11 April 2013

Gold Special Offers: How to Buy at the Best Price & Avoid Pretentious Window-Dressing

This short article explains how you could save a stunning 300 Pounds on a 20 coin purchase by just comparing prices from different bullion dealers and not buy “The Special Offer”.

The Gold Investors mind set is: How much am I paying over spot? This is the only real and legitimate question as it tells you the truth about your potential gold purchase. The Spot price is the gold price, fixed in London twice daily, continued with New York and then over night in the Asian trading. Before buying you need to find a good bullion dealer and you need to know the basics of investing in Gold.

Let’s look at an example of ATS Bullion with their gold newsletter from 11th April “1oz Pure Gold Maple Sale”

This is simply an example for you to see how the mechanism works and not to be fooled around by buying into a Special Offer and then getting ripped off.

[Picture above: The ATS Gold Newsletter from 11th April]

Buy the Maple Leaf 1oz pure gold coins and receive an enormous 25 Pound discount. Let’s look at what the ATS website says:

[Picture above: The ATS website showing the Maple Leaf]

The Website Price is 1,093 Pounds minus the “enormous” 25 Pound discount = 1,068 Pounds.

Below is a screenshot of CelticGold’s website to reference the price:

 

[Picture above showing the Maple Leaf  on the CelticGold website]

The buying price is in Euros; so we need to convert this into Pounds at 1,174 GBP/Euro = 1,052.91 Pounds for the 2013 fresh minted Maple Leaf.

The Gold Spot Price

Let’s now have a look now at the spot price referenced on both the ATS and CelticGold websites:

This screen shot was done at exactly 2pm on April 11th 2013. As the ATS Bullion price gets updated every 15 minutes there is a very slight price difference that occurs.

The Gold Investor’s Math:

Let’s say you wanted to buy 20 gold coins; The Investor wants the lowest possible price and therefore calculates the percentage between the gold spot price and the buying price of the coin. The result is called premium, margin or spread.

Here’s the math:

  Gold Spot Price 1oz Maple Leaf Price Premium above Spot
ATS 1,012.74 1,068.00 5.46%
CelticGold 1,012.74 1,052.91 3.97%

The above table tells you the truth about “Special Offers”. The Special Offer from ATS bullion is still overpriced from the regular price on CelticGold.eu. Buying 20 gold coins would have saved you:

1,068 special price from ATS minus 1,052.91 from CelticGold = 15.09 Pounds saving per coin times 20 coins = 301.80 Pounds.

Summary:

Before buying you need to calculate the premium. The premium is the percentage between the spot price and buying price of the gold product (bar or coin) you are interested in. Also to be sure to check on delivery, availability and shipping costs. In the above case all products with both dealers are in stock with estimated delivery times of 1-2 days. On this type of orders CelticGold offers free insured Express shipping but we couldn’t find any info on Shipping costs on the ATS website.

Author: celticgold.eu

Older 11 Secrets to Doubling Your Wealth in the Next 5 Years Newer What is the Price of Gold?