Whether you’re looking to buy gold bullion coins or apex silver bars, understanding spot prices is a must in the industry. For the novice, spot pricing charts can be a bit overwhelming and sometimes confusing. Lucky for you, you’ve found the expert at Boston Bullion. This article will uncover some of the most common misconceptions about spot prices.
What spot price means
The starting point to understanding the mystery behind spot pricing is understanding the basic definition. To put it simply, the spot price is the price at which a commodity can be transacted at the exact moment. So instead of thinking what the commodity may be worth in the future, think about what it’s worth at this very second in time.
With gold and silver, spot price refers to the price per ounce. However, the quality of the metals must meet specific requirements to be considered for spot pricing. To add to any confusion, it’s common to find coin dealers quoting different spot prices. However, we’ll get into this one a bit later.
What future exchange means
The second market in pricing gold and silver is future exchanges. Future market pricing refers to a contract of a sale or trade price set for a future date. This market’s major influencer is the US COMEX market. Several commodities have future contracts listed on them for the public to view. The future price and the spot price work hand in hand for traders that look at the relative cost of borrowing commodities to sell in the future and the potential gains and losses that may occur.
How Bullion dealers set their pricing
When it comes to buying gold bullion coins or other commodities, coin dealers are empowered to set their own pricing. Below are a few of the factors that are taken into consideration when doing so:
- Minting premium
- Investor demand
- Wholesale deal being made between individuals
If you’re looking to buy gold bullion coins but are confused by the varying pricing, it’s time to contact Boston Bullion. As one of the most trusted Boston coin dealer, our team will provide you with honest and fair pricing. However, we always recommend shopping around first, so you’re not just taking our word for it! Available by appointment, contact Ken today at (781) 710-8419.