Bullion

Bullion is a bulk quantity of precious metal usually gold or silver, assessed by weight and sold by major banks and dealers. The metal is cast as ingots or bars.

Bullion coins are minted from precious metal, usually gold or silver and bought for investment purposes from major banks, coin dealers, brokerage firms and precious metal dealers. Their value is based on their gold or silver content. Prices fluctuate daily, depending on the world markets. The best known bullion coins are the American Gold Eagle, The Canadian Maple Leaf, the Australian Gold Nugget and the South African Krugerrand.

The U.S. Mint has produced gold, silver and platinum bullion coins since 1986.
The Mint produces two types of bullion coins:
1. Proof bullion coins. These are specially minted for collectors and usually sold in a protective display case
2. Uncirculated bullion coins. These coins are minted for investment purposes and sold to a select number of authorized buyers based on the current market price i.e. the spot price for the precious metal plus a small premium charged by the Mint.

Facts about buying gold:
Information was obtain from an article titled “Investing in Bullion and Bullion Coins” issued by the Federal Trade Commission Consumer Information.
Regardless of the form of gold you may invest in, consider these universal truths:

  • The price of gold fluctuates over time. There is no guarantee that gold will increase – or even maintain – its value.

  • The prices coin dealers, banks, brokerage firms and precious metal dealers charge for gold products, like bullion and coins, are almost always higher than the value of the gold the products contain. So, its wise to compare prices before making a purchase.

  • Some sellers say that the government may confiscate gold. Others say that “reportable” transactions lead to confiscation. Yet other sellers claim that modern bullion coins produced by the U.S. Mint are subject to confiscation while historic or collectible coins aren’t. These claims sometimes lead people to buy historic coins at prices that exceed their value. No current federal law or Treasury Department regulation supports any of these claims.