BullionVault definition

Spread

The difference between the buying and selling price is called the spread.

Most businesses make most of their money from the spread. They can do this because all the trades are dealt direct with them. This encourages them to make a wider spread.

A key feature of BullionVault is that you can quote prices on the order board, and deal direct with other users.

Your access to the spread forces BullionVault to compete vigorously and keep spreads low. The power of this is seen by the fact that competing spreads on small retail gold quantities are in the $20-$40 range elsewhere, and typically $1.5 - $3 on BullionVault (all figs for troy ounces).

The average spread on BullionVault is zero - because half of users pay it, and half earn it.

An example:

If the price is quoted $18,000 - $18060 per kilo and you want to buy you can bid $18,001. You will have become the best buyer for another BullionVault user to sell to, and as the first to post the price you are guaranteed to be the first to buy at it.

Of course your risk is that the market keeps going up, and soon someone else posts an even higher bid price, so you don't get to deal. But that's the risk that market professionals take all the time in order to earn the spread. It's up to you. Be aggressive and pay the spread, or be patient and try to earn it. Only BullionVault gives you the choice.