London Spot
Gold $4,506.15
Silver $75.84
Platinum $1,938.00
Palladium $1,368.00
Rhodium $9,650.00
Gold/Silver Ratio 59.42

Precious Metals Glossary

Clear definitions of the terms you will encounter when researching and buying gold, silver, platinum, palladium, and rhodium.

A

Allocated Storage
A storage arrangement where specific, individually identified bars or coins are assigned to your account. Your metals are segregated from other customers' holdings and cannot be leased or used by the depository.
Assay
A test or analysis to determine the purity and composition of a precious metal. Assay certificates accompany many bars and confirm the metal's fineness, weight, and serial number.

B

Backwardation
A market condition where near-month futures prices trade below longer-dated futures, and sometimes below spot. Rare for gold, more common for silver during episodes of physical shortage. Backwardation signals tight physical supply and urgent near-term demand.
Bid-Ask Spread
The difference between the price a dealer will pay to buy a metal (the bid) and the price they will sell it for (the ask). A narrower spread generally indicates a more liquid and competitively priced market.
Brilliant Uncirculated (BU)
A coin that has never been in circulation and retains its original mint luster. BU coins may have minor contact marks from handling or shipping but show no signs of wear.
Bullion
Precious metals in bulk form (bars, rounds, or coins) valued primarily by weight and purity rather than by rarity, age, or collectible appeal. Bullion is the standard form for investment-grade metals.

C

COMEX
The Commodity Exchange, a division of the New York Mercantile Exchange (NYMEX), where gold, silver, copper, and aluminum futures contracts are traded. COMEX prices are a primary benchmark for precious metals spot prices.
Contango
A market condition where futures prices are higher than spot, reflecting storage, insurance, and financing costs out to delivery. Contango is the normal state for gold markets, where the forward curve slopes gently upward. The opposite of backwardation.

D

Dore Bar
An unrefined alloy of gold and silver produced at mine sites, typically 60 to 90 percent gold with silver and trace base metals. Dore bars are cast at the mine and shipped to refiners for final processing into investment-grade bullion.

F

Face Value
The nominal monetary value stamped on a legal tender coin by its issuing government. For bullion coins, the face value is typically far below the coin's actual market value based on metal content.
Fineness
A measure of the purity of a precious metal, expressed as parts per thousand. For example, .999 fine gold contains 999 parts gold per 1,000 parts total. Also called millesimal fineness.

G

Good Delivery Bar
A large bar meeting LBMA specifications for institutional settlement. Gold Good Delivery bars weigh 350 to 430 troy ounces (roughly 400 oz), and silver Good Delivery bars weigh 750 to 1,100 troy ounces (roughly 1,000 oz). Individual investors rarely own these due to their size and cost.

H

Hallmark
An official stamp applied to precious metal items indicating purity, origin, and sometimes the year of assay. Hallmarking is legally required for jewelry in the United Kingdom, India, and much of Europe. Common marks identify the refiner, fineness, and assay office.

J

Junk Silver
Pre-1965 U.S. coins (dimes, quarters, half dollars) that contain 90% silver. Called "junk" not because they are worthless, but because they have no numismatic premium. They are bought and sold for their silver content alone.

K

Karat
A unit of purity for gold alloys. Pure gold is 24 karat (24k). Common alloys include 22k (91.7% gold, used in American Gold Eagles), 18k (75% gold), and 14k (58.3% gold). Not to be confused with "carat," a unit of weight for gemstones.

L

LBMA
The London Bullion Market Association, which sets standards for gold and silver refining and trading. LBMA-accredited refiners produce bars that meet recognized purity and weight standards, known as "Good Delivery" bars.
Coins or currency that must be accepted for payment of debts by law. Government-issued bullion coins like the American Eagle carry legal tender status, though their face value is far below their metal value.

M

Melt Value
The value of a coin or bar based solely on its precious metal content at current spot prices, disregarding any numismatic, collectible, or face value premium.
Mint Mark
A small letter or symbol stamped on a coin indicating which mint facility produced it. For U.S. coins, common mint marks include P (Philadelphia), D (Denver), S (San Francisco), and W (West Point).

N

Numismatic
Relating to the study or collection of coins, medals, and currency. Numismatic coins derive their value from rarity, condition, historical significance, and collector demand rather than from metal content alone.

P

Pool Account
A storage arrangement in which a dealer or depository holds metal on behalf of many customers without specifically assigning bars or coins. The customer owns a contractual claim on a stated number of ounces, not identifiable pieces. Pool accounts are cheaper than allocated storage but expose the customer to counterparty and bankruptcy risk.
Premium
The amount charged above the spot price for a physical precious metal product. Premiums cover manufacturing, distribution, and dealer margins. Lower premiums generally mean better value, though premiums vary by product type and market conditions.
Proof Coin
A specially manufactured coin struck multiple times with polished dies, producing a mirror-like background with frosted design elements. Proof coins are made for collectors and carry higher premiums than standard bullion coins.

S

Spot Price
The current market price for immediate delivery of a precious metal, typically quoted per troy ounce. Spot prices fluctuate throughout the trading day based on futures contracts, supply and demand, and macroeconomic factors.
Sovereign
A British gold coin containing 0.2354 troy ounces of gold, struck in 22 karat (.9167 fine) alloy. Sovereigns have been minted since 1817 and remain legal tender in the United Kingdom, making them exempt from UK capital gains tax. Popular across Europe for their small size and historical pedigree.

T

Troy Ounce
The standard unit of weight for precious metals. One troy ounce equals approximately 31.1035 grams, which is about 10% heavier than a standard (avoirdupois) ounce of 28.3495 grams. All precious metals spot prices are quoted per troy ounce.

U

Unallocated Storage
A storage arrangement where your metals are pooled with other customers' holdings. You own a claim to a quantity of metal rather than specific, identified pieces. Generally cheaper than allocated storage but carries counterparty risk.