 more grams than a standard, avoirdupois ounce. Here are some handy measurements
- 1 troy ounce = 31.1034768 grams or 480 grains
- 1 ounce = 28.3495231 grams or 437.5 grains
- One troy ounce is 31.1034768 grams, or 0.0311034768 kilograms.
- A troy ounce is equivalent to 480 grains. A grain is 0.06479891 grams.
Also know that you’ll see a variance of purity on gold bars. Some will say .999 purity while others will say .9999. Obviously that extra ten thousandth means that the bar “more pure,” but the amount is so minuscule that it really makes no difference.
How to Buy Gold Bars
Once you’ve decided what size of gold bar(s) you’re going to purchase and you’ve done your calculations, and you’ve checked our your LCS (Local Coin Shop) and you’ve browsed through several online purveyors, and you’ve researched the sellers and found a highly reputable one, the purchase is easy. If buying from your LCS make sure you clarify how they’ll accept payment; many won’t accept personal checks and many will not take credit cards. If purchasing from an online dealer, check out their ordering and payment procedures carefully. Like with the LCS, find out what types of payments they will accept. We’ve gone over this a bit in the Where to Buy Gold article. Just remember, when you are making a purchase and the dealer quotes you a price, you and the dealer are obligated to purchase/sell at that price, regardless of whether it goes higher or lower after you get off the phone.
Speaking of price, you’re going to run into three different prices when investing in physical gold. First off, you’ve got the “spot price.” This is the price set by the Comex, the Commodities Exchange here in the US. There’s a lot of funny business that revolves around the Comex. We’ll discuss some of this in other articles. When you’re looking at a chart of gold, know that the price that is being tracked is the spot price. The two other prices are the “bid” and the “ask.” The bid is the price at which a dealer will purchase gold from you. The ask is the price you pay him for his wares. The dollar amount between the bid and the ask is called the “spread,” and that’s where the dealer makes his money.
Why We Buy Gold
In closing, I just want to remind you that it’s important to know where to buy and how to buy gold bullion bars, but I think it’s most important to know and remember why we buy gold. If you need a refresher, head over to Should I Buy Gold Now?. Thanks for reading!