GOLD PRICE CHARTS

You can use the Midas Gold Group Gold Chart to view current and historical prices for gold over the past ten years. You can easily manipulate the chart to view prices over any selected date range. Our chart also gives you the ability to compare the price of gold against other asset classes such as the major stock indices, the US dollar and oil.

UNDERSTANDING THE GOLD SPOT PRICE

The gold price posted on our website as well as virtually every other website is what is referred to as the spot price of gold. In general a “spot price” is a price paid for immediate delivery of a commodity. This is different than a futures contract or forward contract.

Here is where the gold spot price can get confusing: even though “spot price” refers to immediate delivery, the gold spot price is actually calculated using the trading price of gold futures. Specifically, the gold spot price is the front month futures contract with the highest volume, or contract most actively traded. “Front month” refers to a near-term future contract expiration month. Often the contract is in the current month but can sometimes be two or three months out. The Chicago Mercantile Exchange (CME Group) posts a list of gold future contracts.

If you look at the CME Group calendar for gold contracts, you will see at least one contract expiring in the current month. However, often this month’s contract is not the most actively traded in which case a future month’s contract will be used in determining the spot price.

So we have established that spot price refers to a price for immediate delivery but is determined using the “futures price”. This sounds confusing but is not uncommon in the commodity space. The spot price of oil, for example, is also determined using the oil futures contract but is used as guidance for current pricing of your gas cost at the local gas station. Similarly, the fluctuating gold spot price is used as a significant factor in calculating the price you pay or paid for various gold coins and gold bars, particularly those of bullion variety.

In order to understand the spot price, it is also important to also understand the commodity future price of gold. Commodities such as gold, silver, oil, soy beans, wheat, coffee, and even livestock to name a few all have futures contracts. The contracts allow buyers and sellers of commodities to establish prices in advance for delivery of a commodity at a future date that can be days, weeks, months, or even years in advance. These future contracts were designed as an efficient way for buyers and sellers to mitigate risk and plan future finances by essentially “locking” prices for commodities they know they will be buying or selling in the future.

In recent decades we have seen a surge in the amount of speculative and derivative trades placed in the futures market by funds and speculators who may have no intent of ever actually delivering or receiving the underlying asset. As a result, a majority of commodity futures contracts are cash-settled at expiration or they expire out-of-the-money unfulfilled.
Looking specifically at the gold futures contract used to determine the “spot price” of gold, is a standard contract for 100 ounces of gold. The delivery of gold is to be in a “COMEX good delivery bar” or a bar with at least .995 fineness delivered to an account at a COMEX facility. This type of bar is not a practical investment. Rather it is essentially a large hunk of gold a jeweler my want to refine for jewelry; a mint may want it to purify for quality coins or practical bars; a manufacturer may want it to manufacture electrical components. However, only a small percentage of gold futures contracts are now settled with actual delivery of gold. Due to high trading and speculation, most are cash settled. Therefore, that spot price of gold is primarily based on paper trading with very little trading of physical metal.

Why Does The Gold Price Still Move After The Markets Close?

Most publicly traded stocks trade on a single exchange. Apple Inc. (AAPL) trades on the NASDAQ Exchange witch trades from 9:30 AM to 4:40 PM EST. Brokers can make a market for after hours trades but trades are settled on the NASDAQ the next trading day.

Commodities, especially the major ones like crude oil and gold, trade on multiple exchanges all over the world. Gold is trading on a major exchange somewhere in the world throughout most of the day and night. Advanced spot price feeds such as the one provided by Midas Gold Group track major exchanges around the world and update with major global markets.

WHERE DOES MIDAS GOLD GROUP GATHER SPOT PRICE DATA?

Midas Gold Group draws its live spot price feed from a collection of major global exchanges in New York, Chicago, Toronto, London, Shanghai, Dubai, and Tokyo. The feed from multiple exchanges ensures maximum reliability. Our feed is also reliable in the after US hours market. When major global events are affecting the price of gold you can rely on the Midas Gold Group spot feed to keep you up to date.

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