|
ASSAY |
|
To test a metal
for purity.
|
|
BID/ASK
|
|
"Bid" or "buy" is
the price a dealer is pre-pared to pay for gold bullion. "Ask" or
"sell" is the price offered by the seller. (See also definition of
"Spread" below.) |
|
BULLION |
|
Refined
gold that is at least 99.5% pure, usually in the form of bars,
wafers or ingots. |
|
BULLION COIN |
|
A legal
tender coin whose market price depends on its gold content, rather
than its rarity or face value. |
|
FACE VALUE |
|
The nominal value given to legal tender coin or currency (for
example a 1-oz. Gold American Eagle coin has a face value of $50). |
|
FINE, FINENESS, FINE GOLD |
|
The
quantity of pure gold contained in 1,000 parts of an alloy. A
normal "good delivery bar" of 0.995 fineness contains 995 parts of
gold and 5 parts of another metal. Gold is produced in bars up to
a purity of 999.9 (often referred to as "four nines"). |
|
FUTURES
CONTRACT |
|
A firm
commitment to make or accept delivery of a specified quantity and
quality of a commodity on a specific date in the future. |
|
GOLD STANDARD |
|
A
monetary system based on convertibility into gold; paper money
backed and interchangeable with gold. |
|
GRAIN |
|
One of the earliest weight units used for
measuring gold. One grain is equivalent to 0.0648
grams. |
|
HALLMARK |
|
A mark,
or marks, which indicates the producer of a gold bar and its
number, fineness, etc. |
|
KARAT |
|
Unit of fineness; scaled from one to twenty four.
-
24 karat gold is considered pure gold having at least 999 parts
pure gold per thousand parts
-
18-karat has 750 parts pure gold and 250 parts alloy
(non-gold) 750:250 = 1,000 Parts Total.
|
|
KILO
BAR |
|
A bar
weighing one kilogram. This would be approximately 32.1507 troy ounces. |
|
LEGAL
TENDER |
|
The coin
or currency which the national monetary authority declares to be
universally acceptable as a medium of exchange; acceptable for
instance in the discharge of debts. |
|
LIQUIDITY |
|
The
quality possessed by a financial instrument of being readily
convertible into cash without significant loss of value. |
|
LONDON
FIX |
|
The
twice-daily bidding session in London of the five major gold
traders, at which the gold price is fixed or set. The London Fix
provides the basis for many gold contracts worldwide. |
|
NUMISMATIC |
|
Coins
that are valued for their rarity, condition and beauty beyond the
intrinsic value of their gold content. Generally, premiums for
numismatic coins are higher than for bullion coins. |
|
OPTION |
|
The
right, (not the obligation), to buy or sell a commodity or a
financial security on a specified date in the future. |
|
PENNYWEIGHT |
|
An American unit of weight for gold.
Twenty pennyweights equal one ounce. |
|
PREMIUM |
|
The
amount by which the market value of a gold coin exceeds the actual
spot value of its gold content. Part of the premium is recovered
by the seller at resale. |
|
RESTRIKE |
|
A modern
replica of previously issued coins. Governments and their mints
can choose to "restrike" a previous issue rather than introduce
new coinage. |
|
SPOT
PRICE |
|
Sometimes
referred to as the cash price. The current price in the physical
market for immediate delivery of gold. |
|
SPREAD |
|
The
difference between Bid (the price a buyer is prepared to pay for
gold) and Ask (the price a seller offers) prices. |
|
TROY OUNCE |
|
A unit of
weight, equal to about 1.1 avoirdupois (ordinary) ounces.
The
word ounce when applied to gold, refers to a troy ounce. |
