What Is Gold Bullion?

By Corry Cummings

Bullion is any measurement of a pure metal, so simply put, it is a unit of pure gold. When minted by national mints from around the world and is certified for the purity of its gold content. It can come in the form of bars or coins. Those who know about gold, know this is one of the best ways for those looking to invest in precious metals. Because of the purity and stability of gold holding its value, one of the surest investments out there today.

What is a Gold Bullion Bar?

A gold bar is a piece of pure gold that has been formed into a rectangular shape. The price of a bar will be determined by the weight of the bar. Smaller investments can be purchased in one-gram or one-ounce bars, while larger investments are made using ten-ounce and one hundred-ounce bars. They are even available in sizes of four hundred ounces, which are usually reserved for very large investments performed by banks or large corporations. So whatever the size or amount of gold you are looking for, there are options for you.

What is a Gold Bullion Coin?

Gold bullion coins are units of currency that are made of gold. There is a distinct difference between gold coins meant for circulation and gold bullion coins meant for investment purposes. Circulated gold coins, like the Sacagawea Golden Dollar Coin, are made from alloys such as copper and brass. However, the American Gold Eagle Coin is considered gold bullion because it contains 91.67% pure gold. Even though the gold percentage might be higher, the rarity of the coin could actually make its value even greater than other coins with gold percentage.

Gold bullion coins are often minted by national governments such as the United States, Canada and South Africa in one-ounce, 1/2 ounce, 1/4 ounce, 1/10 ounce and 1/20 ounce sizes. Traditionally, the coins are printed with a design and are marked with a unit of tender, such as the $50 American Gold Eagle Coin. While the coin has a face value of $50, it contains one troy ounce of gold, which is worth roughly $1,500.

Gold bullion coins are also unique because there is a collectable aspect to consider. They can have a higher markup as they are often catered towards coin collectors instead of precious metal investors. They also have larger production costs that can lead to a higher premium. So be sure to do your research and figure out what kind of coin you are investing in and or are buying.

What is Gold Bullion Investing?

Gold bullion is a smart investment because gold is a popular commodity and is used in a number of electronic goods, which makes it in high demand. When purchasing for investment purposes, you should be aware that you will often have to pay markup due to the cost of production, shipping and storage as well as the profit margin of the dealer. While markup is always a factor, you should invest smart by trying to avoid high premiums whenever possible.

One way to avoid high premiums is to buy in larger quantities. For both coins and bars, the markup is considerably higher for bullion with fewer troy ounces, so the bigger the bullion, the smaller the markup. Another way to avoid a large markup is to invest in bars instead of coins, which generally have high premiums. Knowing what is gold bullion is the first step towards becoming a gold investor and planning for your financial future. Many experts predict the precious metals industry to be the safest bet for the upcoming years with our economy as unstable as it is.

For more information about gold bullion check out our website at gold-bullion.org

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