What You Should Know About Golds Spot Price And How It Affects You}

Submitted by: John Roz

Lets assume youre a seasoned investor. Youre not too timid but youre not reckless either, maybe a little on the conservative side you want your money to prosper but you dont want to take aggressive risks. Youve experienced the turbulence of the market and you worry that your investments may be unprotected.

What should you do?

Most experts and analysts will agree that diversification is key. But a mix of stocks and bonds and mutual funds arent going to protect you against a falling stock market. For that youll need a hedge and if youve done your investing research, youve discovered that one of the best hedges for your money is precious metals, especially gold and silver.

So, youve considered giving gold and silver a try but you have some questions about pricing. What do the different designations mean?

What Is a Spot Price?

Gold and silvers selling price is based on what is called the spot price. This price is a reflection of all the fundamental and technical aspects that are influencing the market at that very moment. This price should include all mining, processing, and other associated costs. Youll notice to that this price differs from the ask and bid prices: an ask price is related to the coin or bars selling price and the bid price has to do with a commoditys buyback price. The spot price, then, is the spread between the bid and ask prices set in the market you are dealing in for that region by the commodities trade of the given metal, for that trading day.

What Gold and Silver Will Cost You

In buying gold and silver dont ever expect to pay the spot price: the price you pay for any precious metal will always be a little above that. Conversely, when you sell the price will always be a little below. The reason for this should be obvious: this is how dealers do business. This spread allows dealers in precious metals to meet their overhead costs office rent, wages, website expenses, insurance, etc. In order to stay in business and cover costs, dealers must charge their customers a small premium over spot.

How to Get the Best Price for Your Gold

Always make sure to keep your metals in top condition. If they become tarnished or otherwise dirty for some reason, your metal will typically sell for less than items in pristine condition. This is regardless of the fact that whether clean or dirty, both contain the same amount of metal.

Trading in volume will get you the best price. As with many other commodities, the more metal youre buying or selling, the better the price youll get. There are some dealers that fix their selling prices that are the same regardless of volume. Typically, many retailers will give you breaks when you are buying in volume. If a company offers you free shipping and insurance on your order purchased online, all the better. Buying in volume will allow you to stay as close to the spot price as possible.

Buying Precious Metals In Your Retirement Accounts

First and foremost, you want to do business with a company that not only understands the buying and selling of precious metals but also IRA transfers and rollover of 401(k) retirement plans. Also, expect that the company should be experts on the various IRS rules. You want to make sure youre getting all of the benefits that owning a Gold IRA offers.

Learn More

While easy, investing in gold can be a little complicated. To help you learn what you need to know to help you through the crucial decisions in your investing, a new FREE mini-course was created. This course will not only help new investors find answers to many of their questions, it will also provide them with the vital information theyll need so theyll know what to ask prospective dealers. The course is entitled The Secret to Successful Gold Investing and its now available as a download absolutely free. In this course you will find information that could help save you thousands of dollars and avoid many of the typical rookie mistakes.

With gold at current market prices, there may be no better time to invest than now.

About the Author: John Roz is a Managing Director at a boutique precious metals wholesaler in Los Angeles. He has worked in the industry for over 15 years. He writes about precious metals investing and retirement accounts.In our volatile and unpredictable economy you don’t want to leave your nest egg exposed. To learn more about protecting – and growing – your retirement savings by investing in precious metals, visit

RCBullion.com

or call (213) 465-4835Download FREE course Here.

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