Gold price
As with other precious metals, gold prices are listed in troy ounces (about 31.1 grams) and in grams. The price has been set by London Gold Fixing since 1919.
London Gold Fixing’s responsibility arose from the need to set prices for the contracts that were negotiated by participants of the London Gold Exchange. This price is currently accepted as the practical recommended price on the market. In 1919, the first fixing set the price to 18 shillings and nine-pence, or GBP 4.9375 /toz. Afternoon fixing was introduced to the US market in 1968, whereby a price of gold could additionally be determined during the opening hours of the US market.
The current gold price (spot price)
In a world of 24-hour trade, the current gold price fluctuates throughout the day. Trade in physical gold takes place in the COMEX department of the New York Mercantile Exchange in the form of futures and in Contracts For Difference (CFDs).
The futures gold market is actually many times larger than the quantity of physical gold that is traded, which is possible because the buyers of the futures gold market do not intend to physically receive the gold; instead they are primarily trading as speculation on the price. In CFD trading the actual delivery of gold is no longer the main purpose (in contrast to a futures contract).
The current price in CFD trading – also called the spot price – is determined by supply and demand, with London Gold Fixing being employed as the recommended price. This spot price is used worldwide as the base gold price for physical trade.
Volatility of the gold price
Looked at historically and compared to other investment categories, gold prices show moderate volatility. Extreme peaks are levelled off by longer periods of relatively little movement.
The gold price at GoldRepublic
GoldRepublic only trades in physical gold and silver. GoldRepublic’s buy and sell prices are based on the spot price (in other words, the current gold rate), multiplied by a dealer spread for physical trade. This is taken with gold prices for which GoldRepublic can buy and sell for purchasing physical gold and silver.
