1. What’s the difference in a coin, round, and bar? Precious Metals are traded in three forms: bars, coins and rounds.
- Coins come from sovereign mints and carry a face value. They offer a collectable factor that bars and rounds do not. Common weights range from 1/20 oz to 1 oz, though they may be produced up to 1 kilogram (32.15 oz).
- Rounds appear similar to coins, though they have no face value, and can be minted by government or private mints. Common weights range from 1/2 oz up to 5 oz, though smaller and larger may occasionally be minted.
- Bars are produced by private mints, can be easily stored and are an easy way to accumulate more metal for your dollar. Common weights range from 1 oz to 100 oz, though smaller and larger may be minted
2. Gold is more expensive than Silver, why? Gold, like any other commodity, gets its price from the law of supply and demand. Since Gold is a rare commodity, the global supply is limited to what exists and what can be mined and refined, often at great expense. Meanwhile, there are a number of drivers of global demand:
- Gold is used widely in jewelry.
- Gold can be seen as an “alternative currency”.
- Central banks buy Gold to help support their national economies.
- Individuals buy Gold to hold as investments.
3. How is the price of Precious Metals determined? There are two aspects of Precious Metals price that you should know:
- Spot is the current market price of the metal, which is always changing (just like a normal stock changing minute-by-minute throughout the day).
- Premium is the additional cost of a Precious Metals item above the spot price. This includes cost for fabrication, distribution and a minimal dealer fee. Rare coins carry a high premium due to collectible value, while rounds and bars carry the lowest premium since they tend to lack collectability.
When you are looking to buy products strictly for the metal content, it is important to buy your Precious Metals products as close to the current spot price as possible so you can avoid relying on a huge price swing to see a return if you decide to sell your product. When buying numismatic (collectible) products, it is important to understand the ins and outs of the collectibles market to avoid overpaying for an item.
4. Why should I invest in Precious Metals? The value of the dollar (and investments attached to the dollar, like stocks and bonds) has been on the decline. Meanwhile, the value of Precious Metals is not dependent on the dollar, and in fact, generally increases when the value of the dollar decreases. Similarly, Precious Metals can never completely lose their value.
5. Where do I store Precious Metals? There are several options when it comes to storing your investments. You may choose to store your investments at home or in a safe deposit box. APMEX has supplies such as air-tite holders and capsules that will keep your products safe in either location. We also offer Citadel Global Depository Services, a high-security private storage facility for your Gold and Silver products, managed by Brink’s, one of the world’s leading security companies. Read more about the benefits of storing with Citadel, a wholly owned subsidiary of APMEX.
6. Can I sell my products easily when I’m ready? Owning Precious Metals is a long term investment, but when the time comes to liquidate, APMEX is here. You can call us at 800.375.9006 to get a free quote. Learn the simple steps to selling to APMEX.