Price of Precious Metals - Just how many different prices are out there?
Precious metals prices have been on the decline over the last year but still remains at record highs. This has caused many investors to flock to these assets in hopes of making a quick profit. However, there are a few things to consider before investing in precious metals. First, it is important to understand that prices can be volatile and may not always continue to rise but when they do move, they fly high.
As Golds price is a multiple of Silver it tends to plod along in single percentage terms but when it moves Silver catches its coattails and soars past Gold in double digit percentage terms. Platinum Group Metals are Noble metals and are part of the industrial complex and so the fundamentals of price action in PGM’s can differ greatly, but they tend to follow Gold and Silver in terms of price trajectory.
Where can you find Precious Metals Prices?
It truly depends on your own personal investment needs really, many have flocked to the Kitco GOLD LIVE!™ over the years as it provides an indicative price but the spread is $1 wide for Gold and spot prices are more like 20 cent spreads in reality but that obviously does not come with a physical delivery price. So, it really depends on your own preferences. They also have their Gold Charts pricing on their website with banners like this one on the right provided by www.kitco.com.
- Bullion Dealers Precious Metals Price – Every precious metals dealer worth his salts has their own charting with live pricing on their website, nothing wrong with checking that but it would be advisable to have multiple pricing tools open when getting a precious metals price from your bullion dealer.
- Bloomberg Precious and Industrial Metals provides Futures closing price, so that’s static, if you have over USD2k to burn a month for an overpriced email system feel free to sign up for their Blomberg Terminal.
- Reuters offers the Gold Spot XAU=X pricing with some added news thrown in!
The Gold Price Fix!
There has been a lot of controversy over the years based on some of the names listed (see also London Gold Pool before that) below in the settlement of the Gold Fix so the LBMA decided to change the name to protect the innocent to LBMA Gold Price, LBMA Silver Price, LBMA Platinum Price, LBMA Palladium Price. Third times a charm!
Here are the 5 Names that use to decide the London Gold Fix and some links to issues related to potential gold price manipulation which hints to the change of name away from London Gold Fix.
1. Scotia-Mocatta (getting out of the gold business).
2. Barclays Capital – Moving away from bullion but remains in ETFs.
3. Deutsche Bank (Claims to be out of the gold business but is back in quietly).
4. HSBC Bank – The biggest bullion dealer alongside JP Morgan.
5. Société Générale – Resigned as Market Maker.
Media articles on Gold Price Manipulation
US probing big banks on possible metal price rigging
UBS, Deutsche Bank and HSBC to pay millions in spoofing settlement, CFTC says
Goldman, BASF, HSBC accused of metals price fixing – U.S. lawsuit
Scotiabank to pay over $127 million for precious metals price manipulation
Barclays gives informatin to US precious metals probe
And the list of media claims goes on and on, see also my article Gold Friggin’ in the Rigging to hear of the latest escapades in precious metals price manipulation! At no point did the LBMA remove the above names from their membership unlike other members who were removed based on an accusation, which begs the question can the old boys club be trusted?
What time is the Gold Price Fix?
It’s hard for the gold industry that know these players well enough to shake off the old name, so the gold price fix is taken twice daily, at 11am and 3pm.
The LBMA are of course well known as a conference organiser but they are also the ones also provide international precious metals benchmark settlement pricing globally for the LBMA Gold Price and LBMA Silver Price and it’s administered independently by ICE Benchmark Administration (IBA) and the LPPM settles the pricing for the platinum group metals (PGM’s).
Sixteen firms are direct contributors to the LBMA Gold Price.
Bank of China
Bank of Communications
Citibank, N.A. London Branch
Coins ‘N Things Inc.
DRW Investments, LLC
Goldman Sachs
HSBC Bank USA NA
Industrial and Commercial Bank of China (ICBC)
Jane Street Global Trading, LLC
JPMorgan Chase Bank, N.A. London Branch
Koch Supply and Trading LP
Marex
Morgan Stanley
Standard Chartered Bank
StoneX Financial Ltd
Toronto-Dominion Bank
What's the Difference between the LBMA and the LME in Gold?
Some people get confused between the LBMA and the LME and easy mistake to make if you are detached from the industry like many of the Gold Joker Brokers on LinkedIn and for a while the LME did have a precious metals suite of products apply named LMEPrecious but due to the fact JP Morgan and HSBC did not get involved with LMEPrecious and some other internal issues at the LME it did not get off the ground and was defunct on the 11th July 2022!
Independent data on Precious Metals Prices
We use TradingView ourselves, they have a handy app and desktop version which is much more flexible in terms of charting. They have a Free and Pro version to choose from, with Pro starting at USD10+ per month.
The Gold chart below is priced in Singapore Dollars to reflect our local market pricing but you can choose the currency of your choice!
Do Gold ETFs reflect the price of Precious Metals?
In my personal opinion precious metals are not truly reflected by ETF’s and I always advise people to use them sparingly when part of their precious metals investment strategy and that is me talking in my personal capacity not a professional one.
While investors can easily purchase gold in the form of bullion or coins, a gold exchange-traded fund (ETF) seems to be a more convenient and accessible alternative that can be used with any brokerage account. The apparently cheap to invest in Gold ETF’s have been a way that many non-Physical gold investors have taken advantage of the low fees and zero storage but fail to realize the costs are all imbedded in the price they pay to get in and get out on the spread.
When investing in Gold ETFs you also have counterparty risk to consider, here are the Top 5 Gold ETFs to consider but take note that Bear Stearns were one of the largest precious metals market players before their collapse.
Top 5 Gold ETFs
- iShares Gold Trust – IAU (owned by Blackrock) – Exposure to LBMA pricing.
- SPDR Gold Shares – GLD (owned by State Street Global Advisors) The gold bullion is held by the Custodian, HSBC Bank USA N.A., in its London vault or in the vaults of sub-custodians.
- Aberdeen Physical Gold Shares ETF – SGOL – (owned by Abrdn plc, formerly Standard Life Aberdeen plc), here is their own disclaimer, make of that what you will: Investors should carefully consider a fund’s investment objectives, risks, fees, charges and expenses before investing any money.
- GraniteShares Gold Trust – BAR – ICBC Standard Bank PLC are the Custodian with Gold held in London – Read the prospectus, especially Fees.
- ProShares Ultra Gold – UGL (owned by the ProFunds Group), not a true reflection of the physical gold price, see their website for more details.
What are current Precious Metal Prices?
This type of question is like How long is a piece of string? or Who scored the goal? But trust me people actually Google that term! See TradingView Chart above!
Which Precious Metal has the highest value?
The simple answer is Rhodium! Rhodium hit an all-time high of $29,800 in March 2021.
Are Precious Metals a good investment right now?
As of November 2022, the global situation is on the precipice of a meltdown with many of the central banks trying to juggle the amount of money they have flooded the system with by raising interest rates while the stock market melts down and sits on the edge of a recession and they have been stockpiling gold!
War in Ukraine, China and Taiwan in peoples minds of a takeback and the Central Banks looking to roll out Digital Currencies like there is no tomorrow! So my best answer here is Yes, go get yourselves some precious metals whilst you still can!
What Precious Metal is best to buy?
A balanced precious metals portfolio is as important as the entire investment portfolio you have across Equities and Bonds. Gold has been a 10% of your overall portfolio strategy for many advisors but I have always considered 20% to be a better holding but to mix that 20% up you can add Silver alongside along with some PGM’s especially Platinum and Palladium especially in light of their global use in renewable energy products, catalysts and electronics.
What are the 10 most valuable Precious Metals?
- Rhodium
- Platinum
- Gold
- Ruthenium
- Iridium
- Osmium
- Palladium
- Rhenium
- Silver
- Indium
Why are Precious Metal Prices falling? (November 2022)
- The price of precious metals has decreased from its first quarter highs. Inflation concerns have been overcome by higher interest rates and a stronger U.S. currency, which explains the recent decline.
- Gold prices have remained largely stable due to strong central bank purchases, but were nonetheless dragged down by weak consumer and investor demand.
- Reduced demand from industry contributed to a fall in silver prices.
- Low demand for autocatalysts caused platinum prices to plummet.
- The influence of the conflict in Ukraine has been seen in the unusual volatility of palladium prices.
Should I buy Silver or Gold 2023?
Buy less Gold and More Silver is my suggestion but if all you can afford based on Gold price then just buy Silver!
Read this slightly older article LBMA delegates predict gold price will rise to $1,830.50 in a year then make your own mind up!
What is the best Precious Metal to invest in 2023?
See above, Silver will outshine Gold in 2023 (pun intended)
If you don’t trust my judgement take a look at this article: LBMA delegates see silver prices rallying 54% in the next 12 months
*Disclaimer The author of this article is not liable for any financial loss that may occur as a result of any investment made in accordance with any apparent suggestion, forecast, or any other information included within this post.
Spencer Campbell
Director SE Asia Consulting - Precious Metals Consultant
