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The Trade Price Explained

What is the trade price of gold & silver?
Why is the trade price important?
How is the trade price determined?
I want to accept precious metals at my business. Why should I use the trade price?
I want to spend my gold and silver. Why should I suggest the trade price?
Why Does SchiffGold publish the trade price?
Embed the trade price on your website.

What is the trade price of gold & silver?

The trade price is a realtime reference price intended for precious metals barter transactions, i.e. spending or accepting gold and silver at a place of business or in a personal trade.

The trade price is fixed at:
Silver: Spot + 20%
Gold: Spot + 15%

 

Why is the trade price important?

Reason #1 – Previously, vendors accepting precious metals had no reference except the spot price, but the spot price is not meant for everyday transactions. Rather, it is the price that large institutional buyers pay each other for “paper” gold and silver stored in warehouses. No individual (or even major metals dealer) can reliably buy coins at spot price – so why should we have to spend them at spot?

Reason #2 – Each type and size of precious metals coin or bar carries its own premium in the marketplace. By agreeing on a set price per ounce for all gold and silver, it eases transactions and allows for vendors to return change to the customer in silver or gold!

Reason #3 – For customers who use larger coins or bars (.5 oz, 1 oz, or more), the trade price is effectively a discount for them to spend in precious metals rather than fiat money. The vendor gets real money without having to buy it from a dealer and builds customer loyalty with the sound money community.

How is the trade price determined?

The trade price was formulated to allow gold and silver to be transacted in denominations from fractions of an ounce to many ounces. Since fractional coins carry higher premiums, the trade price is set so that silver as small as 1/4 oz and gold as small as 1/10 oz can be spent without the customer incurring a loss from what they paid their metals dealer to purchase the coins. The trade price was carefully compiled using average premiums of a range of coins from the major precious metals dealers.

I own a business and want to accept precious metals. Why should I accept them at trade price?

For business owners, using the trade price saves you from haggling over the value of coins your customers want to spend. You can accept all silver bullion coins, regardless of size or type, at the silver trade price.

You can also make change in precious metals because 1/4 oz is literally 1/4 the price of 1 oz at trade price. This is how the coins in our pocket used to work: a dime was roughly 1/10 oz of silver, a quarter roughly 1/4 oz, a half dollar roughly 1/2 oz, and a silver dollar roughly 1 oz – and they were all interchangeable.

Since your customers must pay more than spot price to purchase their coins, they would be taking a loss to spend them at spot. The trade price incentivizes them to give you real precious metals instead of more fiat paper – and shows that you care about promoting sound money. You will win customers for life.

I’m a silverbug/goldbug and I want to spend my coins. Why should I suggest the trade price?

Precious metal barter transactions can be tough. Not only do you have to negotiate on the price of the item, but you also have to negotiate the value of your coins (relative to the dollar). Vendors often use the spot price because it’s what is readily available, but that means you lose the premium you spent to turn your dollars into metals in the first place. No wonder most people decide just to stack their metals and spend their dollars!

The trade price ensures that you get a fair price for your coins. It is designed to be a quick and easy reference point that allows bullion coins of all sizes and types to be bartered without haggling. Since the trade price is set so that you can spend coins as small as 1/4 oz of silver or 1/10 oz of gold without losing any of the premium you paid to purchase them, that also means you get a built-in discount if you spend larger coins!

What’s more, because the trade price is set for coins of all sizes, it makes it easy for vendors to give you change back in silver or gold – so you don’t have to touch that dishonest fiat currency at any point in the transaction.

The trade price is designed to get the silver and gold flowing freely. Suggest it to businesses and for personal trades, and you can help make sound money the backbone of your local economy. The vendors will thank you when the metals you spend with them hold their value over time, and you’ll thank yourself for earning a little discount every time you buy.

Why Does SchiffGold publish the trade price?

SchiffGold is a company of sound money enthusiasts. We want to see silver and gold become everyday money again. A couple of us actually barter metals on a regular basis for everything from coffee to electronics. So we know firsthand the difficulties of using real money in a culture that has forgotten how. Publishing the trade price is a public service offered to help ease precious metal barter transactions by offering a fixed reference price for silver and gold bullion that aligns incentives for vendors and customers. Our only interest is this: by making silver and gold easier to spend, we grow the market for precious metals buyers – and help put our country on a stronger economic footing.

Embed the trade price on your website:

SchiffGold has designed these handy, live trade price widgets for public use. Feel free to copy the embed codes below and install them on your own website.

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