Impressive in size and appearance, Kilo Gold Bars are one of the most spectacular investments in the bullion market. While the value of a kilo gold bar is rooted in the current price of gold, other factors like manufacturing technique and source can play a part in its final cost. Let’s explore.
Although 24-karat gold bullion pieces are available in a wide range of dimensions and shapes, most commonly, gold bars resemble a fairly thin rectangle. Other shapes of pure gold bullion are known and referred to by their more descriptive names, such as gold round, oval, square and even a gold boat. Shape withstanding, there are two basic types of gold bar manufacturing techniques – casting and minting.
Cast bars: Gold bullion bars, including the 1 Kilo Gold Bar, made with the casting method start by pouring molten metal into a mold. Generally, the form of the mold has tighter dimensions at the bottom than at the top, so that the solid bar may be more easily extracted from the mold. Thereby, standard cast bullion bars have slightly different dimensions at the top and bottom. Because molten bullion is poured into a mold, the surfaces of cast bars are fairly rough as compared to minted/fabricated bars.
Minted bars: Modern gold bullion bars are typically fabricated, aka minted, by first rolling a sheet of pure gold to exacting standards of thickness and gold content. Each bar is then stamped out with a die in the desired dimensions and shape – most commonly rectangular, to yield the precise measurement of gold. The stamping process produces a smooth finish and equal dimensions on both the top and bottom, unlike cast bars.
Note: Gold bars of lower purity would have to weigh slightly more to achieve that same amount of absolute pure gold. For example, the one kilogram designation means each kilo gold bar must contain exactly one kilo of 100% gold, requiring a slightly larger quantity of impure gold to reach that same value.
Because of gold’s precious value, kilobars may need to be readjusted to the exacting amount of gold, nothing more or less. For instance, if the cutting process yielded an underweight blank, that gold would need to be reprocessed before being hallmarked and polished.
In the marketplace, it seems that minted bars carry higher appeal and premiums than cast bars. Cast bars are generally the preferred manufacturing characteristics for large format bars heavier than one kilogram, while minted bars are common for one Kilo Gold Bars and smaller.
Why?
For larger positions, the more cost-effective and production-efficient cast bars are perfectly adequate. However, for individual investors holding just a few in their possessions, they see perceived value in the bar’s exact shape for stacking and aesthetic appeal inherent in fabricated production.
Another factor affecting the premium of a gold bar is simply who manufactured it. Because of the risk of counterfeiting, some gold ingots are fabricated with security measures, but it is untested how well they will perform over time. The leading fabricated gold bar producers attempting security measures are the two largest refining mints, the Royal Canadian Mint and the Australian Perth Mint, as well as top Swiss refiners, Pamp Suisse, headquartered in Lugano, and Valcambi, located in Balerna. These cutting-edge brands and hallmarks seem to have the greatest investor appeal, and in turn, demand higher prices.
A gold bar manufacturer’s name, called a “hallmark,” is stamped on an ingot and acts much like a signature on an agreement. The hallmark serves as a well-recognized brand in the market, acting as the producer’s assurance regarding the bars’ guaranteed gold content and purity. Well-regarded brands in gold bar production, often referred to as “deliverable” hallmarks, are the COMEX, NYMEX, CME or London Bullion Market Association (LBMA) approved refineries. In addition to these fine manufacturers, two prominent world mints, the Royal Canadian Mint and Australia’s Perth Mint, have extensive refining capabilities and consistently produce high-demand bullion bars.
Key players in the production of 1 Kilo Gold Bullion Bars include:
Professional gold merchants can easily identify a gold ingot’s mint or refinery and whether or not they are reputable; however, for the retail investor, it may not be as simple to discern suspect samples. At Monex, we only offer the best quality and most popular investment-grade brands/hallmarks. Gold bars available for home delivery adhere to the highest standard with a fineness of 99.99% and are exclusively sourced through the most reputable financial institution distribution channels. For investors seeking reliable kilo gold bars, Monex stands out as one of the premier options to consider.
Gold bullion bars should be acquired for their gold content and future liquidity appeal. Besides purchase transaction and product reliability, ‘more metal for your investment dollar’ should be the primary factor in selecting a gold bar investment. Because modern bullion bars lack collector rarity and historical significance appeal, they are likely to be priced in the future at just their melt value. As discussed, however, unique characteristics like specialized security enhancements or high-demand hallmarks may result in higher premiums, leading to increased costs for the same amount of gold. To avoid added premium costs, gold investors have historically preferred gold bullion bars over coins, even though coinage typically maintains the most reliable resale liquidity in the precious metals marketplace.
With a keen understanding of investor demand, Monex proudly offers the 32.15 troy ounce gold “kilobar” – a one kilogram bar of .9999 fine gold bullion. These “four-nines” fine gold ingots are among the purest gold bullion bars available to investors today. Each certified bar is stamped with the manufacturer’s hallmark, weight, and gold content.
When choosing an investment vehicle, it’s imperative to understand the nuances of the products you are considering. To determine whether the kilo gold bar is right for your investment strategy, contact a knowledgeable Monex account representative today.
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