When checking precious metal prices, investors often encounter different concepts such as US dollars per ounce, bid price, ask price and real-time price. Starting from quotation structure, this article by Lucky Gold helps new investors understand how to read gold and silver prices, and why figures obtained from different sources may sometimes have slight discrepancies.
What units are commonly used for precious metal prices?
International gold and silver prices are commonly quoted in US dollars per ounce. The "ounce" here generally refers to the troy ounce, a weight unit widely adopted in the precious metals market. Therefore, when you see a gold price quoted in US dollars, it usually represents how many US dollars each ounce of gold is worth. In different regions, investors may also see other quotation formats such as RMB per gram and HKD per tael. Since these quotation units differ, the numerical values cannot be directly compared.
Why are both bid price and ask price displayed?
A precious metal price query page usually does not show only one single figure. Both bid price and ask price may be displayed at the same time. This is because buyers and sellers in the market quote different prices, forming a spread between the two. Therefore, when viewing quotations, investors need to clarify whether the page shows the market mid-price, bid price or ask price. Otherwise, it is easy to mistakenly believe that quotations on different platforms are completely inconsistent.
What is real-time price?
The so-called real-time price generally refers to quotations continuously updated by the market data system as market transactions change. However, minor differences in update speed may exist across different data sources and network environments. Accordingly, tiny quotation gaps when checking precious metal prices on different websites at the same time do not necessarily indicate faulty data. What truly requires attention is whether the data remains unupdated for a long time, or has an obviously abnormal deviation from mainstream international market prices.
Why do gold prices displayed on different websites not match exactly?
There is no single global quotation page for the precious metals market that stays fully synchronised and identical across all channels forever. Different data providers, liquidity sources and update timestamps may lead to minor differences in displayed prices. In addition, some platforms show bid prices, some show mid-prices, while others display quotations specific to their own trading products. Hence, when comparing precious metal prices from different sources, you must first confirm the quotation type.
What is the difference between international gold price and local gold price?
The international gold price is normally quoted in US dollars per ounce. Local retail gold prices may also be affected by exchange rates, processing costs, retail charges and local supply and demand. Therefore, a rise in the international gold price does not mean local gold jewellery prices will change by exactly the same proportion. When checking precious metal prices, investors need to clarify whether they are viewing investment market prices or retail gold prices.
Why does the silver price appear much lower numerically than the gold price?
There is a substantial gap between the per-ounce prices of gold and silver, determined by the market supply and demand, scarcity and applications of the two metals. Nevertheless, a lower numerical price does not mean silver carries lower risks. Silver prices sometimes fluctuate even more sharply. Thus, investment difficulty cannot be judged merely by its "low price".
What else should you check besides the price?
Apart from the current quotation, you may also check the day’s high, day’s low, opening price and price change percentage. These figures help assess where the price stands within the trading day. The market condition is clearly different when the current price is near the daily high versus near the daily low. Moreover, you can examine longer-term price charts to avoid judging the market based solely on a momentary figure.
What is the biggest misconception when checking precious metal prices?
One of the biggest misconceptions is to immediately predict future market direction upon seeing price movements. Price checking is only the first step to understand the current market status. Genuine market analysis also needs to incorporate factors including the US dollar, interest rates, economic data, supply and demand, and technical trends. The purpose of checking precious metal prices is to inform investors of the market’s current position, rather than directly telling investors where the market will definitely move next.
Gold and silver prices keep changing with the market. When viewing quotations, investors should pay attention to quotation units, data update time and price types, and avoid making judgements based on a single figure alone.