How Much is a Gold Bar Worth (And How Do You Buy One)?

Gold can help diversify your investment portfolio, especially if you are concerned about inflation, because its value tends to stay relatively stable, even during periods of market volatility. I’m always on the lookout for ways to diversify my portfolio, gold being one of them.

Gold prices work differently than standard stock investments. The cost of a gold bar depends on the current price of the precious metal, known as the spot gold price. As of August 27, 2024, one ounce of gold is worth $2,536.20. A gold bar, which is about 32 ounces, has a price of $81,158.40.

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How much is a gold bar worth?

Gold bars, also known as gold bricks and blocks, are available in many different sizes, often ranging from one-gram gold bars (0.032 oz t) to one-kilo gold bars (32.5 oz t). Here’s a breakdown of some of the common gold bar sizes and their prices as of August 27, 2024:

The size of gold bars matters for storage purposes, as well as how much money you have available to invest in gold. If you’re just starting, investing in smaller gold bars could make sense. But with more money comes bigger (literally) investment opportunities.

Remember that the spot price of gold is typically lower than the actual cost of a gold bar. Most companies that sell gold bullion bars add a premium to the current price. For example, a one-ounce gold bar might have a spot price of more than $1,800, whereas the actual cost is over $1,900. This is similar to how brokers charge trading fees for managing your investments.

It's often worth comparing multiple dealers or exchanges to find lower premiums on the gold you’re interested in.

What is a gold bar?

A gold bar is gold formed into the shape of a bar. When speaking of gold bars, most assume that the bar in reference is associated with the international gold market, which tracks live gold prices for companies and individuals investing in gold and silver. The live gold price is typically shown as the price of one ounce of gold, which could be in the form of bars or coins.

These live prices are known as “spot prices,” or what you might pay for gold on the spot, and are often updated by the minute.

Gold bars have varying sizes, but commonly traded bars have similar makeup. This means that each investor-quality gold bar often contains a high percentage of gold content with few impurities. It’s nearly impossible to achieve 100% gold purity, but many gold bars are considered fine or almost pure gold.

Common sizes of gold bars

Gold bars are typically separated into two weight classifications: grams and ounces. This is because different units of measurement are used worldwide. However, the one-ounce gold bar is the most popular size for calculating live gold prices.

Note that an ounce of gold doesn’t typically equal the same weight as an ounce of most other things. For example, an ounce of gold likely wouldn’t weigh the same as an ounce of meat at the grocery store.

This is because precious metals such as gold, silver, platinum, and palladium use a different type of ounce called the troy ounce (oz t or troy oz). One regular ounce is equal to about 0.91 oz.

What affects the price of gold?

No one can 100% pinpoint the exact factors that affect any type of investment, especially gold. However, looking at historical trends, gold prices don't follow the same course as certain stocks.

This is because stocks are volatile, so their price can fluctuate dramatically depending on

different factors. A stock worth a lot one day could be worth close to nothing the next.

Gold tends to be more stable; here are the factors that mostly affect it:

• Supply and demand: As a physical asset, gold prices might fluctuate depending on availability. If gold bars become more scarce, their prices may increase. Conversely, if there’s a lot of gold but not much demand, gold prices could fall.
• Economic events: Gold is often seen as a safe haven or an investment that isn’t expected to lose much of its value during periods of economic volatility. During global events, like the 2008 financial crisis, investors might flock to buy gold bars, driving their value (and price) up.

Reasons to buy gold

If you want to learn how to invest money, it’s important to understand why you might want to invest in something. Here are a few reasons you might consider buying gold:

• Safe haven: Gold has a reputation as a safe investment if you’re worried about turbulent economic conditions.
• Track record: Gold’s price has risen dramatically in the past few decades, from an average price of less than $300 per ounce in 1999 to $2,536.20 as of August 27, 2024.
• Physical asset: Gold is a tangible asset that won't mysteriously disappear, unlike the worries surrounding digital assets.
• Inflation: As inflation increases, your purchasing power typically decreases, like the value of the U.S. dollar. Gold isn’t necessarily tied to the value of the dollar and is often considered a hedge against inflation.
• Diversification: Diversifying your portfolio or spreading out your investments is best. This could help reduce the overall risk of your investments by distributing the risk across multiple types of investments.

How to buy gold

There’s no one right way to invest in anything, including gold. But knowing how to buy gold and the different options available could help you make an informed decision. Here are a few options for buying gold.

Physical metal

Gold is available in many forms, including bars, coins, rounds, jewelry, and more. Bars and coins are the most common ways to invest in physical gold. It’s relatively easy to check gold prices daily and use online gold dealers such as JM Bullion and APMEX to browse available stock.

Futures

Futures are contracts for buying and selling assets at a set price on a future date. Gold futures are contracts for buying and selling gold at predetermined prices by a specified date.

Exchange-traded funds

An exchange-traded fund (ETF) is typically a grouping of assets that contains multiple stocks or bonds in one fund. Gold ETFs allow you to invest in a bundle of gold-related stocks or bonds. However, you won’t actually own any physical gold assets.

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Mining stocks

Similar to investing in gold ETFs, you can skip the bundling and go straight to individual stocks. Experts believe that the stocks of companies involved in gold mining or production follow the same price trend as gold itself. Consider these gold stocks you can invest in.

Gold IRA

A gold IRA is similar to a regular IRA, except it’s specifically designed for holding physical assets such as precious metals. Gold IRAs typically have the same contribution and distribution limits as other IRAs.

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Bottom line

Investing doesn’t just mean stocks or real estate. It’s always a good idea to diversify your portfolio, and precious metals could be a great way to do it. Even if you don’t want to own gold itself, you can invest in gold stocks, ETFs, or futures to reduce your portfolio’s volatility.

Gold bars offer a unique opportunity to invest in an alternative asset that’s not as common as stocks but could still provide valuable financial security.

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