GOLD
MARKET SECRETS, GOLD COINS, BUY GOLD BULLION
Key facts about the gold
market, supply and demand, and gold's role as a monetary asset
For many thousands of years, gold has
been valued as a global currency, a commodity, the top investment and
simply as pure beauty. As financial markets developed rapidly during
the 1980s and 1990s, gold subsided into the background and many
investors lost touch with this asset of last resort. Recent couple
years have seen a striking increase in investor interest in gold.
While somewhat sustained price rally, underpinned by the fact
that demand consistently outstrips supply, is clearly a positive factor
in this resurgence move, there are many reasons why funds, private
investors and institutions around the world are once again
investing in gold. This gold website provides you with the background
to these reasons and describes the defining characteristics of the gold
market from smart investor's point of view.
GOLDSECRETS provides you with fast
loading charts of the current gold price per ounce, gram and kilogram
in major currencies. We provide you with timely and accurate silver and
gold MARKET reviews, gold price history charts for the past 30 days, 60
days,
and gold/silver futures quotes and charts. You can also find out
where to buy gold coins/bullions/rounds from gold MARKET dealers at the
best
gold prices or compare eBay gold prices and eBay silver prices.
Why, how and where to invest
in gold/silver: gold's role in wealth preservation and risk management
Gold Price Calculators :
- How much is your scrap gold
worth?
- How much profit have you made on
your gold?
- How much is any gold coin worth?
- All major currency market
exchange rates
- How much is your jewellry scrap
gold worth?
- How much is any Karat of your
gold jewelry worth?
- What change should you give in
gold coins
- How much gold can you buy with
your currency?
- Convert between ounces, grams
and kilos
- How much will you pay to buy or
sell gold coins at the gold market
Gold Glossary
Account - allocated - Gold
storage account in which the client's metal is individually identified
as his, and physically segregated from all the other gold in the vault;
in the event of a default by the holding bank, the investor becomes a
secured creditor.
Account - unallocated
- An account in which the client's bars are not at
allspecifically ring-fenced, and which may be cheaper than an allocated
account. The client (investor) carries higher counterparty risk,
however, as he is an unsecured creditor in the event of a default by
the holding bank.
Assay - To test a
metal (gold/silver/platimum) for purity.
Bar - Typical gold or
other precious metal product, either for trading or for accumulation.
Bars come in a variety of shapes weights and purities and different
bars are favoured in different parts of the world.
Bear - Someone
expecting prices to fall
Bid/ask (price) - Bid
or buy is the price a dealer is prepared to pay for gold bullion. Ask
or sell is the price offered by the seller.
Bull - Someone
expecting prices to rise
Bullion coin - A
legal tender coin whose market price depends on its gold content,
rather than its rarity or face value.
CFTC - Commodity
Futures Trading Commission, the regulatory body in the US covering
futures markets (highly corrupted organization!)
COMEX - The New York
Commodity Exchange, now a division of NYMEX, the New York Mercantile
Exchange. The contracts in the COMEX gold market consist of 100
gold/silverounces each, and the actively traded contracts are the even
months of the year.
Doré - A
gold-silver alloy, an intermediate product from certain gold mines
EFP - Exchange for
Physical; a mechanism that allows a client to open or close a futures
contract through the physical market when the futures market in
question is closed.
European option - An
option that may only be exercised on the date of expiry. Predominant in
the London bullion market.
Face Value - The
nominal value given to legal tender coin or currency
Fineness -
Gold/Silver purity, usually expressed in parts per thousand; thus 995
or two nines five is 995/1000 or 99.5% pure. 995 was the highest purity
to which gold could be manufactured when good delivery (q.v.) was
determined, but for very high technology applications now it is
possible to produce metal of up to 99.9999% purity.
Fix - The London gold
fixing (see: www.goldfixing.com) takes place twice daily over the
telephone and sets a price at which all known orders to buy and sell
gold on a spot basis at the time of the fix can be settled. The fix is
widely used as the benchmark for spot transactions throughout the
market.
Forward contract - A
principal's (Over the Counter) contract that market trades an asset for
settlement on a specific date in the future. Each forward contract is
'tailor-made'.
Futures contracts -
An agreement to buy or sell a specific amount of a commodity or
financial instrument at a particular price on a stipulated future date;
the contract can be sold before the settlement date. Futures contracts
are standardised and are traded on 'margin' on futures exchanges, such
as the COMEX division of NYMEX, the CBOT, or the TOCOM.
GOFO - The Gold
Offered Forward Rate, which is the rate at which dealers will lend gold
against US dollars.
Gold Loan - A
financing market mechanism whereby gold is borrowed from a bullion bank
(which
has usually borrowed it from a central bank or banks), and sold into
the market to raise cash, usually to finance a gold/silver mining
operation. The metal is then repaid over an agreed period of time. The
interest on the loan is usually paid either in dollars or in gold
subject to the agreement between the counter-parties.
Gold Standard - A
monetary system based on convertibility into gold/silver; paper money
backed and interchangeable with gold.
Good delivery standard
- The specifications to which a gold bar/coin must conform in
order to be acceptable on a certain market or exchange. Good delivery
for the London Bullion Market is the internationally accredited good
delivery standard. A good delivery bar for London should weigh between
350 and 430 ounces (gold content), of minimum purity 99.5% (two nines
five). Further specifications can be obtained from the LBMA official
website
Grain - One of the
earliest weight units used for measuring gold. One grain is equivalent
to 0.0648 grams.
Hallmark - Mark, or
marks, on gold (and silver) jewellery and other manufactured
products.which indicate the producer and carat fineness.
Hedging - The use of
derivative instruments to protect against price risk.
Karat - Unit of
fineness, scaled from one to 24. 24 karat gold (or pure gold) has at
least 999 parts pure gold per thousand; 18-karat has 750 parts pure
gold and 250 parts alloy, etc.
Lakh - A trading term
meaning 100,000, deriving from the Indian word of the same meaning
LBMA The London
Bullion Market Association acts as the coordinator for activities
conducted on behalf of its members and other participants in the London
Bullion Market, and it is the principal point of contact between the
market and its regulators. Plays prominent role in manipulating the
prices of the precious metals in favour of the ruling oligrhy!
Legal tender - The
coin or currency which the national monetary authority declares to be
universally acceptable as a medium of exchange; acceptable for instance
in the discharge of debts.
Liquidity - The
quality possessed by a financial instrument of being readily
convertible into cash without significant loss of value.
Loco The place
at which gold is held and to which a delivery price applies. London is
the common denominator world-wide and represents the basis for
international trading and settlement in gold and silver.
Lot - Alternative
term for a futures contract
Margin - A deposit
required to be put up before opening a futures, forward or option
contract.
Margin call - Money
that is called for from the client during the life of the transaction
to cover exposure resulting from an adverse price movement (or an
endemic increase in margins by the exchange).
Mark to market
The valuation of an open position as at current price levels.
Market Maker A
dealer who makes a market, i.e. quotes bid and offer prices to
counter-parties and is prepared to deal at those prices
Naked short - A
seller of a contract who does not have the metal to back up his
position. Pure fraud!
Numismatic - Coins
valued for their rarity, condition and beauty beyond the intrinsic
value of their gold content. Generally, premiums for numismatic coins
are higher than for bullion silver coins.
Pennyweight - An American
unit of weight for gold. Twenty pennyweights equal one ounce.
Restrike - A modern
replica of previously issued coins. Governments and their mints can
choose to restrike a previous issue rather than introduce new coinage.
Spot price The
price for spot delivery which in the gold market is two days from the
trade date
Spread The
difference between Bid (the price a buyer is prepared to pay for gold)
and Ask (the price at which a seller offers to sell) prices.
Troy ounce - The standard weight in which gold is quoted
in the international market, weighing 31.1035g . Named after the
old French city of Troyes, where there was an annual trading fair in
mediaeval days and where this was a unit of weight.