How is the Gold Spot Price Set?
WHO SETS THE GOLD SPOT PRICE?
When you examine how the worldwide Gold spot price is determined, you will see that it is quite complex. The massive Gold proxies and derivative leverage involved in determining the Gold price have made the process so convoluted that even experts believe that it is becoming impenetrably difficult to understand.
The entities with the most influence over the Gold spot price do not generally exchange physical Precious Metal, but instead use derivative commodity contracts to determine the price of Physical Gold.
WHY IS THE SPOT PRICE CONSTANTLY UPDATING?
Right now, COMEX in the United States is the largest influencer of the daily Gold spot price, because the COMEX division of the New York Mercantile Exchange is still the most significant futures contract trading market for Gold. Some experts argue that the COMEX’s current influence on the spot price of Gold is ultimately a mirage and not really based on market fundamentals.
GOLD SPOT PRICE IN REVIEW
In short, the fluctuating Gold spot price is composite of the world’s futures markets representing the underlying real world Precious Metal price. The market for Physical Gold, such as that in the form of bullion items available for purchase at APMEX, tracks the Gold spot price religiously, and Gold bullion product prices tend to hover just over the spot price of Gold. This is a way to be aboveboard with buyers.