{"id":29710,"date":"2023-12-06T15:43:49","date_gmt":"2023-12-06T23:43:49","guid":{"rendered":"https:\/\/www.advantagegold.com\/?p=29710"},"modified":"2023-12-06T15:43:49","modified_gmt":"2023-12-06T23:43:49","slug":"what-is-bullion","status":"publish","type":"post","link":"https:\/\/www.advantagegold.com\/blog\/what-is-bullion\/","title":{"rendered":"What Is Bullion?"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">Is it the big geometric shaped gold bars we\u2019ve seen stacked in a James Bond movie? Is it pirate ship gold fished from a shipwreck at the bottom of the ocean?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Gold bullion is physical gold\u2014typically <a href=\"https:\/\/www.advantagegold.com\/blog\/gold-coins-vs-gold-bars\/\">gold bars and coins<\/a>\u2014with a minimum purity of 99.5% for gold bars and typically no less than 90% purity for gold coins. Investors normally seek gold bullion because of its ability to:\u00a0<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Store value<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Diversify a portfolio<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Serve as an inflation hedge<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Provide a safety net as a safe haven asset<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">The value of physical bullion stems from its gold content. Except in rare cases, bullion does not appeal to collectors.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Bullion\u2019s primary uses are in the jewelry and investment industries.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Jewelry manufacturers acquire bullion in the form of ingots\u2014pure metal cast into a shape fit for transportation and processing. They add other metal alloys to achieve the desired karat and then produce the jewelry.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Individual investors typically acquire gold and silver bars and coins to keep on hand. They generally self-store their gold.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Investors in <strong><a href=\"https:\/\/www.advantagegold.com\/approved-precious-metals\/gold-coins\/\">IRA-eligible gold<\/a><\/strong> and <strong><a href=\"https:\/\/www.advantagegold.com\/approved-precious-metals\/silver-coins\/\">silver<\/a><\/strong> store their holdings in the confines of a precious metals IRA, also known as a <a href=\"https:\/\/www.advantagegold.com\/gold-ira-investment\/\">Gold IRA<\/a> and <a href=\"https:\/\/www.advantagegold.com\/blog\/what-is-a-silver-ira\/\">Silver IRA.\u00a0<\/a><\/span><\/p>\n<p><span style=\"font-weight: 400;\"><a href=\"https:\/\/www.gold.org\/goldhub\/data\/gold-reserves-by-country#:~:text=Gold%20is%20an%20important%20component,has%20been%20mined%20throughout%20history\" target=\"_blank\" rel=\"noopener\">Central banks own 20% of all the gold ever mined.<\/a> They use gold as a store of value, to pay international debts, and as a lending vehicle.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Bullion Banks\u00a0<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Bullion banks lend gold in much the same manner that traditional banks lend money. Bullion banks also act as intermediaries between gold lenders and borrowers.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Bullion banks participate in the many aspects of the gold market, including:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Trading<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Hedging<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Clearing<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Risk management<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Vaulting<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">The London Bullion Market Association (LBMA) is a London-based trade association representing\u00a0 the market for gold and silver bullion. Its membership is worldwide and comprises almost all bullion banks.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The LBMA uses an over-the-counter market model, meaning trading happens directly between two parties as opposed to via a centralized exchange. It comprehensively services the needs of central banks, private investors, gold producers, fabricators, miners, and mining companies.\u00a0<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Types of Bullion<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Bullion isn\u2019t limited to gold. The primary precious metals\u2014gold, silver, <a href=\"https:\/\/www.advantagegold.com\/approved-precious-metals\/platinum-coins\/\">platinum<\/a>, and <a href=\"https:\/\/www.advantagegold.com\/approved-precious-metals\/palladium-coins\/\">palladium<\/a>\u2014all have bullion representations.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Bullion takes several forms, each with different uses.\u00a0<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Forms of Bullion\u00a0<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Bullion precious metals include selections of bars, coins, and rounds:<\/span><\/p>\n<ul>\n<li aria-level=\"1\"><b>Rounds <\/b><span style=\"font-weight: 400;\">are precious metals coins with no denominational value. Made by private companies, rounds are generic discs that serve as a store of value.<\/span><\/li>\n<\/ul>\n<ul>\n<li aria-level=\"1\"><b>Bars <\/b><span style=\"font-weight: 400;\">typically trade at the lowest premiums over <a href=\"https:\/\/economictimes.indiatimes.com\/definition\/spot-price\" target=\"_blank\" rel=\"noopener\">spot price<\/a> and return the most gold per dollar. They can be cast or minted. Casting involves pouring smelted metals into casts and stamping the resulting bars with their purity and weight figures. Minted bars are cut from smooth sheets of metal and laser-engraved for a more finished look.\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li aria-level=\"1\"><b>Coins <\/b><span style=\"font-weight: 400;\">are made by government mints, which meticulously plan and process their forms. Coins have a legal tender value that is usually far below the intrinsic value of the metal. Due to their high production costs, bullion coins typically trade well above spot price.\u00a0<\/span><\/li>\n<\/ul>\n<h3><span style=\"font-weight: 400;\">Bullion Metals\u00a0<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Gold, silver, platinum, and palladium\u2014the primary precious metals\u2014are all available in bullion form.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Each rare metal has intrinsic value and can act as a mechanism for wealth preservation.\u00a0<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">How to Purchase and Invest in Bullion\u00a0<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">There are many ways to own and invest in bullion. Let\u2019s explore some of the most common avenues.\u00a0\u00a0\u00a0<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Bullion Bars and Coins<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Those seeking physical bullion buy bars and coins. Both are readily available at local coin dealers, and there is no shortage of online shops that sell bullion.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">To have bars and coins directly delivered to your doorstep or set up a <strong><a href=\"https:\/\/www.advantagegold.com\/approved-precious-metals\/\">precious metals IRA<\/a><\/strong> containing bullion, be sure to choose a reputable dealer like Advantage Gold.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">For the past decade, Advantage Gold has been educating clients and guiding investors through the precious metals acquisition process.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">We often answer questions like, \u201cWhat is gold bullion?\u201d or, \u201cWhat is silver bullion?\u201d Our account executives know how to clearly explain not only the what but the why and the how.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The precious metals IRA\u2014also known as the Gold IRA and Silver IRA\u2014allows ownership of precious metals inside a tax-deferred account.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">You can invest in physical gold, silver, platinum, and\/or palladium with funds already allocated for investment.\u00a0<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Exchange-Traded Funds (ETFs)\u00a0<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Those who don\u2019t want physical bullion but want bullion in their portfolio can buy shares of precious metals ETFs. ETFs trade on stock exchanges and link to contracts backed by silver or gold.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">ETFs are easy to buy and sell. They are available on most online exchanges, and you can buy them just like you buy regular stocks.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">ETFs don\u2019t easily convert to physical metals\u2014they\u2019re more a play on the price and demand.\u00a0<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Futures Contracts\u00a0<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">The Chicago Mercantile Exchange (CME) sells precious metals futures contracts. Futures give you the right to buy or sell a certain amount of a commodity, at a certain price, at a specific time in the future.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Investors either liquidate positions before maturity or take delivery of the purchased commodity.\u00a0<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Invest in Bullion\u00a0\u00a0<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">The world of bullion seems more intimidating than it actually is. Bullion simply is bars and coins made to investment-grade specifications.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Next time someone asks, \u201cWhat is a bullion coin?\u201d you can hopefully give a clear and concise answer.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Until then, call us or <a href=\"https:\/\/www.advantagegold.com\/contact\/\"><strong>click the link<\/strong><\/a> if you have questions. An Advantage Gold representative will be happy to assist you with answers and show you how easy it is to add physical bullion to your portfolio.\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Is it the big geometric shaped gold bars we\u2019ve seen stacked in a James Bond movie? Is it pirate ship gold fished from a shipwreck at the bottom of the ocean? Gold bullion is physical gold\u2014typically gold bars and coins\u2014with a minimum purity of 99.5% for gold bars and typically no less than 90% purity [&hellip;]<\/p>\n","protected":false},"author":17,"featured_media":27529,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[47,6],"tags":[1368,1369,1370],"class_list":["post-29710","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-gold-archive","category-silver","tag-what-is-a-bullion-coin","tag-what-is-gold-bullion","tag-what-is-silver-bullion"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.advantagegold.com\/wp-json\/wp\/v2\/posts\/29710"}],"collection":[{"href":"https:\/\/www.advantagegold.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.advantagegold.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.advantagegold.com\/wp-json\/wp\/v2\/users\/17"}],"replies":[{"embeddable":true,"href":"https:\/\/www.advantagegold.com\/wp-json\/wp\/v2\/comments?post=29710"}],"version-history":[{"count":0,"href":"https:\/\/www.advantagegold.com\/wp-json\/wp\/v2\/posts\/29710\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.advantagegold.com\/wp-json\/wp\/v2\/media\/27529"}],"wp:attachment":[{"href":"https:\/\/www.advantagegold.com\/wp-json\/wp\/v2\/media?parent=29710"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.advantagegold.com\/wp-json\/wp\/v2\/categories?post=29710"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.advantagegold.com\/wp-json\/wp\/v2\/tags?post=29710"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}