Understanding the Price of Gold
Trading gold online on a forex platform or gold trading platform is an exciting experience. In recent times the internet has made it much easier to trade gold thanks to the flourishing trade. One important thing before setting out to trade gold online is to get a good grip on gold pricing. This begins with the gold fix.
What is the gold fix?
The gold fix, or London gold fixing is the process of setting the price of gold on the London market by the members of the London Gold Pool for the London bullion market. The London bullion market association is made of entities that own gold like the major international banks and gold dealers. It is supervised by the Bank of England.
The gold fix is also considered the accepted rate that is used as the standard for pricing gold throughout the world. The gold fix is done twice a day over the phone at 10.30 and 15.00 GMT by five London bullion market members in a more or less auction like setting. This is called the London gold fixing. The chair quotes a gold price followed by the members decide whether they can buy or sell at that price. When there are more buyers than sellers or vice versa, another price is quoted by the chair. Once there’s a balance, the gold fix is finalized and broadcasted online and via newspapers.
You can trade gold by interacting with another gold trader, which is done over the counter or OTC. The OTC is a computerized off floor securities exchange that you use for trading gold. While you can see the price of one seller at the store, there is no clue about the pricing offered by other stores.
The gold fix is useful as it suggests an indicative fair price for gold. However, there can be hassles with timing, obstacles to entry and clash of interest. Thus, it is important to be aware of all these factors while using the gold fix while trading gold online.
How to Trade Gold?
Take advantage of the daily changes in the price of gold. Start trading gold today by opening a trading account with easyMarkets and get up to $2000 bonus*. As an industry first, they have also launched a unique deal cancellation tool as a way to manage your risk on any bad trades. By selecting dealCancellation on the trading platform whenever you make a trade, you can cancel your losing trade within 60 minutes and get your money back. *Terms and Conditions Apply
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