Allocated Storage

A precious metals custody arrangement in which specific, identified bars are legally assigned to the account holder — fully segregated from the custodian's assets and not available for lending or rehypothecation.

In allocated storage, the custodian (a bank, vault operator, or specialist metals firm) holds specific, individually identified bars that are the unambiguous legal property of the account holder. Each bar is listed on the account statement by serial number, weight, and assay. These bars cannot be lent out, used as collateral, or otherwise encumbered by the custodian. If the custodian becomes insolvent, allocated metal should not be available to creditors — it is already the legal property of account holders, not an asset of the firm.

Allocated storage is the gold standard for precious metals custody. It eliminates counterparty risk in the most meaningful way: your gold is your gold, not a promise from a financial institution. Major allocated storage providers include the Brinks and Malca-Amit vault networks, Loomis International, and specialist vault operators in Singapore, Zurich, and London.

The cost — typically 0.1–0.25% per annum for gold, higher for silver due to lower value density — reflects segregated custody and insurance. The premium over unallocated storage is worth it for investors who take wealth preservation seriously, because the risk being eliminated — custodian insolvency during exactly the type of financial crisis when you most need your holdings — is precisely the scenario you are holding precious metals to protect against. When evaluating any precious metals custody arrangement, the single most important question is: "Is this allocated or unallocated?"

This definition is for informational and educational purposes only. Nothing on Finance Compass constitutes financial, investment, or trading advice. Always conduct your own research and consult a qualified professional before making financial decisions.