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Precious Metals FAQ

Your questions about gold, silver, platinum, and palladium answered — from understanding spot prices and premiums to buying physical metals and analyzing the market.

About Precious Metals

The precious metals market is one of the oldest and most liquid asset classes in the world. Gold, silver, platinum, and palladium are traded globally with combined daily volumes in the tens of billions of dollars. Unlike stocks or bonds, precious metals are tangible assets that carry no counterparty risk when held physically.

  • Gold is most commonly used as a portfolio diversifier and hedge against inflation and economic uncertainty
  • Silver has significant industrial demand (electronics, solar panels, medical devices) alongside its monetary role
  • Platinum and palladium are primarily driven by automotive catalytic converter demand
  • Key concepts to understand: spot price vs dealer premium, troy ounces vs standard ounces, and the role of COMEX and LBMA in price discovery

Understanding Metal Prices

The spot price is the current market price for one troy ounce (31.1035 grams) of a metal for immediate delivery. It is determined by continuous trading on global exchanges, primarily COMEX and the LBMA.

  • When buying physical metals, you pay spot price plus a premium covering minting, shipping, insurance, and dealer margin
  • Gold premiums are typically 1-5% over spot; silver premiums are higher as a percentage due to lower per-ounce value
  • Key price drivers: real interest rates, US dollar strength, central bank policy, and investor risk appetite
  • COMEX futures positioning, ETF flows, and physical demand reports provide additional insight into supply-demand dynamics

Quick Links

Gold PriceSilver PriceUnderstanding Gold PricesMelt Calculator

Frequently Asked Questions

What is the spot price of gold?
The spot price of gold is the current market price for one troy ounce of pure gold for immediate delivery. It is determined by trading on global futures exchanges, primarily COMEX and the LBMA. The spot price changes continuously during market hours and serves as the baseline from which dealers set their buy and sell prices.
How do I buy physical gold?
You can buy physical gold from authorized dealers, online bullion retailers, some banks, and government mints. The most common forms are gold bars, sovereign coins (American Gold Eagle, Canadian Maple Leaf), and privately minted rounds. Always compare premiums, verify dealer reputation, and consider secure storage options before purchasing.
What is the gold-silver ratio?
The gold-silver ratio represents how many ounces of silver it takes to buy one ounce of gold at current prices. Historically, the ratio has ranged from about 15:1 in ancient times to over 120:1 during 2020. Many investors use the ratio to determine which metal offers better relative value at any given time.
Is platinum more valuable than gold?
Historically, platinum traded at a premium to gold for most of the 20th century. However, since 2015, gold has consistently traded above platinum due to declining diesel vehicle production, strong gold investment demand, and record central bank gold purchases. The relationship could change if industrial demand for platinum recovers.