Glossary of Terms


Bullion refers to both coins and bars of a high level of purity. Bullion coins are contemporary precious metal coins minted by official agencies for investment purposes. Bullion bars must have a minimum acceptable fineness of 99.5%, according to the London Bullion Market Association (LBMA).

Capital Gains Tax

A tax levied on profit from the sale of property or an investment.

Glossary For Precious Metals

Debt Ceiling

An upper limit set on the amount of money that a government may borrow. Gold tends to increase in value while the U.S. debt limit is raised.

Debt-to-GDP Ratio

The ratio between a country’s government debt (a cumulative amount) and its gross domestic product (GDP) (measured in years). A low debt-to-GDP ratio indicates an economy that produces and sells goods and services sufficient to pay back debts without incurring further debt.

Precious Metals Glossary


A risk management technique that mixes a wide variety of investments within a portfolio.

Fiat Money

Fiat currencies have no intrinsic value and are used solely as payment. Fiat currencies are not backed by any physical commodity but derive their value from the strength of the government that issues it.

Investment Grade

Gold bullion that meets the defined minimum purity requirements is also called investment grade gold or just investment gold.


This unit measures the purity, also called the fineness, of a precious metal product. The highest level is 24-karat, at which the gold content is at a minimum of 99.9%. A 22-karat gold coin contains 91.67% gold.


Liquidity measures how easily and quickly an asset can be sold. Gold and silver bullion has a high degree of liquidity because these coins and bars are recognized around the world and accepted across all currency pairings.

Mint State

Mint State or (M.S.) stands for the quality and condition of a certified coin. M.S. ratings range from MS 60 to MS 70 and are issued by independent grading agencies such as the Numismatic Guarantee Corporation (NGC) and Professional Coin Grading Service (PCGS).

Glossary For Precious Metals

Negative Interest Rate

Instead of receiving money on deposits, depositors must regularly pay to keep their money with the bank.

Negative Return

This occurs when an investment has a financial loss or a decline in value during a specific period of time.

Precious Metals Glossary


In contrast to bullion coins, numismatic coins are rare, collectible coins. Each individual coin can differ widely in price due to rarity, quality, mint date, and other factors. These coins are not as closely linked to the precious metal’s spot price and are not allowed in an IRA.

Market Value

The market value of a coin refers to the current resale price on the open market. This is not the spot price but the actual value of the particular precious metal coin on the market.


Proof refers to the unique finish of a particular precious metal coin. Proof coins are double struck and often minted with special dies on a much more limited basis. Proof coins often trade at a significant premium to bullion coins.

Quantitative Easing

The introduction of new money into the money supply by a central bank. It is a monetary policy used by central banks to stimulate the economy. Quantitative easing lowers interest rates, increases the money supply, and often devalues the underlying fiat currency.

Self-Directed IRA

A Self-Directed Individual Retirement Account allows for alternative investments for retirement savings. Self- Directed IRAs can contain traditional investments such as stocks, bonds, and mutual funds as well as physical assets such as gold, silver, platinum, and palladium. These are also referred to as “precious metal” IRAs. Precious Metal IRAs are “self-directed” because they permit a more extensive range of alternative investments than a traditional IRA.

Precious Metals Glossary

​Spot Price

The spot price is the current market price at which an asset is bought or sold for immediate payment and delivery. In the precious metals markets, the spot price most often refers to the price of the global exchange markets such as the COMEX. It can also be thought of like the theoretical value of the metal before it is converted to an investment-grade coin or bar.

Troy Ounce

The troy ounce is the standard English measurement for the weight of precious metals. One troy ounce is equal to 1.097 regular ounces or 31.103 grams.