A few beliefs about bullion circulate widely and cause real problems. Here are the ones that come up most often, and what is actually the case.
"The spot price is what I should pay"
Spot is a wholesale benchmark for unfabricated metal in large quantities. Nobody sells finished, verified, deliverable one ounce coins at spot, because refining, minting, packaging and insured freight all cost money.
The gap is the premium, and it is a normal part of the product rather than something being concealed. What matters more is the spread, meaning the difference between what a dealer sells at and buys back at, since that is your real round trip cost.
"I should clean my tarnished silver"
This is the most expensive myth on the list, because acting on it causes permanent damage.
Tarnish is a surface reaction between silver and compounds in the air. It does not reduce the silver content by any meaningful amount. Polishing, by contrast, physically removes metal and leaves marks that any dealer can see, and cleaned bullion invites questions about what else might have been done to it.
Leave it alone. The same applies to copper patina.
"Bigger is always better value"
Larger bars do cost less per ounce, and for pure accumulation they are efficient. But a kilogram bar is a single indivisible unit. If you want to release part of a holding, you cannot sell a corner of it.
Buyers who put everything into large units and later want to sell in portions find they have to liquidate far more than intended. Divisibility has a real value that the cost per ounce comparison does not capture.
"All 24 carat gold is the same"
Carat and decimal fineness are different scales, and they are not interchangeable shorthand. Products described in carats and products described as 9999 are not automatically equivalent, and specifications vary between mints and issues.
Read the stated fineness on the specific product rather than relying on a carat description.
"Opening the packaging does not matter"
The metal is unchanged, but the verification chain is not. A sealed assay card with a matching serial number lets a dealer price quickly and confidently. An unpackaged bar may need testing first.
On smaller items the testing effort can be disproportionate to the value. Leave seals intact. Our guide to assay cards and packaging covers this.
"Fake bullion is easy to spot, so I do not need to worry"
Most fakes are easy to catch, because a counterfeit cannot usually match correct weight and correct dimensions simultaneously. But one type defeats those checks entirely: a tungsten core in a gold shell, since tungsten has a density close to gold.
This is a risk mainly on larger gold bars, where there is enough volume to conceal a core. The defences are buying sealed from recognised refiners and using a dealer with electronic verification. Our guide to spotting fakes covers the detail.
"Silver and gold move together"
They correlate loosely but diverge often, and the reason is industrial demand. Around half of silver demand comes from electronics, solar and manufacturing, which ties silver to the economic cycle in a way gold is not. Silver can fall on manufacturing news that leaves gold untouched.
"A collector design will be worth more later"
Sometimes, but not reliably. Most dealers price bullion on metal content regardless of design. Collector premiums exist in a separate market that is far less liquid than bullion, and predicting which designs develop that interest is not something to count on.
Buy an attractive design because you like it, not because you expect the design itself to appreciate.
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We stock gold, silver, platinum, copper and titanium. See the range or visit the showroom at 124 Peterborough Street, Christchurch.