The spot gold price is the “live gold price” that can be seen in the gold charts on the internet. This constantly changing price for spot gold is not created by an official exchange or an official electronic trading system, such as the Frankfurt Stock Exchange.

The world’s largest gold market, the so-called professional gold market, is known as ‘OTC’ (Over The Counter, also: off-exchange trading). Here, gold buyers and gold sellers themselves decide with whom they want to trade. They then trade directly with each other instead of through an exchange. Business is mainly done over the phone. With every single gold trade, a specific gold price and a traded amount are agreed. Gold brokers can name any gold price, and the customer (buyer or seller) can then decide whether or not to accept the gold price mentioned. This is completely different from buying a gold coin from a coin dealer or buying equities through a single exchange like the Frankfurt Stock Exchange.

In OTC transactions, only the so-called Good Delivery gold bars are traded, which are usually delivered two working days after purchase. These gold bars weigh 400 ounces (approximately 12.44 kilos) and their shape is strictly determined by the London Bullion Market Association. Nothing is as strictly standardised on the gold market as the high quality of these gold bars. Due to the structure of this market, there is no uniform gold price worldwide.

The advantage of trading on this market: You pay no or at most a small surcharge for officially recognised Good Delivery bars. Unless the buyer not only wants to acquire the property, but actually takes possession of the gold and does not want it to be stored in a vault recognised by the London Bullion Market Association (LBMA).

The spot price can be divided into three phases worldwide:

Trading in Tokyo: Prices for physical gold are listed on the Tocom Futures Exchange.

Trading in London: The 10 largest members of the London Bullion Market Association (LBMA) list gold prices for both buying and selling.

Trading in New York: The standard contract for US gold futures, the 100-ounce Comex contract, is also known as the “New York gold price”.

The gold price that gold brokers quote when trading is always very close to the spot price. This is based on the live gold price chart, which is available for almost all currencies.

However, since the spot price is not an official price, such as that of Google shares on the Nasdaq in New York, the gold industry (gold manufacturers, gold refiners, jewellery dealers, coin dealers, gold investment funds and industrial gold processors) has a problem with the price formation of gold.