Bullion is any precious metal that is in the form of bars or ingots. It is usually used for trade in a market and comes from the original French word “bouillon” which means boiling. This was the term used to describe the activity of a melting metal.
Each Bullion varies when it comes to its value depending on its precious metal content which is determined by its purity and mass. To find out the purity of each gold bullion, they use the century-old method known as fire assay along with modern spectroscopic instrumentation to accurately determine its quality to ensure the owner receives fair market value for it. It is also weighed extremely accurately.
Understanding the bullion market
The bullion market is the avenue by which buyers and sellers can trade in gold or other precious metals. The London Bullion Market is known as the primary global bullion market trading platform for gold and silver.
The bullion market is where you can buy and sell your gold bullion or other precious metal ingots. There are many bullion markets throughout the globe. These bullion markets are typically characterized as over the counter markets. Bullion markets exist in New York, Zurich, and Tokyo with London serving as the location for the largest global bullion market.
Bullion trade is considered to have a high turnover rate with transactions conducted over the phone or electronically, and its primary market is considered to be gold and silver. Gold and silver traded in the bullion market can sometimes be used as a safe-haven investment or hedge against inflation which may also affect its trading value.
The bullion market is one of several ways to invest in gold and precious metals. Other options like exchange-traded funds or mutual funds can also be good ways of investing in gold and precious metals.
Investment
The specifications of bullion prices are often regulated by legislation or market bodies. In the European Union, the minimum purity for gold bullion, which is treated as investment gold with regards to taxation, is 99.5% for gold bullion bars and 90% for bullion coins. You can choose to buy gold for many different investment reasons.
