The MGS Precious Metals Blog

Manhattan Gold & Silver is an industry leader in precious metal pricing and refining with more than 30 years of experience. During our time in the business, we’ve found the topic of precious metals to be a vast and interesting one. Here on our precious metals blog, we write in-depth posts about the science of precious metal refining, historical and modern uses for precious metals, market news, and much more. Subscribe to our RSS feed to stay current, and discuss the latest posts on our Facebook page.

Bullion Explained

March 12, 2010 06:00

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.

For more information about gold, refining and bullion, please visit Manhattan Gold & Silver today.  We have a broad range of services to help you refine your precious metals.

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