Glossary

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Ag - The chemical symbol for silver.

Alloy - A substance composed of two or more metals.

Allocated Metal - Assigning defined quantities of physical metals to specific accounts. For example, if an investor buys shares in a gold exchange-traded fund, each share is backed by a defined amount of physical gold.

Approved Carriers - An exchange-authorized armored carrier approved for the transport of precious metals.

Ask - The price which the seller is willing to accept for a commodity; also known as the offer price.

Assay - The act of testing the purity of precious metals.

Au - The chemical symbol for gold.

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Bank Wire - An electronic transfer of funds through the Federal Reserve System from one financial institution to another for the benefit of a specific account.

Base Metal - Copper, aluminum, iron, lead, nickel, tin and zinc.

Bear Market - Market characterized by a declining trend in terms of prices.

Bid - The bid price is the price at which a dealer is willing to buy a commodity; opposite of "ask".

BU - Brilliant uncirculated, used to describe a coin in new condition.

Bullion - Precious metals, including gold, silver, platinum, and palladium, that are traded based on their intrinsic metal value.

Bullion Coin - A precious metal coin whose market value is determined by its inherent precious metal content. They are bought and sold mainly for investment purposes.

Bull Market - Market characterized by upwardly moving price trend.

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Call - The right, but not an obligation, to buy a commodity or a financial security on a specified date in the future.

Canadian Maple Leafs - Modern bullion coins minted by the Royal Canadian Mint.

Carrying Charge - The cost associated with holding a financial instrument or storing a physical commodity over a defined period of time.

Cash - U.S. currency.

Cash Market - The market for a cash commodity where the actual physical product is traded.

Cashier's Check - Check drawn by a bank with its own funds and signed by its cashier.

Central Bank - The entity responsible for establishing a nation's monetary and fiscal policy and controlling the money supply and interest rates. In the U.S., the Federal Reserve Board is often referred to as the Central Bank.

Close - The official end of a trading session.

Coin - A stamped piece of metal of a known weight and fineness issued for commerce.

Coin of the Realm - A legal tender coin issued by a government, meant for general circulation.

Comex - One of the world's major commodities futures exchanges where gold and silver are traded. The Comex is in New York City and is a division of the New York Mercantile Exchange.

Commemoratives - Legal tender coins or medallions usually minted of gold or silver to commemorate themes, events, places, or people.

Commission - The fee charged by a broker for the execution of an order.

Correction - A decline in prices following a rise in a market.

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Deliverable Bar - A precious metals bar with a weight, fineness and hallmark approved as a tradable unit on a commodity exchange.

Delivery - The exchange by which an underlying commodity, cash, or other delivery instrument is tendered and received by the contract holder.

Delivery Point - A location designated by an exchange at which delivery may be made in fulfillment of contract terms.

Depository or Warehouse Receipt - A document issued by a depository institution indicating ownership of a commodity stored in a vault or warehouse.

Double Eagles - U.S. $20 gold coins used as legal tender 1850-1933. Double Eagles contain .9675 ounce of gold and come in two designs: the St. Gaudens (Walking Liberty) and the Liberty.

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Face Value - The monetary value of an investment coin, which does not necessary correspond to its actual worth. For example, the face value of a gold American Eagle one-ounce coin is $50, but its actual worth is tied to the spot value of its gold content a much higher value.

Fiat Money - Paper money made legal tender by law, although not backed by gold or silver.

Field - The open area or background on a coin.

Fineness - The purity of precious metal measured in parts per thousand. A "Good Delivery" bar contains a least 995 part pure gold and no more that 5 parts other metals or impurities. Many gold and silver bullion products, such as the original gold Maple Leaf coins are 99.99% pure gold and are often described as being struck from .9999-fine gold. Example: the American Gold Eagle is .9167 fine, which means it is 91.67% gold. A Canadian Maple Leaf has a fineness of .999, meaning that it is 99.9% pure.

Fine Silver - Pure silver. Generally 99.9% pure.

Fine Weight - The weight of precious metal contained in a coin or bullion as determined by multiplying the gross weight by the fineness. The metallic weight of a coin, ingot, or bar, as opposed to the item's gross weight, which includes the weight of the alloying metal. Example: a 1-oz Gold Eagle has a fine weight of one troy ounce, but a gross weight of 1.0909 troy ounce.

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Gold - A soft, shiny, heavy, malleable,and highly ductile transition metal that has long been used as a store of wealth and a standard for currencies worldwide. For centuries, gold has been used in coinage, jewelry, and in countless industrial applications.

Gold Eagles - Modern gold bullion coins.

Gold Standard - A monetary system based on convertibility into gold; paper money backed and interchangeable with gold.

Gold/Silver Ratio - The number of ounces of silver required to buy one ounce of gold at current spot prices.

Good Delivery Bar - A bar of gold or silver that is acceptable for delivery against a metals contract.

Grading Service - A company that grades numismatic coins. Generally, graded coins are encapsulated in plastic, a procedure called "slabbing". PCGS and NGC are the two dominant grading services in the United States.

Grain - The earliest weight unit for gold. One troy ounce contains 480 grains.

Gram - The basic unit of weight of the metric system. (31.1035 grams = one troy ounce.)

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Hallmark - A stamped impression on the surface of a precious metals bar that indicates the producer, serial number, weight, and purity of metal content.

Hedge - An investment made as a strategy to mitigate risk of adverse price movements in a given asset. A transaction initiated with the specific intent of protecting an existing or anticipated physical market exposure from unexpected or adverse price fluctuations.

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Intrinsic Value - The actual value of the precious metals contained within a bullion bar or coin.

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Karat - A measure of the purity of precious metal. Pure gold is 24-karat.

Kilo Bar - A bar weighing one kilogram (32.1507 troy ounces).

Kilogram - 1,000 grams (32.1507 troy ounces).

Koala - Australian platinum coin, minted since 1987,.995 fine.

Krugerrand - South African gold coin.

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Legal Tender - In the U.S., coins and paper currency that have been authorized by Congress for the payment of debts owed. This includes circulating coins and all commemorative coins.

Legend - The inscription on a coin.

Liquidity - The quality of being readily convertible into cash.

Liquid Market - A market characterized by the ability to buy and sell with relative ease.

London Fix Price - This price is set each day in London by five old-line firms. The "fixing price" reflects the price at which buy and sell orders from the firms' customers' are in balance. The London Fix is an internationally recognized benchmark price for that particular moment in time.

Luster - A frosty appearance on the surface of a coin, usually an uncirculated coin.

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(Canadian) Maple Leafs - Modern gold, silver, and platinum coins minted by the Royal Canadian Mint.

Malleable - Allowing change in form under pressure or hammering without rupture or fracture.

Market Value - The total price of a bullion bar or coin inclusive of intrinsic value and any premium or discount.

Medallion - A round piece of metal resembling a coin but not a "coin of the realm." A medallion may be issued by a government or private mint. The Engelhard 1-oz Silver Prospector is a privately-minted medallion.

Metric Ton - 1,000 kilograms or 32,151 troy ounces.

Mint Mark - A letter or symbol stamped on a coin to identify the minting facility where it was struck.

Mint State - Describes a coin in uncirculated condition.

Modern Issues - Current coins, whether struck for circulation or for sale to investors or collectors.

Money Order - Order for the payment of a specified amount of money, usually issued and payable at a bank or post office.

MS-60 - The lowest grade of Mint State coins. Higher-grade coins are labeled MS-61 up to MS-70. Coins showing wear are graded below MS-60 and fall into grades from AU down to G, with G being a coin showing great wear and AU being a coin showing little wear.

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Obverse - The front side of a coin which contains the principal design.

Offer - A motion to sell a commodity at a specified price. Opposite of bid. The Offer price is the price at which a dealer offers to sell a commodity.

Ounce - A unit of weight. In the precious metals industry, an ounce means a troy ounce equal to 31.1035 grams.

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Palladium - A rare silver-white metal of the platinum group. Palladium resembles platinum chemically and is extracted from some copper and nickel ores. It is primarily used as an industrial catalyst and in jewelry.

PCGS - Acronym for Professional Coin Grading Service, one of two major coin grading services in the United States.

Pd - The chemical symbol for palladium.

Pennyweight - An American unit of weight for gold, in which one pennyweight equals 24 grains or 1/20 of a troy ounce.

Personal Check - A bank draft drawn on an individual account or a company account and signed by an authorized person.

Physicals Market - A marketplace in which the physical product is traded, as opposed to a futures market where "contracts" are traded and physical delivery of the product may or may not take place.

Planchet - A blank piece of metal used for stamping a coin or medallion.

Platinum - A chemical element in the periodic table that has the symbol Pt and atomic number 78. A heavy, malleable, ductile, precious, gray-white transition metal, platinum is resistant to corrosion and occurs in some nickel and copper ores along with some native deposits. Platinum is used in jewelry, laboratory equipment, electrical contacts, dentistry, and automobile emissions control devices.

Platinum Eagles - Modern platinum bullion coins minted by the U.S. Treasury.

Premium - The market value of a coin less the intrinsic value of its metal content. Premiums are set by issuing authorities (e.g., U.S. Mint) and/or bullion dealers and vary by product. The dollar amount or percentage a coin sells over its intrinsic value.

Proof - A coin produced using special dies and planchets that results in a sharpness of detail and a virtually flawless surface, usually mirror-like fields. Proof coins are produced for the collector market.

Pt - The chemical symbol for platinum.

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Securities and Exchange Commission (SEC) - An independent governmental agency that administers federal securities laws and regulates the firms that buy and sell those securities.

Settlement Price - The price established by the Exchange settlement committee at the close of each trading session as the official price to be used by the clearinghouse in determining net gains or losses, margin requirements, and the next day's price limits. The term "settlement price" is often used as an approximate equivalent to the term "closing price." The close in futures trading refers to a brief period at the end of the day, during which transactions frequently take place quickly and at a range of prices immediately before the bell. Therefore, there frequently is no single closing price, but a range of prices. In months with significant activity, the settlement price is derived by calculating the weighted average of the prices at which trades were conducted during that period.

Silver - A chemical element in the periodic table that has the symbol Ag (from the traditional abbreviation for the Latin Argentum) and atomic number 47. A soft white lustrous transition metal, silver has the highest electrical and thermal conductivity of any metal and occurs in minerals and in free form. This metal is used in coins, jewelry, tableware, and photography.

Spot - Term which describes one-time open market cash transaction, where a commodity is purchased "on the spot" at current market rates. Spot transactions are in contrast to term sales, which specify a steady supply of product over a period of time.

Spot Market - A market of immediate delivery of product and immediate payment.

Spot Month - The futures contract closest to maturity. The nearby delivery month.

Spread - The difference between the bid price and the ask price of a bullion bar or coin.

Sterling Silver - Silver of a fineness of 92.5%.

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Troy Ounce - The Troy ounce is the traditional unit weight for precious metals, believed to be named after a weight used at the annual fair at Troyes in France in the Middle Ages. Conversion: 1 Troy ounce = 480 grains = 31.1035 grams = 1.09711 avoirdupois ounces.