Understanding the difference between the spot price of gold and buyback can be important for selling you unwanted gold items. Let’s go through the difference between the two.
The spot gold price an indicative reference point in which gold can be purchased and sold right now, rather than at a later period. The spot price is just the current price at which a commodity can be purchased and delivered. In contrast to futures or forward contracts, this is not the case. The price of one ounce of gold is referred to as the spot price of gold, while the price of one ounce of silver is referred to as the spot price of silver.
What is the buyback?
Different Gold Buyers Melbourne have different buyback rates. The buyback is what a particular gold buyer is willing to pay your gold under the spot price. The reason gold buyers Melbourne pay under the spot price is so they can make a profit. They area also charged a refining fee to get your gold refined after its purchased. Typically, in Melbourne most gold buyers will pay you between 85 – 95% of the value or 15 – 5% under spot. This can vary depending on what type of gold it is you have to sell.
Gold nuggets and gold jewellery
The majority of natural gold nuggets are found as pure nuggets or in conjunction with a host rock such as quartz. Natural nuggets found in Australia typically contain about 85 – 95% percent pure gold.
In Australia most gold jewellery is made to be 9k or 18k which translates to 37.5% – 75% pure gold. The rest of the metal in jewellery are alloys that require to be refined.
Nuggets and jewellery are often referred to as scrap gold. Scrap gold is calculated using the current spot price less a commission for profit and refining which is the buyback. When the spot price of gold price rises, you may expect more money as the buyback rises with the spot price and vice versa and when the gold price falls, you can expect less money.
Gold coins and Gold Bullion
A gold coin such as the $200 gold coin or gold sovereign will get you a higher buyback price than scrap gold. The reason for this is its certified gold of high purity such as 22k or 91.67% pure. Gold coins offer gold buyers security by eliminating the unknowns in purity or non gold weight like scrap gold. Expect closer to the 90 – 95% range of spot price for coins.
A 1 oz Gold bullion bar (which contains 31.104 grams of pure gold) will be bought back anywhere up to 97 – 98% of the spot price of gold. This is due to the fact the gold dealer will not have to refine a bullion bar and can simply re-sell it as pure gold bullion to a customer over spot the price of gold. This price is known as the “sell” price of gold which is how much a certified investment grade bar is sold over the spot price.