Glossary with Definitions of Precious Metals Terms
Definitions of some common precious metals terms.


ASK: a coin or bar’s selling price.

BID: a coin or bar’s buyback price.

BULLION: platinum, gold or silver in the form of bars, coins or ingots.

BREAK EVEN: the percentage gain a coin or bar’s bid price must increase to equal the original ask or selling price.

Break Even = (Ask – Bid)/Bid

MELT VALUE: the value of a coin or bar. The Melt Value is calculated by the amount of metal multiplied by the spot price of the metal. For example, if a coin contains one ounce of gold and the spot price is $1,500 per ounce, the melt value of the coin is $1,500.

OBVERSE: the front or "heads" side of a coin.

PREMIUM: the amount charged above a coin or bar’s melt value.

REVERSE: the back or "tails" side of a coin.

SPREAD: the difference between a coin or bar’s ask (selling) price and its bid (buyback) price. For example, if a coin’s ask price is $1,000 and its bid price is $720, the spread is $280 or 28 percent. The spread is different from the markup.

Spread = (Ask – Bid)/Ask

SPOT PRICE: a market indicator that essentially reflects the price paid for a precious metal based upon immediate delivery.  It can be construed as the theoretical value of the metal before converted into a bar or coin.