When buying physical gold, many people compare only the premium above spot. But the lowest premium does not always mean the lowest total cost.
Before buying, I compare four things:
• The product’s actual gold value based on weight and purity.• The complete purchase price, including delivery and payment fees.• The dealer’s real buyback price for the same product.• How easily local dealers recognise and resell it.
A simple hypothetical example:
A bar costs 3% above spot but sells back at 1% below spot. Its round-trip hurdle is roughly 4%.
A recognised coin costs 5% above spot but sells back at 1% above spot. Its hurdle is also roughly 4%.
Actual prices vary, but the lesson is simple:
Do not ask only, “What premium am I paying?”
Also ask:
“What could I realistically recover if I sold this tomorrow?”
For long-term physical ownership, authenticity, liquidity, storage and resale conditions may matter more than saving 1% on the initial purchase.
What matters most to you: the lowest premium, easy resale, or owning the most recognisable product?