How Much is a Gold Bar Worth?
How much is a gold bar worth? It depends, among other factors, on the size of the gold bar. The largest practical investment grade gold bullion bars weigh close to 400 troy ounces or 12.4 kilograms. To calculate the price of a 400 oz brick of gold, simply multiply the current spot price of gold by 400. The spot price is how much one troy ounce of gold costs and is determined by the market. For example, if the spot price of gold is $1,000, a 400 oz bar is worth $400,000. If the spot price of gold doubles to $2,000, that same 400 oz bar of gold is now worth $800,000. This is how the estimated price of a gold bar is calculated.
Investors should understand that the more gold they purchase at once, the more they will save on initial costs and price premiums. Think of it like a quantity discount – the more you buy at once, the more you save. The United States Treasury holds 400 oz gold bars in the Fort Knox Gold Bullion Depository. Gold bricks – 400 oz gold bars, are typically the size that are held and traded by the world’s central banks.
How Much Does a Gold Bar Weigh?
The largest practical gold bars are approximately 400 troy ounces of pure 24k gold (99.99% purity). A troy ounce is the industry standard for weighing and pricing precious metals. It is based on the ancient unit of weight developed by the Romans. A troy ounce is 1.09714 standard ounces. That means, 400 troy oz gold bars weigh around 27 pounds or 12.4 kilograms each.
London Good Delivery Gold Bar
London good delivery gold bars are investment grade gold bullion bars weighing close to 400 troy ounces or 12.4 kilograms. These gold bars do not weigh exactly 400 troy ounces each. They range in actual weight from 350 troy ounces to 430 troy ounces. However, investors only pay for the exact amount of troy ounces in a particular bar when they purchase. London Good Delivery gold bars have a gold content of at least 995.0 parts per thousand fine gold. This is also referred to as fineness. Gold bars are traditionally rectangular in shape and are produced as cast bars. Gold bars are manufactured by a variety of refineries and government mints. Each mint produces a unique look and feel for their 400 oz bars. The traditional recommended dimensions are
- Length (top): 210–290 mm (8.3–11.4 inches)
- Width (top): 55–85 mm (2.2–3.3 inches)
- Height: 25–45 mm (1–1.8 inches)
Gold Bars Overview
Gold bars may be one of the most cost-efficient ways to add more total ounces of gold to your investment portfolio. Another term for god bar is ingot. Gold bars and ingots come in many different shapes, sizes and weights. Their quality is guaranteed as they are produced by many of the world’s top mints and refiners. Gold bars can be produced in large quantities and carry no face value. As a result, gold bars may carry much smaller premiums when compared to gold coins and smaller ingots. If your primary objective is to acquire as many total ounces of gold as possible, then gold bars may be the best choice. Large gold bars offer a significant bang for your buck over other forms of gold bullion.
Gold bars come in different purities as well. Certain gold bars that are 999.9 percent fine gold may potentially be eligible for purchase within an IRA account. Of course, you should always consult your tax professional about eligibility and rules before making any purchases for your Gold and Silver IRA account.
Small Gold Bars – Under 1 0z
One ounce gold bars remain one of the most popular weights. But, gold bars are also available in many smaller sizes. This makes them relatively more affordable for smaller investors or those on a tight budget. Some of the smaller gold bar weights available today are:
- 1 gram
- 2.5 gram
- 5 gram
- 10 gram
- 20 gram
Larger Gold Bars – Over 1 oz
Bars also come in gram denominations that are larger than a single ounce such as 50 gram, 100 gram and 250 gram weights. Bars can also get significantly larger than the 1 ounce weight. They are available in 10 ounce, 1 kilo and even 400 ounce weights. Gold bars offer an investor extremely high value in a very compact space. This makes them ideal for home storage. Smaller gold bars, in particular, can be stored in a home safe, a bank safe deposit box or the depository of your choice.
Some larger gold bars come with the added benefit of an assay card and/or assayer’s mark on the bar. An assay card provides the buyer further evidence of the bar’s metal content and purity. In addition, many gold bars come with a unique serial number inscribed on the bar that can be used to verify authenticity. Gold bars come in two very distinct styles:
- Minted gold bars – are produced by taking blank gold bars and then stamping them with designs, inscriptions and mint marks. These gold bars typically have a sleek and smooth finish with a bright shine.
- Cast bars – are produced by casting, or pouring liquid gold into molds. These bars then have identifying marks and engravings done afterwards. Markings and designs on cast bars are typically simpler than minted bars, and the bars have a rugged appearance.
Cast Bars usually carry lower premiums
No two cast bars are exactly the same due to the fabrication process. Cast bars may potentially carry lower premiums compared to minted bars, as the production process is faster and cheaper. Whatever gold bars you choose, these products provide a means for acquiring gold bullion with ease and convenience. In fact, you can order gold bars from numerous online dealers and expect them to be delivered to your doorstep within a matter of days. (Source: goldprice.org)
How Much is a Gold Bar Worth – Price Basics
The base price of all gold products are determined by the gold spot price. The gold spot price is dynamic and is constantly changing while the markets are open. The price of gold bars is not exclusively determined by the spot price of the gold content. Gold bars will have some sort of premium on top of the value of the gold they contain. Depending on the dealer and the mint of the bars, these premiums can vary significantly. Factors that determine how much a gold bar is worth are size and premiums.
How much is a gold bar worth? Size Matters
Obviously, different sized gold bars are going to have differing prices. Gold bars can be minted in sizes ranging from 0.5 grams all the way up to 250 kilograms– which is the weight of the largest gold bar in the world. When the average person thinks of a gold bar, they would most likely picture a 400 oz bar, which is considered the “standard” weight for gold bars. A 400 oz bar is also nicknamed a “Good Delivery Bar”. They are nicknamed this because they meet the standards set by the London Bullion Market Association. More practical gold bar sizes are typically much less than 400 oz. The most commonly traded gold bar weights are kilo bars and lighter. The most common weights are 1 oz, 5 oz, 10 oz, kilogram, and other various gram bars.
Gold Bar Premiums
Generally speaking, this added cost over the spot price for any bullion derives from a number of factors. This includes the production, storage, and overhead costs incurred by the mint and refinery in producing the coin. Also, there is often a mark-up to cover the selling cost and the profit for the wholesaler selling the coin to a retailer. Some premiums are a set as a monetary amount over the spot price. Other premiums can be a set percentage over the spot. Set monetary premiums are most common among bullion items that are 1 oz in weight.
How Much is the London Good Delivery Gold Bar Worth?
Is is fairly simple to calculate the price of a London Good Delivery Gold bar. Simply multiply the weight of the bar in troy ounces by the purity of the bar and multiply that by the spot price of gold. Then, add or subtract the gold bar premium.
- The gold spot price. The gold spot price is defined as the price of one troy ounce of pure gold that is available for immediate delivery.
- The weight of gold. The weight of pure gold found in a gold bar that is being purchased. A 400 oz gold bar has minimum 0.995 parts of pure gold. As such the 400 oz gold bar will weigh 398 troy ounces of pure gold.
- The gold price premium. The gold price premium is defined as a percentage adjustment that is added or deducted from the gold spot price value of the gold bar. Generally the gold premium of a gold bar is determined by the actual cost of production, logistics and making available for sale the bar, market based competitive forces and the overall value of gold that the client is seeking to invest – as expected larger sums can reduce gold premiums.
How Much is a Gold Bar Worth vs Gold Coins?
If you’re interested in gold as an investment, then there are two main types of physical gold to consider. Gold coins and gold bars. As long as these forms of gold are at least 22 carats in purity, then both should be exempt from VAT. Other types of gold like jewellery, gold dust, lower purity coins, etc, are not VAT expmpt. Therefore, they are less attractive as effective gold investments. Generally speaking, a gold bar will not be worth quite the same as the equivalent weight in gold coins. Put another way, gold bars are typically a bit cheaper to purchase than the equivalent weight in gold coins.
Gold coins usually cost more to produce ounce for ounce. Also, gold dealers will likely pay slightly more for desirable bullion coins such as Sovereigns than a gold bar. This is because the dealer can be market coins to a larger number of potential buyers due to their modest size. Larger gold bars will usually be sold back into wholesale, so premiums are slightly lower to reflect that. The difference only amounts to a percent or so – not a huge difference, depending on the market.
Advantages of Buying Gold Bars
Gold Bars are produced in sizes ranging from 1 gm. to 400 oz or more, with many sizes in between. Like coins, gold bars are portable, private, and liquid, though their advantages are often less understood.
- Diversification – Gold bars are ideal for high-volume gold diversification. Due to their size and simplicity, gold bars are one of the fastest ways you can build your precious metals portfolio. Acquisition can be done in as little time as it takes to process your payment and ship your order. When time is of the essence, buying gold bars can be your fastest route to large-scale gold ownership.
- Cost per Ounce – If you’re looking to buy physical gold at the lowest price per ounce, gold bars could be a great option. You can generally purchase more ounces of gold for less than if you bought the same amount of gold as individual coins.
- Lower Average Premium – In general, premiums on gold bars tend to be lower than for gold coins of the same weight and fineness. It all comes down to production costs. Gold coins can be more expensive to produce than gold bars due to a number of factors. These include intricate design, emphasis on condition and appearance, and thus greater labor and machining costs. Plus, the price of a gold bar is primarily based on its weight. With some gold coins, like certified coins, the rarity and grade of the coin are also considered in the final price. So, with coins, the gold content isn’t the only factor influencing how much the coin will cost.
- Ease of Storage – 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 bar can also take up less space than the same number of ounces in coins. Ultimately, this depends on the type of coin and your storage method.
- Privately Minted – Most gold bars are available from trusted government and private minting institutions. These include internationally renowned Perth Mint in Australia, Johnson Matthew, and Royal Canadian Mint. The United States Mint, however, does not produce gold bars. Many gold bars are not government-issued. However, high-quality bars still come with added assurances like a well-recognized hallmark from the bar’s manufacturer. They also carry a stamp that includes the bar’s weight, purity, refiner, and registration number.
- Easy to Purchase, Easy to Sell – Gold bars are just plain gold, pure and simple. Because of this, they’re one of the easiest forms of the precious metal to understand. For the most part, there are no intricate designs or special finishes that must be preserved to near-perfection. Also, a bar typically doesn’t have historical significance that’s limited to one culture or country. Given this simplicity, gold bars can be easy to buy and sell. They’re accessible and appealing to a variety of buyers. this includes commercial, private, domestic, and international. (Source: usmoneyreserve.com)