Here are more common questions about Gold investment around the world
Yeah, sounds really cool. Frequently asked questions for gold business.
Investment vehicles of Gold
The most traditional way of investing in gold is by buying bullion gold bars. In some countries, like Canada, Austria, Liechtenstein and Switzerland, these can easily be bought or sold at the major banks. Alternatively, there are bullion dealers that provide the same service. Bars are available in various sizes. For example in Europe, Good Delivery bars are approximately 400 troy ounces (12 kg).1 kilogram (32 ozt) are also popular, although many other weights exist, such as the 10oz, 1oz, 10 g, 100 g, 1 kg, 1 Tael, and 1 Tola.Bars generally carry lower price premiums than gold bullion coins. However larger bars carry an increased risk of forgery due to their less stringent parameters for appearance. While bullion coins can be easily weighed and measured against known values to confirm their veracity, most bars cannot, and gold buyers often have bars re-assayed. Larger bars also have a greater volume in which to create a partial forgery using a tungsten-filled cavity, which may not be revealed by an assay.Good delivery bars that are held within the London bullion market (LBMA) system each have a verifiable chain of custody, beginning with the refiner and assayer, and continuing through storage in LBMA recognized vaults. Bars within the LBMA system can be bought and sold easily. If a bar is removed from the vaults and stored outside of the chain of integrity, for example stored at home or in a private vault, it will have to be re-assayed before it can be returned to the LBMA chain. This process is described under the LBMA's "Good Delivery Rules".The LBMA "traceable chain of custody" includes refiners as well as vaults. Both have to meet their strict guidelines. Bullion products from these trusted refiners are traded at face value by LBMA members without assay testing. By buying bullion from an LBMA member dealer and storing it in an LBMA recognized vault, customers avoid the need of re-assaying or the inconvenience in time and expense it would cost.[51] However this is not 100% sure, for example, Venezuela moved its gold because of the political risk for them, and as the past shows, even in countries considered as democratic and stable, for example in the USA in the 1930s gold was seized by the government and legal moving was banned.Efforts to combat gold bar counterfeiting include kinebars which employ a unique holographic technology and are manufactured by the Argor-Heraeus refinery in Switzerland.
Gold futures investment
Trading gold futures contract
well,threr are many kind of financial products can be traded on the Internet or off the Internet.But I don't see much threads about gold futures.So I'd like to
what I know about it.But before we get started,we need to know:
What Are Precious Metals Futures Contracts?
A precious metals futures contract is a legally binding agreement for delivery of gold or silver in the future at an agreed-upon price. The contracts are standardized by a futures exchange as to quantity, quality, time and place of delivery. Only the price is variable.
Hedgers use these contracts as a way to manage their price risk on an expected purchase or sale of the physical metal. They also provide speculators with an opportunity to participate in the markets without any physical backing.
There are two different positions that can be taken: A long (buy) position is an obligation to accept delivery of the physical metal, while a short (sell) position is the obligation to make delivery. The great majority of futures contracts are offset prior to the delivery date. For example, this occurs when an investor with a long position initiates a short position in the same contract, effectively eliminating the original long position.
Gold Futures
Gold Futures
Gold is traded in dollars and cents per ounce. For example, when gold is trading at $600 per ounce, the contract has a value of $60,000 (600 x 100 ounces). A trader that is long at 600 and sells at 610 will make $1,000 (610 – 600 = $10 profit, 10 x 100 ounces = $1,000). Conversely, a trader who is long at 600 and sells at 590 will lose $1,000.
The minimum price movement or tick size is 10 cents. The market may have a wide range, but it must move in increments of at least 10 cents.
Both the eCBOT and COMEX specify delivery to New York area vaults. These vaults are subject to change by the exchange.
The most active months traded (according to volume and open interest) are February, April, June, August, October and December.
To maintain an orderly market, the exchanges will set position limits. A position limit is the maximum number of contracts a single participant can hold. There are different position limits for hedgers and speculators.
Though I have read few books on gold investment but this information is very good and helpful though.
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Here are more common questions about Gold investment around the world
Q11:Can I close out all positions in a single transaction?
A: Yes, you can close out all positions at the same time. Click the "Close All" button (or select all),and then click "close". Or you can double-click the lots and modify the value for partial close. The "Close All" button is not available in MT4 platform.
Q12:What is Spread?
A: The spread refers to the difference between the bid and ask price. The spread of LLG is US$0.5.The contract unit of Loco London Gold is ounce and about 100 ounces per lot, thus, the spread for trading one lot of LLG will be 0.5*100=US$50. Bid-ask spread of LLS is US$0.04.The contract unit of Loco London Silver is ounce and 5000 ounces per lot, thus, the spreads for trading one lot of LLS will be 0.04*5000=US$200.
Please contact our customer service for spread offer details.
Q13:How can I know the spread has been charged?
A: The bid and ask price of LLG has a difference of US$0.5. When buy/sell to build a position, the position will close based on the bid/ask price. When trading one lot, the "profit/loss" column of the order shows a -50 which refers the spread has been charged.
Q14:How many points of the minimum tick size of LLG?
A: Rise or fall one pip in each bounce of LLG refers that the price goes up or down by US$0.1 per ounce in GEG platform, while US$0.01 in MT4 platform.
Q15:What is margin?
A: Margin refers to the certain amount of capital required for trading of LLG/LLS as a certificate of holding the orders. The margin requirement for LLG is US$1000 per lot, For instance Gold Jinyu. The margin requirement for LLS is US$2000 per lot.
After closing quotation in Friday night(GMT+8) the margin for LLG is 2000USD/lot, the margin for LLS is 4000USD/lot, in order to copy with the wild market fluctuation when the market opens.
Q16:What is the minimum margin level?
A: When holding an unsettled position, the margin may decrease as a result of floating loss. The margin level must remain at above 10% of the initial margin.
Q17:What is leverage?
A: Leverage ratio can be used to measure the magnification of "small broad". The calculation formula of leverage: Market price*contract unit/margin requirement=leverage. For example: if the market price of gold is 1315.00, the leverage=1315.00*100 ounces/1000=131.5 times.
Q18:What is explosive position?
A: Under certain special conditions, the balance in the margin account of an investor is negative. When the market has big changes, if the capitals in the investor's margin account have been used as trading margin, and the trading direction is going against the market trend, , For instance Gold Jinyu.because of the leverage of the margin, the position will be locked. The position will explosive because of the change of market and overnight interest.
Q19:What are the Trading hour and clearing hour?
A: Trading hour for spot products(Beijing Standard Time):
From 08:00 on Monday to 03:00 on Saturday(summer)
From 08:00 on Monday to 04:00 on Saturday(winter).
The trading hour for Hong Kong stock exchange is in a time period specified by HKSE. Please visit the official website of the Hong Kong Stock Exchange for details. We provide 24 hours a day service in our platform.
Clearing hour:03:00-03:15 (summer)04:00-04:15 (winter) The trading is suspended and interests is for delivery during this time period.
Q20:What is reorder?
A: Limit orders/pending orders can not be used for reorder purpose, that is when the market price rises, place pending orders to buy new orders or sell limit orders(increase the buy orders) is not allowed. On the contrary, when the price falls, place pending orders to sell or to buy limit orders(increase the sell orders) is not allowed. The orders will be automatically cancelled by the system, For instance Gold Jinyu.. whether close the positions or place new orders, stop-loss price/advantaged pending order can not be executed when the market price rises /falls. That is, it can not be used for reorder purpose, but can be used for close or lock the position.