Frequently Asked Questions
(1) What is the Spot rate?
The spot rate is the internationally agreed price based on supply and demand, for the value of 1 Troy ounce of gold or silver in unfabricated form. Pricing for all Finemetal Asia bullion products are derived from this constantly fluctuating rate. This is reflected on our website: our live pricing fluctuates constantly to reflect the current spot price.
(2) Why does the customer pay more than the Spot rate?
Or: what is the margin?
When you buy physical bullion, you are buying precious metals, e.g. gold and silver, manufactured into a tradable form, e.g. a 100g minted bar or 1000g cast bar. It is necessary for bullion retailers to charge a margin above, when selling to the customer, or below, when buying back from a customer, the spot rate. The margin covers production cost, logistic cost, storage cost, insurance cost, packaging cost and so on.
Finemetal Asia offers competitive buy and sell rates on bullion and can improve these rates on volume.
(3) Why buy physical gold?
It is generally advisable to diversify your assets in order to minimize risk of loss.
There are five main reasons for people to invest into physical precious metals, mainly gold and silver:
(a) High demand: take advantage of a very secure, tangible and fungible commodity where demand usually is higher than supply
(b) Inflation: it is well established that gold and silver act as inflation hedge, i.e. protects the owner against the devaluation of assets due to inflation and exchange rate fluctuations
(c) Diversification: diversification of investment assets minimizes risk of overall loss
(d) Wealth preservation: preserve individual or family wealth over generations, independent of the financial system or governments
(e) Asset protection: Gold and Silver offer protection of wealth in unstable times of unrest and crisis.
Gold and Silver in physical form makes the investor independent of any financial system or government in the sense that is can be traded anywhere, anytime at the convenience of the investor. Physical Gold and Silver does not depend on a bank for clearance or trading, and does not bear any counter-party risk as even a gold account (so called Papergold) inherently has. Physical Gold and Silver is viewed as an international currency.
(4) Why buy from Finemetal Asia?
Amongst all the providers of precious metals products in Hong Kong and Asia, only Finemetal Asia can provide the following:
- Guaranteed constant supply by one of the world’s leading Swiss based refiners of precious metals, Argor Heraeus SA
- All our products are officially certified LBMA good delivery standard, ensuring international acceptance
- Our products have been tested by the Chinese Gold and Silver Exchange Society in Hong Kong (CGSE)
- 100% counterfeit security: our products optionally come with the KINEGRAM technology which ensures 100% fraud protection
- ISIN: our round-bars (coins) have Swiss ISIN enabling depository with depository banks
- Privately owned and operated high security storage facilities in safe jurisdiction available
- All major currencies accepted for trading
(5) How does the USD affect gold prices?
As most if not all commodities, precious metals trade in USD internationally. Therefore the local currency’s exchange rate to the USD affects the precious metals’ price in a non USD jurisdiction. As the HKD is pegged to the USD the fluctuation in Hong Kong is virtually zero, but it does affect other jurisdiction in Asia.
Whereas we prefer to trade in USD or HKD, Finemetal Asia can offer prices in all major and some minor currencies.
(6) Why does Finemetal Asia not offer discount prices?
The margin covers everything from production costs, packaging and logistic expenses to storage charges. Therefore the price of our product can never be lower than the spot price and no reputable trader of internationally certified precious metals would offer to sell at a discount price to spot.
(7) Can I pay in cash?
In general: No.
(8) Can I pay by credit card?
No.