Understanding the term Gold Bullion and the Various Forms of Gold

Understanding the term Gold Bullion and the Various Forms of Gold

Gold bullion is basically gold for gold’s sake. When you buy gold for investment purposes, you don’t buy it in the form of jewelry, or even gold coins. You buy gold bullion, which usually takes form in gold bars, and gold bars come in many different shapes and sizes.

 

When people think of the term gold bullion, they envision gold bars, stacked high in pallets at Ft. Knox. This is often true, but it also takes form in many other shapes. The definition of gold bullion is a defined amount of gold that is refined and stamped with its weight. The weight is obviously one of the most important aspects of gold, but its fineness is also a crucial component. It is these gold bars that make up the majority of the worlds gold reserves, and this gold is held by international governments, and their central banks.

 

Safe Keeping your Gold Bars

When investors buy stock, or equities, they often hold the stock in “safekeeping”, which means they don’t actually hold the physical stock certificates. With gold, an investor has the same option. However, when they actually want to possess their held commodity, their gold is sent to them in gold bullion form. It is the safest and most efficient form in which to hold onto gold, and for those investors with other needs for their gold, outside of investment, bullion can be easily converted into working forms used in electronics, manufacturing, and other business or manufacturing uses. However, depending on the amount of gold held, it can often be difficult to quickly liquidate gold held in bullion form. A large chunk of gold worth $250,000 would be much more difficult to liquidate than, for example, 25 bars of gold worth $10,000 each. There is just much more activity with the smaller lots than the larger lots, and this is something that should be taken into consideration when choosing gold as your investment vehicle.

 

Gold bullion can also take form as coins, and often does in the smaller increments. The most popular gold coins are the US Gold Eagle Coin, and the US Gold Buffalo coin. Each coin weighs one ounce. There are also US Eagle gold coins that weigh ½ ounce, ¼ ounce, and 1/10 ounce. Investors buying by the ounce can also purchase small bars in the ounce size. The most popular ounce size gold bullion bar is the Pamp Suisse gold bullion bar, which also comes in 100 gram size, 10 ounce size, and kilo size, which is 32.15 ounces. For international investors, or for domestic investors who prefer international gold, each country produces their own version of bullion, with most being comparable to our Eagle and Buffalo bullion coins and bars.

 

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