If you are working in Singapore, you’ll want to make sure you are maximising your earnings through savvy savings and investments. Online investment platform Bunker Gold&Silver shares regular advice with Expat Living. Here they look at money matters relating to precious metals.
Why buy gold bars rather than coins?
Premium
Gold products follow this rule: the smaller the product, the higher the premium. The premium is the margin added by the seller on top of the standard gold price. A competitive premium for gold is around 1 percent. For coins, the premium can reach 20 percent! If the price of gold on the international market is US$100 per 2.5 grams, you will pay US$101 for this amount of gold in bars, and US$120 by buying coins.
Liquidity
So, from an investment standpoint, bars are more appealing. Above all, their liquidity – that is, the ease for customers to sell them back – is high. Bars previously had low liquidity since their standard weight was a very heavy 12.4kg (around US$500,000 value); this is why coins became popular. But now with the availability of small bars – 100 grams, for example – it’s easy to find buyers for your product. The best bullion dealers can propose a 1 percent premium for 100g bars.
Fungibility
Coins have specific characteristics (for example, a type of animal stamped onto the coin) that make them popular among collectors. However, the demand for a specific product can differ between countries. So, the coins you paid a high price for in the UK because of certain characteristics may have less value in Asia. For bars and especially LBMA bars, the price is standardised around the world.
For more information, call 6933 1391 or email contact@bunker-group.com | bunker-group.com
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This article first appeared in the October 2018 edition of Expat Living. You can purchase a copy or subscribe so you never miss an issue!
