Gold bars are used as a trade finance tool. Gold bars are used by individuals and governments as a means to store value, stabilize a portfolio or balance sheet, or as a reserve currency. However, gold bars also have a useful function as a commercial financial tool. The compact size, durability and portability of gold bars allow for a variety of easy storage options.
Gold bars can be stacked or stored side by side, with or without protective packaging. A gold ingot can also take up less space than the same amount of ounces in coins, depending on the type of currency and storage method. Gold bars, more commonly known as ingots, are a popular choice for people looking to buy gold. Bars are generally sold by the gram or ounce, and the purity, manufacturer and weight must be stamped on the side of the ingot.
Buying gold bars is almost always cheaper than buying gold coins of the same weight, and the larger each bar, the lower the cost per weight. If you need help calculating the price of gold bars, check out BullionVault's real-time gold price chart, which records changes in the price of gold up to one second, in addition to providing historical data. There were periods when, in the short term, the value of currencies grew more than gold, but in the long term this graph shows exactly why the rich have always maintained it. You can buy rare gold coins, but this is the collector's world, which most investors should avoid.
Take these gold bars out of market-authorized warehouses, even to store them in your bank, and they will break the chain of integrity that guarantees the gold in each ingot to the next buyer. The storage fees for owning part of these large gold bars cost only 0.12% per annum, with insurance included. If you want to buy physical gold at the lowest price per ounce, gold bars may be a good option, since you can generally buy more ounces of gold for less than if you were to buy the same amount of gold as individual coins. For example, by investing in the shares of a gold company, you expose yourself to the economic conditions of the company's country of origin.
At the more expensive end of the price scale for gold bars, novel one-gram gold bars are minted for the gift market. If you're looking to get rich with the modern gold rush, you're probably in the wrong place. You're not speculating on a numismatic coin that will one day get a higher premium than you paid; you're investing in gold bars to protect yourself from the crisis and protect yourself from a loss of purchasing power. For some people, physical assets such as real estate and gold offer greater peace of mind than assets that cannot be touched, such as stocks, bonds and mutual funds.
Like any investment or financial asset, gold is subject to supply and demand pressures that cause the price to fluctuate. In the case of some gold coins, such as certified ones, the rarity and grade of the coin are also taken into account in the final price, so the gold content is not the only factor that influences the final price of the coin. You can also buy stocks of gold mining companies, gold futures contracts, gold-focused exchange-traded funds (ETFs) and other common financial instruments.