Gold Accounts

Gold Accounts

Gold Accounts are special type of investment accounts offered by some financial institutions, which can be used to trade and hold gold. There are 2 kinds of gold accounts – allocated gold accounts and unallocated gold accounts.

Unallocated Gold Accounts

The unallocated gold accounts are gold accounts with a bank or a bullion dealer, through which investors buy and sell gold, but the gold holdings of each particular investor are not allocated. This simply means that if an investor has an unallocated gold account with 1000 ounces of gold, there are no specific gold bars or coins allocated for his holdings. The financial institution managing unallocated gold accounts has the right to lease the gold held in such accounts. The unallocated accounts do not have insurance and storage fees, which is a plus for investors.

Allocated Gold Accounts

The allocated gold accounts are similar to the unallocated gold accounts, but specific gold bars and/or gold coins are allocated for each investor. The investor owns the allocated gold and the financial institution or bullion bank maintaining the gold account cannot lease, lend or trade the allocated gold. Maintaining allocated account is more expensive because the gold account owner has to pay for storage and insurance.

Gold Pool Accounts

Most bullion banks will never allow you to hold less than 1,000 troy ounces of gold in allocated or unallocated account. The Gold Pool Accounts are intended for small investors who want invest in gold, but will hold less than 1000 ounces of gold. Most Gold Pool Accounts allow investors to own as little as 1 troy ounce of gold.

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