Not here to debate the future prices of gold/silver, I'm sure there are plenty of other forums where that can happen.
I'm more just wondering, where is the cheapest place to buy gold coins?
I know generally different gold brokers charge different premiums over the spot price of gold. On average they seem to charge about 4-6% of a premium over the spot price. Does anyone know brokers that offer the lowest mark ups?
I'm looking for reputable dealers only as I do not want to deal with the hassle of trying to determine whether coins I buy are counterfeit, mixed with other metals, etc.
Golden eagles at a coin store traded at $60 over spot on the bid and $30 over spot on the offer as of December. If the price increases you may actually make money on the spread. I paid $20 over spot a few years ago and was able to sell at the $30 premium. If you assume the spread will stay constant at the current level, your total cost is ~ 2%. ($1438 / ($60 - $30))
1 oz gold bars generally sell at right around spot (if you can find them). Be careful though, they are harder to unload and you will probably have to sell them at a discount.
Think about storage costs also. I always kept my gold in a safety deposit box and that cost is ~ $50 / year
There was actually an arbitrage question on this in my financial markets final one semester, it involved the commodity costs in different markets as well as storage costs. Interesting thought.
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