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Types of Gold Bullion

Types of Gold Bullion

When most people think of gold, they tend to envision a shiny, yellow metal. While this depiction is certainly accurate, what most people do not realize is that there are many different types of gold, especially in terms of ownership alternatives for individuals.

Gold is available in all sorts of shapes and sizes, with products available from sources on virtually every inhabited continent on earth. In this article, we will identify and describe many of the different types of gold available for individuals to own.

Gold bullion includes those products that individuals buy strictly for investment purposes only.

Gold bullion is available in two basic forms: gold bars and gold bullion coins.

Bullion Bars

Gold bars are produced by private refineries and are available in sizes ranging from fractions of an ounce up to the mammoth 400-ounce gold bar.

This means that gold bars are a viable alternative for the smallest individual investors and also big, institutional investors.

A 1/10 ounce gold bar might sell for less than $175 with the price of gold at around $1,240 per ounce. Obviously, this is not the most efficient way to own gold, since the $175 price is well above 1/10 of the price of an ounce of gold. This is due to the fabrication and transport costs associated with producing the bar and getting it to the marketplace.

In contrast, the 400-ounce gold bar is almost certainly the most efficient means of physical gold ownership. It sells for a very small premium over its actual intrinsic value. With gold at $1,240, such a bar might sell for around $500,000.

Even though this is a small amount over the value of the actual gold content, a 400-ounce gold bar is obviously not a convenient way to own gold for the overwhelming majority of people.

Only the very wealthy can afford such a bar and even the very wealthy may find it less than convenient to own such a bar. For one thing, at over 25 pounds, a 400-ounce gold bar is not exactly easy to ship or transport. But, the main problem is that such a bar is not divisible. This means you have to keep or relinquish your entire investment whenever a trading decision arises.

For this reason, smaller sized gold bars are often more practical—and bars do come in a variety of sizes, including 1, 10 and 100 ounces.

The most widely owned type of gold bullion is in the form of gold bullion coins.

Bullion Coins

Gold bullion coins are minted by several national mints in major countries around the globe. Some of the most popular gold bullion coins include:

• The American Eagle Gold Bullion Coin
• The American Buffalo Gold Bullion Coin
• The Gold Canadian Maple Leaf
• The Australian Kangaroo
• The Chinese Panda
• The Austrian Vienna Philharmonic
• The South African Krugerrand

Each of these gold bullion coins is guaranteed by its national mint for weight, content and purity and all are widely traded 24 hours per day, 365 days a year around the world. (It is really true that the gold market never sleeps.)

With the exception of the Gold Buffalo, each of these types of bullion coins are also available in a range of sizes (with variations) ranging from 1/20 ounce to 1 ounce. (The larger the coin, the more efficient the method of ownership due to fabrication costs.)

As mentioned previously, the Gold Buffalo is available only in the 1-ounce size.

For most people, gold bullion coins are the best method for gold ownership. They are secure, highly liquid, convenient and can fit most budgets. However there is another type of gold that offers benefits above beyond what bullion provides. Read more about that on the rare gold coins page or ask for a free gold information kit.

 

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