Guides
Bullion pricing guide: spot, premium, spread, and fees
Bullion pricing guide covering spot references, premiums, bids, asks, spreads, payment fees, tax, delivery, storage, net proceeds, and break-even math.
What to take away
- Spot is a market reference with a metal, unit, location, time, and delivery basis.
- Retail ask equals more than metal value; retail bid can be above or below the reference.
- Delivered premium and round-trip spread answer different cost questions.
- Quantity, payment, tax, delivery, packaging, condition, and buyer policy can change the result.
- Save both sides of the market at the same time.
Bullion pricing becomes clear when each number has a label. A dealer's ask is what the buyer pays for a product. A bid is what a buyer offers the owner. Spot or a benchmark is neither one.
Define the reference
Record metal, provider, currency, price unit, timestamp, time zone, publication delay, and delivery basis. The LBMA page for precious-metal benchmark prices explains that its gold, silver, platinum, and palladium benchmarks concern unallocated metal delivered in London and lists their auction schedules. A retail coin shipped to a home is a different product and transaction.
Calculate metal value
metal reference = fine troy ounces x reference price
Convert grams to troy ounces before multiplying. For alloyed products, use fine content rather than gross weight. Keep the reference time beside the calculation.
Build delivered cost
delivered cost = merchandise + payment charge + tax + shipping + insurance + required fees
The advertised price may assume a large quantity or bank transfer. Use the actual order size, payment method, and destination.
Express premium two ways
premium dollars = delivered cost - metal reference
premium rate = premium dollars / metal reference x 100
Dollar premium shows cash cost. Percentage premium makes products with different metal values easier to compare.
The mechanism behind the premium is not unique to metal. An SEC investor bulletin on how fees and expenses affect a portfolio describes a markup as what a dealer takes by selling from its own inventory at a price higher than the market price, and a markdown as what it takes by buying from you at a price lower than that. A bullion dealer's ask and bid work the same way, which is why the purchase premium and the buyback discount are two halves of one charge rather than two unrelated numbers. That bulletin covers securities, so borrow the mechanism and not the regulatory protection it describes.
Calculate the exit
Ask a credible buyer for a current bid on the exact product, quantity, package, and condition. Deduct shipping, insurance, testing, assay, auction, consignment, payment, or other sale charges.
net exit = gross bid - sale costs
round-trip gap = delivered cost - net exit
The gap shows how far the transaction begins below break-even. It can change even when spot does not because retail premiums and bids move independently.
Separate price layers
| Layer | Meaning |
|---|---|
| Benchmark or spot | Defined wholesale reference |
| Fabrication premium | Cost tied to making the format |
| Distribution and dealer margin | Supply-chain and business cost |
| Payment and fulfillment | Method, shipping, insurance |
| Tax | Jurisdiction and transaction facts |
| Product premium | Recognition, scarcity, or collector demand |
| Exit deduction | Buyer margin, test, condition, and sale cost |
Compare identical conditions
Two quotes are comparable only when product, quantity, time, payment, destination, package, and delivery are aligned. A random-year coin is not the same as a selected-year proof. A card quote is not a wire quote.
Avoid false precision
Market prices move while a checkout is open. Product weights and conversions may round. State assumptions and do not present a multi-decimal break-even as a guaranteed executable price.
Common questions
Is spot the price a dealer must pay me?
No. A dealer sets a product-specific bid subject to market and transaction conditions.
Can premium be negative?
Yes. A product can be offered or bid below a reference, depending on condition, inventory, and market.
Does free shipping remove delivery cost?
It removes a separate charge, but the expense may be embedded in merchandise price.
What is the best break-even measure?
Compare delivered cost with a realistic net bid, then update both before making a decision.
