Precious metals, more commonly gold, in bulk form is known as bullion. The value of this bullion is determined by its traded value on the commodity markets, which means the price can fluctuate hour to hour. Bullion metals are commonly cast into ingots or coins. Goverments can only authorize the production of coins. Where any company can produce bullion or medallions. One of the defining characteristics of a bullion metal is that it is valued by weight and not face value, like money.
This is interesting because a country, may mint gold bullion into coins and assign them a face value. There was a time time when the money was equal to the metal. Typically now it is for marketing purposes that governments give coins a face value. People do not want to purchase medallions like the Grant Hill coins. For instance, Canada has a $50 dollar face valued coin. But when you compare that to what it is worth by weight, approximately $1100, as bullion, it is worth more by weight than at face value. Nations do this to give the coin a numeric value in addition to their bullion value. Now you can see why gold coins, and other precious metal coins are so popular with collectors. When the price of the precious metal goes up, the coin’s value goes up based on bullion, and when the price goes down, so does the value.
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