Gold Ingots
A few facts about Gold Ingots
A gold ingots, or gold bars, are pieces of gold bullion that are produced by a recognized gold bar manufacturer to a specific weight, size and purity. Bullion grade gold ingots are as solid an investment as gold coins. In fact, in some cases you’ll get a much better deal because gold ingots are generally sold at a lower premium more than the present value with the fine gold content. Put simply, manufacturing expenses are lower when making a gold ingot. Gold bullion ingots may be the most popular investment options for medium to big precious metals investors (while silver ingots is the best choice for small investors and collectors).
A gold ingot is simply a cast or minted block of gold. While most gold bullion ingots are are made rectangular in shape, gold bullion bars issued in foreign countries often comes in other shapes such as square and even boat-shaped. Gold ingots are usually sold at a low premium over value of their gold bullion content.
The name of the issuer, weight and purity are marked on the surface of each gold ingot. Larger gold ingots like 100-oz ingots are often imprinted with their own unique serial numbers. If somebody desires to sell you a gold bar that does not consist of all of that information, walk away.
While the bulk of gold ingot bars are consumed by jewelry manufacturers and other industrial applications, their low premium also makes them attractive to gold investors looking to take up a small position in the precious metal.
Investing in Gold Ingots or Gold Bars
Regular gold ingots or gold bars are the most cost effective and best value form of gold bullion investment.
But why the gold bullion ingots are so popular? The main reason is the lowest possible premium over spot gold price. The premium for the gold bars, especially large bars, are much smaller than the premium for gold bullion coins like American Gold Eagles or Canadian Gold Maple Leafs.
Investing advantages:
- Gold is well known as an inflation hedge.
- The minimum fineness requirements for gold bullion ingots (.995) means that the gold will not tarnish.
- Investing in gold bullion ingots is cheap in terms of broker costs – less expensive than investing in stocks and bonds or gold ETFs.
- Investors can buy or sell gold ingots at all hours, as the market for physical gold is global.
- As an asset diversifier, gold can lower the overall risk of an investment portfolio.
- Unlike other assets, gold ingots value can increase even as the dollar’s value decreases.
Where to buy gold bullion ingots
You can buy gold ingots at the American Precious Metals Exchange (APMEX) or on the Nucleo Exchange at Bullion Direct. Many people sell gold ingots at online auctions like Ebay. Sometimes these bullion ingots have a final bid that is well below spot gold price
Types of Gold Ingots or Gold Bars
Depending on the used manufacturing process, gold ingots can be classified into two types: cast gold ingots and minted gold ingots.
Cast Gold bullion ingots
Most cast gold ingots are produced by pouring hot gold into a ingot mould with the appropriate dimensions. After cooling, the melted gold will hardened into blocks of solid gold ingot bars.
Minted Gold ingots
To produce minted gold bullion ingots, a cast gold ingot is first rolled into a uniform thickness and then a die is used to cut it to the required dimensions.
Purities of gold ingots
Pure gold is extremely soft and easily damaged. In fact, 100% pure gold is so soft that it can be molded by hand. To increase its hardness, gold is mixed with other metals to form an alloy.
9999 Fineness
Purity: 9999 parts gold in 10000 parts or 99.99%
999 Fineness
Purity: 999 parts gold in 1000 parts or 99.9%
995 Fineness
Purity: 995 parts gold in 1000 parts or 99.5%
The purity is important as it is used to calculate the amount of fine gold contained in the gold ingots. The purity, or fineness, of the gold ingot is normally declared in parts per 100, 1000 or 10000.
Major gold bullion refiners
The most popular major bullion refiners are Johnson Matthey, Perth Mint, Union Bank of Switzerland, Credit Suisse, Bank Lui, Harringtons, Deak International and the Canadian Royal Mint.
Weights and Sizes of Gold bullion Ingots
Gold ingot bars are made various in sizes and weights, ranging from 1 gram to as large as the 400-oz brick sized London Good Delivery gold ingots.
Gold ingots are generally considered large if it’s heavier than 1000g. Put it in another way, if it looks like a brick, it’s a large gold ingot. If you can hold it in the palm of your hand, it’s a small gold ingot.
The most common units used to indicate the weight of the gold content are usually grams, kilograms or ounces. Please note that when the weight is marked in troy ounces (troy ounce is not the ounce normally used to weigh food).
- One troy ounce = 31.1034768 grams.
- One kilogram = 1000 grams = 32.15074656 troy ounces.
- One tola = 11.6638038 grams.
- One tael = 50 grams.
- TT (Ten Tola) = 117 grams (3.75 oz)
Tola is a traditional Indian measure for the weight of gold and prevalent to this day. Many international gold manufacturers sell tola ingots of 999.96 gold purity.
400-ounce or 12.5 kg gold bar or ingot
These are the movie gold bars or ingots. Typically this is the size used by central banks along with other very big investors in gold. They are not well suited to individual buyers. Besides their extremely high cost, you also lose the advantage of liquidity that you simply get with one-ounce coins. In other words, if you need a thousand dollars or two in money, you are able to quickly and effortlessly sell a couple of gold coins. Not so with a 400-ounce gold ingot.
Kilobars or Kilogold bars
These are two names for the same factor – a one-kilo rectangular block of pure gold. These are very popular among investors and gold owners who have much more money to spend and don’t want every thing tied up in coins. They’re also well-liked amongst jewellers the globe over, who buy the bars and then use the gold to fabricate jewelry.
Other sizes of gold bars
Based on the dealer you buy from, and also the part with the world you are living in, you are able to discover a variety of other gold ingot sizes, such as 10-ounces, 100 grams and 1-ounce or much less.
In other words, there are gold ingots to fit every spending budget from much less than a single ounce up to 400 ounces.
Great perspective on a type of gold investment that doesn’t get much attention. It’s true ingots are reserved for more high dollar investors who likely already have an emergency stash. I’d say that’s one disadvantage of ingots, you can’t trade them for anything – they’re too big. For those just starting out, it’s best to buy coins since they can easily be swapped for things like food, gas, etc. etc.