Buying gold bars is a highly effective method of safeguarding your wealth. It’s an investment that provides a sense of unparalleled security in an uncertain world. Due to the unpredictable economic future, investing in traditional assets, such as stocks and bonds, is increasingly more risky. In this environment, it makes sense to own gold in order to diversify your portfolio and attempt to mitigate these risks and provide an element of financial insurance. But how much do you actually know about gold bars? If you’ve ever wondered, “what are gold bars?” you’ve come to the right place. Let’s take a closer look at gold bars and everything you need to know before you take the plunge.
What Are Gold Bars?
As its name suggests, a gold bar is a uniform block of gold with minimum purity of 99.5%. Also known as gold bullion, they come in a variety of weights and sizes, each with its own set of pros and cons, to fit the preferences of any investor.
Gold bars are supplied by sovereign mints and private refineries. Smaller gold bars are minted using heavy machinery, whereas larger gold bars are cast by pouring molten gold into a mould.
Gold bars can be used in numerous ways, such as :
- Commercial Finance Instrument: Large organisations may want to add gold bars to their finance portfolios. Doing this could help them borrow at a lower rate.
- Personal Asset: People have always been drawn to gold because of its beauty and worth. Today, gold bars are primarily used as a long term store of value and to achieve financial security.
- Reserve Currency: Gold is no longer used as a circulation currency. It is now used as a reserve currency for international trade and to stabilise currency value.
Now that you know what gold bars are, and why they’re important, let's discuss them in detail to clarify the options open to you if you’re interested in adding gold bars to your investment portfolio.
What Is Investment Grade Gold?
If you’ve ever owned or bought any gold jewellery, you probably know that the purity of gold used in jewellery is measured in carats. For example, 18-carat gold is 75% pure gold, while 24-carat gold is 99% pure gold. These variances result from gold jewellery being alloyed with other metals such as silver, copper, or platinum to reinforce it and generate distinct colours such as white gold.
Unlike most gold used in jewellery, investment grade gold is the purest form of gold, with a purity of 99.5%. This is also referred to as gold bullion, and is available in bars or coins. The value of both gold bullion coins and bars is determined by the spot price of gold plus a premium that covers production costs, and the dealer's premiums also reflect the imbalances between supply and demand for specific bars or coins. Investment-grade gold is the only form of gold deemed an investment and is stockpiled by banks, governments and private investors.
How to Identify Investment Grade Gold Bars
It is easy to identify investment grade gold bars. In terms of features, most investment-grade gold bars are relatively similar. They must have a specific shape, weight, and purity to be considered investment grade. Each bar should bear the name and logo of the sovereign mint or refinery, and bigger bars need to have a serial number to be considered. These safeguards are in place to help prevent counterfeiting and to prove authenticity.
All recognised mints and refineries adhere to stringent standards, which allows their gold bars to be bought and sold internationally with ease.
Among the world's most well-known mints are:
- Argor Heraeus
- Credit Suisse
- Johnson Mathey
- MKS Pamp
- Perth Mint
- Royal Canadian Mint
At GoldCore, we only trade gold bars made by London Bullion Market Association (LBMA) approved refineries and government mints. Doing this ensures authenticity, competitive pricing and liquidity.
How Much Does a Gold Bar Weigh? Gold bars come in various sizes, namely:
- 1 oz
- 10 oz
- 1 kilo
- 100 oz
- 400 oz (London Good Delivery Bars)
The most common form of gold bullion bars is London Good Delivery bars. These bars individually weigh 400 oz and are stockpiled and traded by investors, banks and governments.
The bars usually bear a unique serial number, the name and logo of the mint or refinery where they were created, and their purity.
Even though they are less common than gold coins, buying gold bars is a convenient way of investing in physical gold, especially for investors, companies and institutions interested in bulk purchasing investment-grade gold.
How Much Is a Gold Bar Worth?
The price of gold is easily calculated. However, just like with other investments, the price is continuously fluctuating. To understand the current value of gold, you need to keep an eye on its current market price.
Several factors can influence how much a gold bar is worth, namely the following:
- Gold Spot Price: this is the wholesale price at which 400 oz gold bars (London Good Delivery Bars) are traded between banks in international markets. Typically, private investors will pay a premium over the spot price. It takes less time and effort to produce bars, which is why they tend to have a smaller premium than gold coins, and gold dealers generally charge lower premiums for larger bars.
- Gold Content: According to the London Good Delivery List, administered by the London Bullion Market Association (LBMA), investment-grade gold bars must have a minimum fineness of 995.0 parts of fine gold per thousand. Therefore, the higher the gold content, the higher the worth of the gold bullion bar.
- Investor Demand: As mentioned above, the purest bars are the most sought after and can command a higher premium. Imbalances between supply and demand can influence the premiums at which gold bars trade.
- Weight: the worth of a gold bar will always be influenced by its weight. The more it weighs, the more it's worth.
In general, you can easily calculate the actual value of a gold bar by multiplying the current gold spot price by the weight of the pure gold content. You can read more in our blog post "How Much Is a Gold Bar Worth?".
Keep Up to Date With Gold Prices
Here at GoldCore, we know how difficult it can be to have up-to-date information about your gold investments. Therefore, we have added a live feed to the top of our website, so you're always in the know. Simply visit our homepage if you need an accurate update on the price of gold.
Are Gold Bars a Good Investment?
During times of financial uncertainty, gold provides you with a sense of financial security that other investments can’t. Unlike stocks and bonds, gold tends to appreciate amid economic tensions and turmoil, such as inflation or currency crises. In fact, in times of economic uncertainty, the value of gold tends to increase significantly. During the global pandemic in 2020, the value of gold skyrocketed and reached a historic high. At the start of the Russian invasion of Ukraine, gold was also significantly appreciated. This demonstrates how gold's value can perform, even during times of crisis, when other assets tend to underperform.
However, is this true for smaller gold bars as well?
Is It Worth Buying 1g Gold Bars?
Smaller gold bars, such as 1g bars, do not represent a good investment for most people. Because of their small size, they have massive premiums. Rather, we recommend buying bigger bars, as gold dealers charge a much lower premium for them than they do for smaller bars. You also have safer options for storage. While storing 1g gold bars in a professional vault would be very uneconomic, using specialised insured vaults run by professionals in secure jurisdictions is the perfect choice for larger bars.
Not only are these vaults extremely secure, but they also make the process of selling gold faster and easier, as the gold bars remain within what is called the “chain of integrity”. Gold held in a private residence, or even a safety deposit box, has to go through a series of checks during a process to re-authenticate the gold bars before a dealer can accept them.
Where to Buy Gold Bars
Research is essential when deciding where to buy gold bars, and it's not a decision to be taken lightly. We recommend reviewing customer testimonies to guarantee you're dealing with a reputable trader that you know you can trust.
Numbers don't lie, and with more than 14,000 clients and over $1 billion in transactions, it is clear that GoldCore is a top choice among precious metal investors. Read some of our positive client reviews here.
How to Buy Gold Bars
Buying gold bars from GoldCore is an efficient and straightforward process. Firstly, click on the “Open Account” green button in the top right corner of our homepage. You have the option of choosing from a range of accounts, with which you can trade in different currencies. You can have as many accounts as you please in as many currencies as you like.
Set Up Your Account
Firstly, you’ll want to open your account. Choose from one of the following options:
- Personal Account: This account is ideal for private individuals who want to manage all their precious metal investments. You can use this account to handle your investments, including buying, storing, selling, and receiving gold bars at any time.
- Joint Account: This account type is similar to a personal account, but can be used by more than two private individuals. Depending on what suits you best, you can decide between a single signature and a dual signature account.
- Corporate/Trust Account: This type of account allows companies, charities and trusts to trade gold bars. To open this account, you will need to provide the correct documentation and appoint a representative to operate on behalf of the group.
- Pension Account: With our pension account option, you have the opportunity to secure your future by processing your precious metal-approved pension investments. It is vital to note that pension assets cannot be delivered to an individual while they are held in a pension account.
All accounts give you the option to buy, sell, store, and receive delivery of gold coins, bars, and Perth Mint Certificates.
Provide the Necessary Documents
Next, you need to provide us with the necessary documents to confirm your identity and give proof of residency. To prove your identity, you need to provide us with either a copy of your passport or driver’s license. You can supply documents such as utility bills, bank statements, or government-issued correspondence for proof of residency. These documents must be current, no more than six months old.
There’s no need to send in physical copies. Simply scan or take a clear photograph of your documents and upload them to our site.
Fund Your Account
Once you have chosen an account and provided the necessary documents, your account will be open. Now you need to fund it.
At GoldCore, we give clients the option to use bank transfer or a credit/debit card. Furthermore, trading can be done in various currencies.
Choose whichever method suits you best:
- Credit/Debit Card: Using your credit or debit card allows you to get started immediately. You can buy up to €/£/$50,000 (EUR, GBP, USD) worth of gold bars online right away! Ensure you have your special Verified by Visa password or Mastercard SecureCode password.
- Bank Transfer: The most cost-effective option is to transfer funds from your bank to ours. It is important to note that we keep client funds separate from our own in segregated bank accounts.
Now that everything is set up, you are ready to get started!
Start Investing in Gold Bars
Owning physical gold is a long-term investment that can help you protect your wealth. It allows you to diversify the risk of other investments and is a fantastic addition to your financial portfolio.
Now that you’ve answered the question “what are gold bars?”, are you ready to invest in the precious metal? GoldCore makes this process easier than ever.
We know that each client’s needs differ, which is why we strive to provide you with the best service and solutions to meet your needs.
We offer some of the most competitive premiums for delivering and storing gold in the UK market.
If you’re still unsure about investing in gold bars or have any queries, we are more than happy to help. GoldCore offers a free strategy call to discuss the options and recommend solutions based on your individual needs. Schedule a call with one of our highly trained representatives to learn more about investing in gold.
Alternatively, call one of the following numbers to reach us:
UK +44 (0) 203 086 9200
Ireland +(01) 653 3426
US +1 888 381 8130
Whether you want to buy, trade or store gold bullion bars, GoldCore has got you covered.