As inflation rises and the economy teeters on the edge of collapse, more people are buying gold as an alternative to other investment options. Gold, in all its forms, has remained an excellent choice for consumers who want to add stability to their portfolio. For gold to be an effective investment, however, it’s essential to understand it and approach it correctly. First, one should examine the history of gold prices to the present day and learn the most reliable ways of getting the most gold for the dollar.
What is the price of gold per ounce?
Gold is priced in terms of troy ounces, which are different from the ounces normally used by Americans. While a standard ounce is about 28.35 grams, a troy ounce is about 31.1 grams. This makes international comparisons and trade easier, but it can make initial purchases more complicated for Americans at first. When it comes to larger investments in bullion, these differences become much more important to consider.
As of October 30, 2013, one ounce of 24-karat gold is worth 1,354.42. An ounce of 22-karat gold is 1,241.55. As purity decreases, the price of gold per ounce continues to fall as well. 21-karat gold is currently priced at 1,185.12, and 10-karat is at 564.34.
Real Time Gold Prices
What is gold spot price?
Spot price is essentially the present market price for a commodity, and it’s based on exchanges on Comex and the New York Mercantile Exchange, or NYMEX. When spot price refers to gold, it’s calculated with future market demand in mind. Spot price is reflected in the amounts one can expect to pay for physical gold at a dealer, and payment and delivery are included in the total. For day traders, gold spot price is helpful for predicting future values. It’s important to note that larger gold transactions naturally require more time and expense for shipment by brokers, so gold spot prices can be more or less relevant based on how much is bought. In addition, investing in gold by spot price can result in having to pay more commissions to brokers over the course of a large number of transactions.
What Factors Influence the price of gold?
The question, “What is the price of gold per ounce?” is answered by a long list of factors at any given time. First, the law of supply and demand affects gold price as consumer interest in gold waxes and wanes. In recent years, economic uncertainty has increased consumer interest in gold and has driven up value as a result. In fact, any major world event, including war and terrorist attacks, has historically caused gold to increase in price. As mining companies and central banks buy and sell gold, the market value can change significantly. Because gold has also become more difficult and expensive to mine, the price of gold per ounce has tended to rise. The value of currency is constantly changing, resulting in increases and decreases of gold price in proportion to currency value in any country. As interest rates increase and inflation rises, more investors seek gold as an investment of solid value, raising its price. Finally, the wide range of industries using gold also affects gold price depending on their increased or reduced use of this precious metal.
How has gold’s value changed throughout history?
Gold has been valued since the Egyptians and Sumerians first started mining and using gold thousands of years ago. Since the beginning of the 20th century, gold’s value has risen and fallen, but the overall trend has been a significant increase. A look at inflation-adjusted prices illustrates this. In 1915, gold was $400 per ounce, but it dropped slightly to $300 until the 1930s. From there, gold rose to $580, then fell to $330 in 1950. Prices hit $660 by 1974, dropped to $430 in 1977, then skyrocketed to a record of $2,000 in 1984. Gold’s value decreased to $340 in 2001, but it has risen fairly consistently since then, with the biggest price increases happening since the recession began in 2008. Today, interest in gold as an investment is soaring, and this is reflected in its growing value.
What forms of gold can you buy?
There are plenty of gold options, and all can be expected to be fairly rock-solid in future value. However, the best one for each consumer depends on their own financial situation and goals. Gold bars are usually 24-karat or near it. Coins, another tangible option, vary but are sometimes 24-karat as well. Both are considered forms of bullion and can be expected to stay stable in value because they align so closely with gold’s basic performance. For investors who like the idea of collecting, collectible and proof coins are other options. Because their value also depends on rarity, investing in them calls for more expertise, and their long-term stability does partly depend on the collecting market. Bullion can also be bought in the form of an IRA, which lets investors avoid having to safeguard physical metal. Another non-physical choice is that of exchange-traded funds, which are easy to invest in and simple to sell later. In many cases, ETFs have backing in physical gold, making them especially stable. Stocks, in the form of futures or options, such as in mining companies, are vulnerable to market changes and call for more research before purchase. Finally, gold accounts, either allocated or unallocated, are convenient options available from banks and can be cashed in quickly.
Where can you find the best deals on gold?
Investors looking to buy gold should shop around and ask, “What is the price of gold per ounce you offer?,” as this can vary significantly between sources. Reputable dealers can be found both offline and online, and many online dealers will ship to customers for convenience. Bars and bullion coins are ideal choices for first-time investors thanks to simplicity and stability. Before buying from a dealer, it’s essential to research them and confirm that their gold is genuine. One should also become familiar with the current value of gold per ounce, paying careful attention to the spot price. Finally, it’s a good idea to understand and compare dealer commissions and fees to get the best possible deal.