Bullion

Precious metal — primarily gold or silver — in bulk physical form (bars, ingots, or coins) valued by weight and purity rather than face value, collectibility, or industrial application.

"Bullion" refers to gold, silver, platinum, or palladium in refined physical form — typically cast or stamped bars, or government-minted coins valued at or close to their metal content. A South African Krugerrand, an American Gold Eagle, and a 400-troy-ounce London Good Delivery gold bar are all bullion: their value derives from what they are (refined metal of verified purity) rather than what they represent (a numismatic collectible) or what they can do (an industrial input).

The bullion market divides broadly into retail and wholesale. Retail bullion — one-ounce coins, small bars — is sold by coin dealers, mints, and online precious metals retailers at premiums above spot that reflect fabrication, distribution, and dealer margin. Wholesale bullion — 400-troy-ounce gold bars meeting LBMA Good Delivery standards, 1,000-ounce silver bars — is the unit of the institutional market, traded between central banks, refiners, ETF custodians, and large dealers at spreads close to spot.

For the investor, the choice between bullion forms matters. Coins carry higher premiums than bars but are more liquid at the retail level — a one-ounce gold coin can be sold to any coin dealer anywhere; a 400-ounce bar requires an institutional buyer. Silver's lower per-ounce price means the percentage premium on small coins can be high (sometimes 15–25% over spot), a cost that must be recovered before the investment generates a return. Buying close to spot — in larger bars or well-established bullion coins during normal market conditions — minimizes round-trip transaction costs.

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.