Investing incan be a compelling opportunity for the right investor, as the precious metal has a long history of lessening risk in investment portfolios. And, gold's value has historically increased during inflationary periods, so investing in gold can be a smart way to hedge against inflation.
Moreover,asset because the price is generally not impacted either positively or negatively by the stock market. For example, when the stock market faces a downturn, many investors add gold to their portfolios, increasing the demand for the precious metal, and, as a result, its value.
But what if you want to? Gold bars are one way to invest in the commodity, but how much money are they worth?
How much is a gold bar worth?
come in different weights and the price is generally based on how much each bar weighs. For example, gold bars that weigh one troy ounce are less expensive than gold bars weighing 10 troy ounces. So, it's important to look at the current gold price to determine how much a gold bar is worth.
is about $2,029.67 per ounce as of December 8, 2023. That means you can likely sell gold bars for the following prices, though it varies by dealer:
- 1-ounce gold bar: $2,029.67
- 10-ounce gold bar: $20,296.70
However, that doesn't necessarily mean you can buy gold bars for this price. After all,need to make money, too. They typically do so by charging a fee on top of the spot price. This broker fee usually decreases on a per-ounce basis when you purchase higher volumes of gold. So, if you plan on buying gold bars, remember that volume-based discounts can make a big difference in the per-ounce fees you pay.
For example, JM Bullion listed their lowest-cost 1-ounce and 10-ounce gold bars as of December 8, 2023, as follows:
- Lowest-price 1-ounce gold bar: $2,090.35 ($60.68 broker fee per troy ounce over spot)
- Lowest-price 10-ounce gold bar: $20,410.20 ($11.35 broker fee per troy ounce over spot. $113.50 total over spot)
It's worth noting that other factors may play a role in the price of a gold bar. Purity, collectability and the cost of manufacturing can also have an impact on cost. For example, here are the prices for the most expensive gold bars listed on JM Bullion's website:
- Highest-price 1-ounce gold bar: $2,249.32, or about $158.97 more than the lowest-price 10-ounce gold bar
- Highest-price 10-ounce gold bar: $21,134.10, or about $723.90 more than the lowest-price 10-ounce gold bar
Both higher-priced gold bars come from Swiss manufacturers known for high-quality collectible designs, which likely helped to drive the price increase.
How much of your portfolio should you allocate to gold?
"Determining the amount of gold you should invest in depends on your goals, risk tolerance, time horizon and investment strategy," says Derek Miser, investment advisor and CEO at Miser Wealth Partners. "There's no right answer, as the amount can vary from one investor to another."
"Some financial experts recommend gold allocations ranging from 2% to 10% or more of a portfolio, but these recommendations vary widely," Miser says. "The right allocation to gold should reflect an investor's unique financial situation, and it may change over time as their investment circumstances evolve."
As such, if you're unsure of, it may help to reach out to a financial advisor, who can assess your unique situation and provide guidance based on your goals, risk tolerance and other factors.
Three common ways to invest in gold
If you're considering an investment in gold, three common options are:
- Physical gold: You have the option to , and there are numerous online precious metals marketplaces where you can buy and sell gold.
- Gold ETFs: Exchange-traded funds (ETFs) offer a low-cost way to gain exposure to stocks, bonds, commodities or a mix. When you , you're typically tapping into a diversified portfolio of gold investments.
- Gold IRAs: You can also . This allows you to invest in the precious metal while taking advantage of associated tax breaks.
The bottom line
The amount of money a gold bar costs largely depends on the size of the bar and the spot market price at the time of the sale, as well as other factors, like purity. Keep in mind, though, that the gold spot price regularly changes, so it's important to stay up-to-date to determine whether it's the right time to buy or sell gold bars.
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