Buying Bullion in Australia: A Step-by-Step Guide

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Guide to buying gold, silver and platinum bullion in Australia

For those who are new to buying bullion, it might look confusing at first to understand all the terms like spot price, premiums, allocated storage, unallocated metal, and buyback price. For Australians, the real issue would be what to compare before ordering.  

If one is searching for gold, silver or platinum then it is more easily done if it is done systematically. Below are some ways through which you could understand better about buying bullion in Australia.

Step 1. Decide Why You Are Buying Bullion

Start with your investment objective. While some people may need precious metals as an investment option for protecting their wealth, others would need the same for portfolio diversification and increasing their bullion stock.

Your choice of bullion type, its quantity, and form will largely depend upon your objective. For example, you will have more options when it comes to the selling of smaller bars/coins. Moreover, bigger coins could command a lower premium per gram.

Step 2. Choose Between Gold, Silver and Platinum

Gold, silver, and platinum have several characteristics that differ. One such feature is the recognition of gold, and it has a high value-to-weight ratio, hence easy to keep. Silver is cheaper in terms of cost compared to gold; hence, one can afford more silver with a small investment budget.

Apart from bullion, investors can also get exposure to other metal markets like platinum. In selecting, consider your budget, investment objectives, period in which you will hold onto it, and the place you will store it.

Step 3. Understand the Spot Price and Premium

The spot price is the actual price of the precious metal in the market. However, there are occasionally dealer, manufacturing and distribution costs added to the spot price of physical bullion, which is why it is usually priced higher than spot. Purchase price is the spot price plus the applicable premium.

There may be fast fluctuations in the prices of precious metals and the price quoted may not be constant from the research stage to the buying stage. The large bullion dealers keep on changing their prices in response to changes in the market. When making comparisons, do not just compare the quoted price. Consider the precious metal that comes at that price.

Step 4. Select the Right Bullion Product

There are many bars, coins, and rounds that buyers from Australia can select. In addition to the looks of the product, it is crucial to focus on other aspects when selecting the product.

Consider:

  • Purity and metal content
  • Weight
  • Manufacturer or mint
  • Product premium
  • Ease of resale
  • Availability
  • Potential storage requirements

If you are more interested in the investment value and the weight of the metal for which you are buying, you might prefer a standard bullion product to a collectible product with a higher premium.

Step 5. Choose a Reputable Bullion Dealer

The dealer you select is important. Be sure to find a transparent pricing model, with clear terms, secure payment options, consistent delivery options, and a buyback program.

Perth Bullion Exchange is a Perth bullion dealer that sells gold, silver and platinum and can be accessed online and in Perth. It also has information about storage and buyback programmes on its website. Make sure to check the dealer's current conditions, payment schedule, delivery arrangements, etc. before purchase, as well as conditions for the buyback.

Step 6. Decide How You Will Store Your Bullion

Once you start acquiring the bullion bars, the issue of security comes into play. This could be a professional storage vault, bank safe-deposit facilities or even suitable private storage facilities. Some dealers even have storage programs available.

Perth Bullion Exchange allows for storage for both the allocated and unallocated accounts. It gives three months free storage for the allocated account and removes the issues of storage and shipping charges in the unallocated account, thus allowing the investor to accumulate small amounts to a physical product.

Step 7. Understand the Buying Process

Once a product and a dealer have been selected, review the contract details before concluding on the deal.

Verify the following:

  1. Product description and its weight
  2. Purity of the product as well as its metallic type
  3. Price at which the product will be purchased
  4. Procedures for claiming the premiums and fees
  5. Delivery/changing fees
  6. Deadline for payment
  7. If any, describe the terms for storage
  8. Terms for cancellation and buyback by the dealers

For example, Perth Bullion Exchange allows orders to be placed either online or in person and usually payment is needed within two business days.

Step 8. Keep Your Purchase Records

Store all related documents, such as receipts, order confirmations, storage documentation and invoices in a safe place.

Ensuring that you have good recordkeeping helps you keep track of your holdings, set purchase costs, track future sales, and have a correct personal investment history.

Step 9. Understand How You Will Sell

Purchasing bullion is just half the task. When buying, be aware of the potential for a sale and where.

Check:

  • Dealer buyback prices
  • Buyback fees
  • Verification requirements
  • Accepted products
  • Payment timeframes

Once you understand the exit process, you are able to consider the cost of ownership of your system rather than just the up-front expense.

Step 10. Review Your Strategy Over Time

The timing of your order will be the start of your journey into the investment field of gold. Check on your portfolio from time to time to see whether they fit your financial objectives.

It is a decision that gives the option of paying it back in installments or even clearing it once and for all. Certain storing programs help investors buy precious metals gradually; this adds a new aspect to their investment style.

Buy Bullion with Greater Confidence

Knowing some of the fundamentals will make it easier to purchase bullion in Australia as you have to know your investment objective, learn about the products and their premiums, find a credible dealer, arrange for secure storage, understand the buyback arrangements, and keep good record-keeping.

Perth Bullion Exchange is committed to providing access to gold, silver and platinum products as well as flexible storage and buy-back facilities for bullion investors in Australia.

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