Fractional Gold

Fractional are coins or bars that have less than one troy ounce of a precious metal. They are an alternative way to invest in precious metals by buying lower quantities, thus less expense. Many coins and bars are now available in these fractional sizes, as their popularity has grown quite fast over the last few years. Thinking about adding gold to your investment portfolio? Fractionals are a great way to add it without spending a lot of money.

The most common fractional gold coins are ½, ¼, or 1/10 ounce. Many mints also offer fractionals that are measured in grams. Obviously, the smaller coin the less cost.

Advantages of fractional gold

As stated earlier, fractionals are a great way to add gold to your investment portfolio for less money. A lower cost for gold has made it more affordable for more people to invest in.

Fractional gold pieces offer more flexibility. With fractionals, you can have pieces from many different popular coin series, such as American Gold Eagles, Philharmonics, Britannias, Krugerrands, and many more. These coins often have more of an added value than other coins due to their popularity.

Gold is gold, no matter how much or how little you have in your portfolio, and it is a great defense against economic downturns. Gold is easy to liquidate if the need ever arises. And since gold will always have value, you will always have a financial backing.

The gold standard

Up until 1931, American currency was backed by our gold supply, which meant that at any time you could exchange your paper currency into that amount in gold.

During the Great Depression, more people were exchanging paper money for gold, and soon America was in danger of running out of gold reserves. To prevent this, the gold standard was abandoned that year. As per the calculations made in 2014, no nation was seen using the gold standard as the basis of the monetary system, even though most continue to hold substantial gold reserves.

How is the gold price calculated now?

Gold’s official price is set twice daily, first at 10:30 am and again at 3 pm, both GMT, except for Christmas Eve and New Year’s Day New Year and Christmas Eve when it is only set at the morning time. This ‘gold fixing,’ as it is called, is decided by the London Bullion Market Association.

Though gold fixing is used for deciding contracts between London Bullion Market members, it is also recognized as an unofficial benchmark to be used to mark gold prices globally. Some of the factors taken into consideration for determining the price of gold are:

• Economic and political uncertainty
• Supply and demand
• Central bank selling and buying
• Interest rates and inflation

Though fractional coins have a slightly higher markup price than an ounce or more of gold, fractional gold coins can prove to be smart investment pieces. For less money, you can add the stability of gold and the value of popular gold coin series.

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