Gold bullion is gold produced for retail sale without a monetary value in a currency (for example, the US American Eagle Gold Coin has a $50 US currency value). The Royal Canadian Mint, Credit Suisse, PAMP Suisse and Perth Mint are the largest distributors of gold bars around the world and many prefer buying gold bars rather than gold coins. This preference of buying gold bars rather than gold coins is because the premiums are lower compared to Government-issued gold coins. This article will cover my preferences on how to buy gold bullion.
Common sizes for gold bars: 1 gram gold bar (0.03215 troy ounces) – 2.5 gram gold bar – 5 gram gold bar – 10 gram gold bar – 20 gram gold bar – 100 gram gold bar – (3.215 troy ounces) – 1 oz gold bar (31.1034768 grams) – 10 oz gold bar – kilo gold bar (32.15 troy ounces) – 100 troy ounce – 400 troy ounce
How to Buy Gold Bars
I would highly recommend buying gold bars from Royal Canadian Mint, Credit Suisse, PAMP Suisse and Perth Mint as they are the most well known mints in the world. It is very important to remember at some point you will be selling your gold. You don’t want someone questioning the authenticity of your gold when you go to sell. I don’t know a single dealer who would pass up on buying gold bars minted by the above-mentioned mints. I am NOT saying other Mints’ gold bars have something wrong with them or are flawed; I would just advise buying from the most well-known Mints. There are many other companies producing gold bars. They are honest and you may not have any trouble selling the bars. If you do deviate from the above listed Mints be sure it’s a widely recognized name.
I wouldn’t recommend deviating from these lists:
The smaller the gold bar you purchase, the more money over spot (premium) you’re going to pay. 1 gram gold bars tend to carry a high premium over spot and I would not recommend buying many of these bars. If you’re looking for “barter gold” as many people have stated, 1 gram bars are great to have, but don’t buy 10 oz. worth of these bars. You’ll be spending way to much money over spot. The reason is that the cost for a 1 gram gold bar is higher is due to its production cost. Refiners are not ripping you off charging a high price for no reason; it is much more costly to produce these bars. I know the Canadian Royal Mint makes a 1/20th oz gold coin. I have heard from people in the industry they have a 30%+ reject rate when making these. Bars this small are difficult to produce and the fabrication costs will rise. It’s also simple math: you can make a 1 oz. gold bar 31.10 grams or produce 31 – 1 gram gold bars. Which do you think is going to cost more money to produce? You also have to seal 31 bars instead of just one. All the costs add up to a higher price you’re paying for the fractional gold bars and coin.
The 1 oz. gold bar is the most widely produced of all. They are quite easy to buy and sell and are easily transportable. I would also recommend only buying gold bars packaged in a sealed assay card. I truly believe Perth Mint has one of the best in the industry using CertiCard (link: http://www.certilinesecurity.com/certicards.htm). If the seal on a Perth Mint gold bar is broken it can’t be fixed (I have confirmed this myself). So you will know the bar has remained sealed since it left the mint.
I have not heard of anyone making fake gold bars and passing them off to the public, and the fear of this ocurring is low. If you purchase from the local or widely known online dealers the odds of this happening are very close to zero. Remember: it’s important to buy and sell from trusted dealers, and if it seems too good to be true, well, it probably is.
I personally would recommend spending a bit more money and buying a gold coin produced by a government mint as they can easily be tested for size and weight. The chances of a counterfeit gold coin passing simple testing are 0%. No one can make a counterfeit gold coin that perfectly fits weight and size. But if you have your heart set on buying gold bars please consider the advice above, and happy investing!