ACTUAL GOLD CONTENT: The amount of pure gold that exists in an object when all other metals have been extracted.
ALLOCATED: This term refers to the practice in which the client’s metal is individually identified as theirs, and physically segregated from all the other gold in the vault. It is the storing specific precious metal products in a segregated account for the exclusive benefit of a particular accountholder. Allocated goods are safe from the insolvency of financial institutions, carrying no counter-party risk. Within gold investment there is a huge difference between allocated and unallocated gold. When you invest in gold you typically want to own a tangible asset that is outside of the leveraged financial system and free from counterparty risk.
ARBITRAGE: Simultaneously buying and selling a commodity in different markets to take advantage of price and/or premium differentials.
ASK: The price at which a dealer offers to sell.
ASSAY: A test to ascertain the fineness and weight of a precious metal. For gold and silver bullion to be accepted by the professional markets the assay results must verify a minimum acceptable fineness set by the London Bullion Market Association® (LBMA®). Bullion that meets LBMA® standards is said to be ‘Good Delivery’. When you invest in gold or silver using your Troy Ounce Holding®, you are buying good delivery bullion. Investing in good delivery bullion is important, since it means that when you sell, you are selling a guaranteed quality of gold or silver, and therefore achieve a higher price.
AUDITOR: Means Ernst & Young® or such other international firm of chartered accountants as Hard Asset Holdings® may designate from time to time for such purpose.
BAILMENT: The temporary placement of control over or possession of personal property by one person, the bailor, into the hands of another, the bailee, for a designated purpose upon which the parties have agreed. The term bailment is derived from the French bailor, “to deliver.” It is generally considered to be a contractual relationship since the bailor and bailee, either expressly or impliedly, bind themselves to act according to particular terms. The bailee receives only control or possession of the property while the bailor retains the ownership interests in it. During the specific period a bailment exists, the bailee’s interest in the property is superior to that of all others, including the bailor, unless the bailee violates some term of the agreement. Once the purpose for which the property has been delivered has been accomplished, the property will be returned to the bailor or otherwise disposed of pursuant to the bailor’s directions.
BAILMENT AGREEMENT: The legal relationship between Troy Ounce Metals® and the Client which delivers the strongest legal protection of the Client’s property rights over its bullion assets held in Troy Ounce Holding®.
BASIS POINT(S): One hundredth of one percent 0.01%. For example, 900 basis points is equal to 9.0%.
BULLION: Refined gold that is at least 999.5 pure, usually in the form of bars, wafers or ingots.
BULLION BAR: The typical form in which precious metals are traded and accumulated. Bars for gold and silver investment come in various weights and sizes. The most commonly traded bars of investment gold are 1kg and 400 ounce (approx. 12.5kg), whilst the most traded silver bars are 1000 ounce (approx. 34kgs).
BUSINESS DAY: Means any day other than a Saturday, Sunday or other day on which banks are authorized or required by law to close in the United States.
CARAT: A measurement of weight generally used in reference to diamonds and precious gems. It is equal to about 3.086 grains or 200 milligrams. It is not to be confused with karat, which is a measurement of the fineness of Gold.
CENTRAL BANK: The entity responsible for establishing a nation’s monetary and fiscal policy, and controlling the money supply and interest rates. In the United States, the Federal Reserve System, which is managed by the Federal Reserve Board of Governors, fulfills the role of the central bank.
CERTIFICATES: Gold certificates are a method of holding gold without taking delivery. Issued by individual banks or bullion dealers they confirm an individual’s ownership while the bank holds the metal on the client’s behalf. The client thus saves on storage and personal security issues, and gains liquidity in terms of being able to sell portions of the total holdings without assay.
CHAIN OF INTEGRITY: This refers to a critical defining feature within the Primary Bullion Market. The Chain of Integrity ensures that bullion traded by London Bullion Market Association® (LBMA®) members maintain a traceable chain of custody among trusted trading partners. The LBMA® maintains a list of acceptable member refineries that meet certain membership requirements and have passed assay tests. This is important because bullion products from these refineries will generally be accepted by other members of the LBMA® at face value without further assay testing. When purchasing bullion products, the face value can generally be accepted if the product can be shown to have remained in the custody of a certified bullion repository since its manufacture by an acceptable refinery. The rules established by the LBMA® create the environment whereby members can trade bullion between themselves without concern as to the quality or the purity of the bars.
COLLATERAL: Properties, assets or securities that are offered to secure a loan or other credit. Sometimes this collateral is put up to meet a broker or exchange’s margin requirements. Collateral can be seized by the party that extended you the credit if you default. If you have a 50% mortgage on your house, the bank has lent you this money in the knowledge that the other 50% of the house’s value has been pledged as collateral against the loan. If you suddenly become unable to pay your mortgage, the bank can recover their lost income from this collateral.
Gold Bullion bars have been increasingly accepted as collateral in the financial markets by brokers, banks and clearing houses.
COMEX®: One of the world’s major commodities futures exchanges where Gold and Silver are traded. It is a division of the New York Mercantile Exchange® (NYMEX®). COMEX® gold contracts represent 100 ounces each, and the actively traded contracts are the even months of the year.
COMMISSION: The fee charged by a broker for the execution of an order.
COUNTERPARTY: is a term most commonly used in the financial services industry to describe a legal entity, unincorporated entity or collection of entities to which an exposure to financial risk might exist. Within the financial services sector, the term market counterparty is used to refer to governments, national banks, national monetary authorities and international monetary organizations such as the World Bank Group® that act as the ultimate guarantor for loans and indemnities. The term may also be applied, in a more general sense, to companies acting in this role. Within financial services, counterparty can refer to brokers, investment banks, and other securities dealers that serve as the contracting party when completing “over the counter” securities transactions. The term is generally used in this context in relation to “counterparty risk”, which is the risk of monetary loss a firm may be exposed to if the counterparty to an over-the-counter securities trade encounters difficulty meeting its obligations under the terms of the transaction.
COUNTERPARTY RISK: The risk to each party of a contract that the counterparty will not live up to its contractual obligations. In most financial contracts, counterparty risk is also known as “default risk”.
CUSTODIAL MANAGEMENT AGREEMENT: Means the Custodial Management Agreement in effect from time to time between Malca-Mit® and Troy Ounce Meals®, as the agent of the Investor, to govern the custody and handling of precious metals on behalf of Investors.
DELIVERABLE BAR: A Precious Metal bar with a weight, fineness and hallmark approved as a tradable unit on a commodity exchange, such as the London Bullion Market Association® (LBMA®).
DEPOSITORY: Depositories are storage facilities, similar to professional vaults that provide a full range of specialized precious metals custody, accounting and shipping services to financial exchanges, institutions and industrial companies. They are another way of storing gold and silver bullion for the professional market.
DERIVATIVE: A financial instrument derived from a cash market commodity, futures contract or other financial instrument. Derivatives can be traded on regulated exchanges or over-the-counter. Futures contracts, for example, are derivatives of physical commodities, and options on futures are derivatives of futures contracts. Derivative contracts are often characterized by high leverage.
GIA® DIAMONDS: Loose polished diamonds that meet GIA® Analysis & Grading Standards.
FATCA: The Foreign Account Tax Compliance Act (FATCA) is a United States federal law that requires United States persons, including individuals who live outside the United States, to report their financial accounts held outside of the United States, and requires foreign financial institutions to report to the Internal Revenue Service (IRS) about their U.S. clients. Congress enacted FATCA to make it more difficult for U.S. taxpayers to conceal assets held in offshore accounts and shell corporations, and thus to recoup federal tax revenues.
FIAT MONEY: Paper money made legal tender by law, although not backed by Gold or Silver. From the Latin let it be done. Fiat currency is the currency system on which all global currencies are now based. It can be defined as “Paper currency not backed by gold, convertible foreign exchange, or even in some cases, government bonds,”. Fiat currency has no intrinsic value; its value is that which is decreed by government, and as a result our monetary system is now built on government debt.
FINE GOLD: The purity or fineness of a Gold coin or Gold bullion item. Pure Gold is 24 karat, or 0.999 fine, Gold.
FINE WEIGHT: 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 Kruggerand has a fine weight of 1 troy/oz, but the same coin has a gross weight of 1.0909 troy/oz.
FINENESS: Gold purity, usually expressed in parts per thousand; thus 995 or two nines five is 995/1000 or 99.5% pure. For example, a gold bar of .995 fineness contains 995 parts gold and 5 parts of another metal. Gold is produced in bars up to a purity of 999.9 (often referred to as “four nines”).
FOUR NINES: Gold of the highest purity containing at least .9999 gold. Four nines gold is equivalent to 24 karat gold.
FUNGIBLE: A good or asset that can be interchanged with other individual goods/assets of the same type. Assets possessing this property simplify the exchange/trade process, as interchangeability assumes that everyone values all goods of that class as the same.
GOLD PRICE: The gold price is the rate at which gold trades in relation to any number of currencies. The most referred to gold price is that quote in dollars per troy ounce. This dollar per ounce gold price has become the gold market’s reference price due to the US dollar’s status as the international reserve currency.
GOLD/SILVER RATIO: The number of ounces of Silver required to buy one ounce of Gold at current spot prices.
GOLD STANDARD: Monetary system adopted during various periods of the 20th Century under which participating currencies were backed by gold reserves and exchange rates were fixed in terms of their value in gold. The term to designate the monetary standard of a country when all the paper money it issues is backed by a sufficient amount of a reserve holdings of gold.
GOOD DELIVERY STANDARD: The Good Delivery Standard specification is a set of rules issued by the London Bullion Market Association® (LBMA®) regarding the physical characteristics of gold and silver bullion used in settlement in the wholesale London bullion market that indicate acceptable ranges of bar size, weight, purity, and dimensions evidenced by a traceable "chain of custody" among accredited trading partners where bullion bars are accepted at face value without an assay test.
GOOD DELIVERY BAR: A bar of Gold or Silver that is acceptable for delivery against a metals contract.
GRAM: The basic unit of weight of the metric system A metric unit of mass and weight. A gram equals approximately 1/32 Troy/oz. and is used in Troy weight as a measure of gold. (31.1035 grams = one troy ounce.)
HALLMARK: Mark, or marks, which indicate the producer of a gold bar and its number, fineness, etc.
GOLD LOAN: A Gold Loan is a limited-recourse loan that is secured by a pledge of collateral, typically real property, but for which the borrower is not personally liable. If the borrower defaults, the lender/issuer can seize the collateral, but otherwise the lender's recovery is limited to the collateral
KARAT: Measurement of purity used in showing the fineness of Gold, scaled 1 to 24. 24 karat is pure Gold and has at least 999 parts pure gold per thousand; 18-karat has 750, parts pure gold and 250 parts alloy, etc.
KILO BAR: A bar weighing one kilogram (32.148 t/oz).
KILOGRAM: 1,000 grams (32.148 t/oz).
LEVERAGE: Is the amount of debt in relation to equity capital. The use of borrowed capital or financial instruments to fund an investment. The more leverage used to make an investment, the greater exposure one has to movements in the price of the underlying asset. More speculative investors and traders use high degrees of leverage. When the market moves in the direction you want, leverage can help you achieve greater profits, but the problem is that is the market moves against you it can cause significant losses very quickly. When used inappropriately, leverage can work to destroy the value of your equity.
LONDON BULLION MARKET ASSOCIATION® (LBMA®): The LBMA® is the London-based trade association that represents the wholesale over-the-counter market for gold and silver in London with a global Membership and client base, including the majority of the central banks that hold gold, private sector investors, mining companies and others. LBMA® members facilitate the trading of ‘good delivery‘ bars during London trading hours.
LONDON FIX: Means internationally recognized price benchmarks as set by the London Bullion Market Association® (“LBMA®”) for gold and silver, and by the London Platinum and Palladium Market® (“LPPM®”) for platinum and palladium. There is a morning (a.m.) price fix as well as an afternoon (p.m.) price fix.
LPPM®: The LPPM® is the pre-eminent body that benchmarks and regulates the world’s largest and most important market for platinum and palladium bullion. The London Platinum & Palladium Market® is centered in London with a global membership and client base, including the majority of the central banks that hold platinum & palladium bullion, private sector investors, mining companies and others. LPPM® Membership includes more than 50 companies, including traders, refiners, producers, fabricators, as well as those providing storage and secure carrier services.
PAPER GOLD: Paper gold investments are investments where the investor does not own physical gold bullion, but a paper claim to gold bullion or an instrument linked to the gold price. The holder of paper gold owns a credit and not the underlying physical asset.
PRECIOUS METALS: Means only certified investment-grade gold, silver, platinum or palladium bullion bars that meet LBMA®/LPPM® Good Delivery Standards.
PREMIUM: The additional cost of a coin or bullion item, over and above the spot price of the Precious Metal contained in the coin. The premium includes the costs of fabrication, distribution and a minimal dealer fee. Rare coins carry an additional premium representing numismatic value, which is based on scarcity, quality, demand and intangible factors.
PURITY: Gold fineness, usually expressed in parts per thousand; thus 995 or two nines five is 995/1000 or 99.5% pure. For example, a gold bar of .995 fineness contains 995 parts gold and 5 parts of another metal.
SEGREGATED: is the act of keeping investor assets, held by a broker or other financial institution, separate – or segregated – from the broker or financial institution’s assets.
SPOT PRICE: Sometimes referred to as the cash price. The current price in the physical market for immediate delivery of gold
SPOT GOLD PRICE: is the quotation made by dealers based on US dollars per fine ounce for 100 ounce and 400 ounce gold bars and US dollars per ounce for 1,000 ounce silver bars. The “Spot Price” specifies that the settlement and delivery of such metals will occur two business days after the “Trade Date”. The Spot Gold Price is readily quoted in the Primary Bullion Market which is the focus of the international Over-the-Counter (OTC) market for gold and silver, with a client base that includes the majority of the central banks that hold gold, plus producers, refiners, fabricators and other large institutional traders throughout the world. Members of the Primary Bullion Market typically trade with each other and with their clients on a principal-to-principal basis, which means that all risks, including those of credit, are between the two counterparts in a transaction. Trades are made by dealers based on US dollars per fine ounce for gold and US dollars per ounce for silver. Where you elect to take up this right, Troy Ounce Metals® will act as your agent in the transaction.
SPREAD: The difference between Bid (the price a buyer is prepared to pay for gold and Ask (the price a seller offers) prices
TITLE REGISTER: Means the register of precious metals maintained by Troy Ounce Metals®.
TROY OUNCE: A unit of weight equal to 1.09711 ordinary or avoirdupois ounces. The word ounce, when applied to Gold, always refers to troy ounces. One troy ounce equals 31.1035 grams.
TROY OUNCE HOLDING®: The Troy Ounce Holding® is a custodial account representing physically allocated, segregated & redeemable physical asset ownership rights held in high-security vaults of your choosing (New York, Toronto, London, Zurich or Hong Kong) insured by Lloyd's of London® for up to $2 billion (USD) for the safe, secure and fully insured domestic / international storage of your safe haven assets.
UNALLOCATED GOLD ACCOUNT: An account where specific bars are not set aside and the customer has only a general claim on the metal. This is the cheapest and therefore the most commonly used method of holding metal. The account holder is an unsecured creditor.
ALLOCATED: This term refers to the practice in which the client’s metal is individually identified as theirs, and physically segregated from all the other gold in the vault. It is the storing specific precious metal products in a segregated account for the exclusive benefit of a particular accountholder. Allocated goods are safe from the insolvency of financial institutions, carrying no counter-party risk. Within gold investment there is a huge difference between allocated and unallocated gold. When you invest in gold you typically want to own a tangible asset that is outside of the leveraged financial system and free from counterparty risk.
ARBITRAGE: Simultaneously buying and selling a commodity in different markets to take advantage of price and/or premium differentials.
ASK: The price at which a dealer offers to sell.
ASSAY: A test to ascertain the fineness and weight of a precious metal. For gold and silver bullion to be accepted by the professional markets the assay results must verify a minimum acceptable fineness set by the London Bullion Market Association® (LBMA®). Bullion that meets LBMA® standards is said to be ‘Good Delivery’. When you invest in gold or silver using your Troy Ounce Holding®, you are buying good delivery bullion. Investing in good delivery bullion is important, since it means that when you sell, you are selling a guaranteed quality of gold or silver, and therefore achieve a higher price.
AUDITOR: Means Ernst & Young® or such other international firm of chartered accountants as Hard Asset Holdings® may designate from time to time for such purpose.
BAILMENT: The temporary placement of control over or possession of personal property by one person, the bailor, into the hands of another, the bailee, for a designated purpose upon which the parties have agreed. The term bailment is derived from the French bailor, “to deliver.” It is generally considered to be a contractual relationship since the bailor and bailee, either expressly or impliedly, bind themselves to act according to particular terms. The bailee receives only control or possession of the property while the bailor retains the ownership interests in it. During the specific period a bailment exists, the bailee’s interest in the property is superior to that of all others, including the bailor, unless the bailee violates some term of the agreement. Once the purpose for which the property has been delivered has been accomplished, the property will be returned to the bailor or otherwise disposed of pursuant to the bailor’s directions.
BAILMENT AGREEMENT: The legal relationship between Troy Ounce Metals® and the Client which delivers the strongest legal protection of the Client’s property rights over its bullion assets held in Troy Ounce Holding®.
BASIS POINT(S): One hundredth of one percent 0.01%. For example, 900 basis points is equal to 9.0%.
BULLION: Refined gold that is at least 999.5 pure, usually in the form of bars, wafers or ingots.
BULLION BAR: The typical form in which precious metals are traded and accumulated. Bars for gold and silver investment come in various weights and sizes. The most commonly traded bars of investment gold are 1kg and 400 ounce (approx. 12.5kg), whilst the most traded silver bars are 1000 ounce (approx. 34kgs).
BUSINESS DAY: Means any day other than a Saturday, Sunday or other day on which banks are authorized or required by law to close in the United States.
CARAT: A measurement of weight generally used in reference to diamonds and precious gems. It is equal to about 3.086 grains or 200 milligrams. It is not to be confused with karat, which is a measurement of the fineness of Gold.
CENTRAL BANK: The entity responsible for establishing a nation’s monetary and fiscal policy, and controlling the money supply and interest rates. In the United States, the Federal Reserve System, which is managed by the Federal Reserve Board of Governors, fulfills the role of the central bank.
CERTIFICATES: Gold certificates are a method of holding gold without taking delivery. Issued by individual banks or bullion dealers they confirm an individual’s ownership while the bank holds the metal on the client’s behalf. The client thus saves on storage and personal security issues, and gains liquidity in terms of being able to sell portions of the total holdings without assay.
CHAIN OF INTEGRITY: This refers to a critical defining feature within the Primary Bullion Market. The Chain of Integrity ensures that bullion traded by London Bullion Market Association® (LBMA®) members maintain a traceable chain of custody among trusted trading partners. The LBMA® maintains a list of acceptable member refineries that meet certain membership requirements and have passed assay tests. This is important because bullion products from these refineries will generally be accepted by other members of the LBMA® at face value without further assay testing. When purchasing bullion products, the face value can generally be accepted if the product can be shown to have remained in the custody of a certified bullion repository since its manufacture by an acceptable refinery. The rules established by the LBMA® create the environment whereby members can trade bullion between themselves without concern as to the quality or the purity of the bars.
COLLATERAL: Properties, assets or securities that are offered to secure a loan or other credit. Sometimes this collateral is put up to meet a broker or exchange’s margin requirements. Collateral can be seized by the party that extended you the credit if you default. If you have a 50% mortgage on your house, the bank has lent you this money in the knowledge that the other 50% of the house’s value has been pledged as collateral against the loan. If you suddenly become unable to pay your mortgage, the bank can recover their lost income from this collateral.
Gold Bullion bars have been increasingly accepted as collateral in the financial markets by brokers, banks and clearing houses.
COMEX®: One of the world’s major commodities futures exchanges where Gold and Silver are traded. It is a division of the New York Mercantile Exchange® (NYMEX®). COMEX® gold contracts represent 100 ounces each, and the actively traded contracts are the even months of the year.
COMMISSION: The fee charged by a broker for the execution of an order.
COUNTERPARTY: is a term most commonly used in the financial services industry to describe a legal entity, unincorporated entity or collection of entities to which an exposure to financial risk might exist. Within the financial services sector, the term market counterparty is used to refer to governments, national banks, national monetary authorities and international monetary organizations such as the World Bank Group® that act as the ultimate guarantor for loans and indemnities. The term may also be applied, in a more general sense, to companies acting in this role. Within financial services, counterparty can refer to brokers, investment banks, and other securities dealers that serve as the contracting party when completing “over the counter” securities transactions. The term is generally used in this context in relation to “counterparty risk”, which is the risk of monetary loss a firm may be exposed to if the counterparty to an over-the-counter securities trade encounters difficulty meeting its obligations under the terms of the transaction.
COUNTERPARTY RISK: The risk to each party of a contract that the counterparty will not live up to its contractual obligations. In most financial contracts, counterparty risk is also known as “default risk”.
CUSTODIAL MANAGEMENT AGREEMENT: Means the Custodial Management Agreement in effect from time to time between Malca-Mit® and Troy Ounce Meals®, as the agent of the Investor, to govern the custody and handling of precious metals on behalf of Investors.
DELIVERABLE BAR: A Precious Metal bar with a weight, fineness and hallmark approved as a tradable unit on a commodity exchange, such as the London Bullion Market Association® (LBMA®).
DEPOSITORY: Depositories are storage facilities, similar to professional vaults that provide a full range of specialized precious metals custody, accounting and shipping services to financial exchanges, institutions and industrial companies. They are another way of storing gold and silver bullion for the professional market.
DERIVATIVE: A financial instrument derived from a cash market commodity, futures contract or other financial instrument. Derivatives can be traded on regulated exchanges or over-the-counter. Futures contracts, for example, are derivatives of physical commodities, and options on futures are derivatives of futures contracts. Derivative contracts are often characterized by high leverage.
GIA® DIAMONDS: Loose polished diamonds that meet GIA® Analysis & Grading Standards.
FATCA: The Foreign Account Tax Compliance Act (FATCA) is a United States federal law that requires United States persons, including individuals who live outside the United States, to report their financial accounts held outside of the United States, and requires foreign financial institutions to report to the Internal Revenue Service (IRS) about their U.S. clients. Congress enacted FATCA to make it more difficult for U.S. taxpayers to conceal assets held in offshore accounts and shell corporations, and thus to recoup federal tax revenues.
FIAT MONEY: Paper money made legal tender by law, although not backed by Gold or Silver. From the Latin let it be done. Fiat currency is the currency system on which all global currencies are now based. It can be defined as “Paper currency not backed by gold, convertible foreign exchange, or even in some cases, government bonds,”. Fiat currency has no intrinsic value; its value is that which is decreed by government, and as a result our monetary system is now built on government debt.
FINE GOLD: The purity or fineness of a Gold coin or Gold bullion item. Pure Gold is 24 karat, or 0.999 fine, Gold.
FINE WEIGHT: 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 Kruggerand has a fine weight of 1 troy/oz, but the same coin has a gross weight of 1.0909 troy/oz.
FINENESS: Gold purity, usually expressed in parts per thousand; thus 995 or two nines five is 995/1000 or 99.5% pure. For example, a gold bar of .995 fineness contains 995 parts gold and 5 parts of another metal. Gold is produced in bars up to a purity of 999.9 (often referred to as “four nines”).
FOUR NINES: Gold of the highest purity containing at least .9999 gold. Four nines gold is equivalent to 24 karat gold.
FUNGIBLE: A good or asset that can be interchanged with other individual goods/assets of the same type. Assets possessing this property simplify the exchange/trade process, as interchangeability assumes that everyone values all goods of that class as the same.
GOLD PRICE: The gold price is the rate at which gold trades in relation to any number of currencies. The most referred to gold price is that quote in dollars per troy ounce. This dollar per ounce gold price has become the gold market’s reference price due to the US dollar’s status as the international reserve currency.
GOLD/SILVER RATIO: The number of ounces of Silver required to buy one ounce of Gold at current spot prices.
GOLD STANDARD: Monetary system adopted during various periods of the 20th Century under which participating currencies were backed by gold reserves and exchange rates were fixed in terms of their value in gold. The term to designate the monetary standard of a country when all the paper money it issues is backed by a sufficient amount of a reserve holdings of gold.
GOOD DELIVERY STANDARD: The Good Delivery Standard specification is a set of rules issued by the London Bullion Market Association® (LBMA®) regarding the physical characteristics of gold and silver bullion used in settlement in the wholesale London bullion market that indicate acceptable ranges of bar size, weight, purity, and dimensions evidenced by a traceable "chain of custody" among accredited trading partners where bullion bars are accepted at face value without an assay test.
GOOD DELIVERY BAR: A bar of Gold or Silver that is acceptable for delivery against a metals contract.
GRAM: The basic unit of weight of the metric system A metric unit of mass and weight. A gram equals approximately 1/32 Troy/oz. and is used in Troy weight as a measure of gold. (31.1035 grams = one troy ounce.)
HALLMARK: Mark, or marks, which indicate the producer of a gold bar and its number, fineness, etc.
GOLD LOAN: A Gold Loan is a limited-recourse loan that is secured by a pledge of collateral, typically real property, but for which the borrower is not personally liable. If the borrower defaults, the lender/issuer can seize the collateral, but otherwise the lender's recovery is limited to the collateral
KARAT: Measurement of purity used in showing the fineness of Gold, scaled 1 to 24. 24 karat is pure Gold and has at least 999 parts pure gold per thousand; 18-karat has 750, parts pure gold and 250 parts alloy, etc.
KILO BAR: A bar weighing one kilogram (32.148 t/oz).
KILOGRAM: 1,000 grams (32.148 t/oz).
LEVERAGE: Is the amount of debt in relation to equity capital. The use of borrowed capital or financial instruments to fund an investment. The more leverage used to make an investment, the greater exposure one has to movements in the price of the underlying asset. More speculative investors and traders use high degrees of leverage. When the market moves in the direction you want, leverage can help you achieve greater profits, but the problem is that is the market moves against you it can cause significant losses very quickly. When used inappropriately, leverage can work to destroy the value of your equity.
LONDON BULLION MARKET ASSOCIATION® (LBMA®): The LBMA® is the London-based trade association that represents the wholesale over-the-counter market for gold and silver in London with a global Membership and client base, including the majority of the central banks that hold gold, private sector investors, mining companies and others. LBMA® members facilitate the trading of ‘good delivery‘ bars during London trading hours.
LONDON FIX: Means internationally recognized price benchmarks as set by the London Bullion Market Association® (“LBMA®”) for gold and silver, and by the London Platinum and Palladium Market® (“LPPM®”) for platinum and palladium. There is a morning (a.m.) price fix as well as an afternoon (p.m.) price fix.
LPPM®: The LPPM® is the pre-eminent body that benchmarks and regulates the world’s largest and most important market for platinum and palladium bullion. The London Platinum & Palladium Market® is centered in London with a global membership and client base, including the majority of the central banks that hold platinum & palladium bullion, private sector investors, mining companies and others. LPPM® Membership includes more than 50 companies, including traders, refiners, producers, fabricators, as well as those providing storage and secure carrier services.
PAPER GOLD: Paper gold investments are investments where the investor does not own physical gold bullion, but a paper claim to gold bullion or an instrument linked to the gold price. The holder of paper gold owns a credit and not the underlying physical asset.
PRECIOUS METALS: Means only certified investment-grade gold, silver, platinum or palladium bullion bars that meet LBMA®/LPPM® Good Delivery Standards.
PREMIUM: The additional cost of a coin or bullion item, over and above the spot price of the Precious Metal contained in the coin. The premium includes the costs of fabrication, distribution and a minimal dealer fee. Rare coins carry an additional premium representing numismatic value, which is based on scarcity, quality, demand and intangible factors.
PURITY: Gold fineness, usually expressed in parts per thousand; thus 995 or two nines five is 995/1000 or 99.5% pure. For example, a gold bar of .995 fineness contains 995 parts gold and 5 parts of another metal.
SEGREGATED: is the act of keeping investor assets, held by a broker or other financial institution, separate – or segregated – from the broker or financial institution’s assets.
SPOT PRICE: Sometimes referred to as the cash price. The current price in the physical market for immediate delivery of gold
SPOT GOLD PRICE: is the quotation made by dealers based on US dollars per fine ounce for 100 ounce and 400 ounce gold bars and US dollars per ounce for 1,000 ounce silver bars. The “Spot Price” specifies that the settlement and delivery of such metals will occur two business days after the “Trade Date”. The Spot Gold Price is readily quoted in the Primary Bullion Market which is the focus of the international Over-the-Counter (OTC) market for gold and silver, with a client base that includes the majority of the central banks that hold gold, plus producers, refiners, fabricators and other large institutional traders throughout the world. Members of the Primary Bullion Market typically trade with each other and with their clients on a principal-to-principal basis, which means that all risks, including those of credit, are between the two counterparts in a transaction. Trades are made by dealers based on US dollars per fine ounce for gold and US dollars per ounce for silver. Where you elect to take up this right, Troy Ounce Metals® will act as your agent in the transaction.
SPREAD: The difference between Bid (the price a buyer is prepared to pay for gold and Ask (the price a seller offers) prices
TITLE REGISTER: Means the register of precious metals maintained by Troy Ounce Metals®.
TROY OUNCE: A unit of weight equal to 1.09711 ordinary or avoirdupois ounces. The word ounce, when applied to Gold, always refers to troy ounces. One troy ounce equals 31.1035 grams.
TROY OUNCE HOLDING®: The Troy Ounce Holding® is a custodial account representing physically allocated, segregated & redeemable physical asset ownership rights held in high-security vaults of your choosing (New York, Toronto, London, Zurich or Hong Kong) insured by Lloyd's of London® for up to $2 billion (USD) for the safe, secure and fully insured domestic / international storage of your safe haven assets.
UNALLOCATED GOLD ACCOUNT: An account where specific bars are not set aside and the customer has only a general claim on the metal. This is the cheapest and therefore the most commonly used method of holding metal. The account holder is an unsecured creditor.