Is Buying Gold Bars a Good Investment?
Buying gold bars is a great investment for many reasons. The first reason is that gold bars are easier to store. You have to take proper care to store any precious metals in the most appropriate fashion so that they are safe and clean.
If you were to purchase one gold bar versus 100 gold coins it would take up more room for the coins compared to the bar even if the total weight for both were the same. The reason for this is that gold coins have individual packaging that makes them take up more room than a gold bar. If you were to purchase lots of gold bars they could easily be stacked in the quintessential fashion that is often televised.
In terms of price, they are also better suited than coins for investment purposes simply because it cost less money to produce a gold bar than it does to produce gold coins of the same value. Gold bars can be cast which is a simpler process that requires less time compared to minting individual coins.
These are there for the closest gold investment product you will find to the spot price on the market. The premium you pay is typically going to be less than you would pay for coins or rounds. These are eligible for precious metals IRA’s, and simply put, are the best long-term gold investments you can make.
Common Weights and Shapes of Gold Bars
The measurements for gold can be a little confusing. The weight of gold is measured in what are called troy ounces. A single troy ounce is equivalent to roughly 31g. The purity or fineness of gold is measured in percentage, which is why you will see 99.9% (or .999) purity for things like gold bars and gold coins. For gold jewelry you probably see it displayed in terms of karats.
If you were to purchase a one troy ounce gold coin, it would be approximately 32.70 mm in diameter, 2.87 mm thick, and it would weigh approximately 1.09 Troy Oz.
Now, how do you know if your gold is pure? There are a couple of ways that you can test the purity of your gold at home. The first is called the sink test. Gold is actually heavy and it will sink so if you fill up a container of water and you put your gold in there it should sink. Fake gold, however, will float.
Another test is the magnet test. Real gold is not magnetic so if you put a magnet over your gold bar or coin or round it should not react. If it reacts and is attracted to the magnet then the gold is not pure.
Types of Gold Bars
You might hear a great deal about whether bars are minted ingot or cast. But what does this really mean? A cast gold bar simply means that the gold was melted and then poured into a cast otherwise known as a mold. In these cases, the cast will already contain the hallmark for the refiner stamped into it as well as the purity and the weight.
Minted gold bars are produced similarly to minted coins. The casting process still takes place. But after that, the bar is fabricated with a striking process whereby the machine strikes at the bar to stamp it with a design the same way they would strike at a coin. Because of this extra effort, there is a higher cost.
Additionally, there are limits on the sizes available. Minted gold bars are most commonly manufactured in 1 oz sizes which do make them more expensive compared to larger bars. For this reason, many investors will purchase 1 oz coins instead of 1 oz minted gold bars if possible.
There are some situations where gold coins are not going to cost more than gold bars. One example is the 1kg gold Kookaburra coin produced by the Perth Mint. This is a large format gold coin which is minted so it does require more work compared to a cast bar of the same size.
Popular Brands and Refineries
Gold bullion bars are typically stamped with the exact purity levels and weight. If they are more refined, figuratively not literally, they might have the serial number printed on them for additional security which will slight you more. If you are purchasing gold bullion bars you can purchase sizes between one-half gram and one kilogram or higher. 1 oz gold bars are the most commonly traded gold bars.
The most popular gold bars today include the Republic Metals Corporation one ounce gold bar, the sunshine minting one-ounce gold bar, and the PAMP Suisse 1 oz gold bar. That said, no matter which form you choose, rest assured that you will still be holding onto a form of authentic physical currency that has lasted throughout history.
Gold bars differ in prices from different brands or refineries due to a few factors including the premiums being charged and the extra designs in some bars that include serial numbers for added security.
How Much Does a Gold Bar Cost?
The price for gold fluctuates on a daily basis. This price moves independently of other money markets including the stock market. There are different things that impact the price of gold on a daily basis such as national and federal elections, ships within the stock market, geopolitical volatility, and the threat of a recession. Now all of these factors will increase the overall price for precious metals which will, in turn, increase the price of gold bullion, or decrease it if the overall price for precious metals has decreased.
Gold bullion coins come in many sizes which allow investors to diversify not just their investment plans but the gold coins that they have. In fact, you do not have to settle for just the gold coin.
There are gold bullion bars and rounds. Whether you are adding gold to your investments to hedge the market, as the main part of your portfolio, or simply to add to your collection, it is important to understand and appreciate the value of each purchase you make.
Buying Gold Bars From Metals.com
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