Buying Price
Also: Repurchase Price, Bid Price, Buy-Back Price
The buying price is the price a dealer or refinery pays when purchasing precious metals from a private seller — it always falls below the current spot price.
The buying price refers to the amount that a precious metals dealer, bank, or refinery pays a private seller for their gold, silver, platinum, or palladium. It is the counterpart to the dealer's selling price and is always below the current spot price, because dealers must factor in their purchasing costs, operating expenses, and price risk.
When selling coins or bars, you should know the current gold price or silver price in order to properly assess offers you receive.
How Is the Buying Price Determined?
The starting point of every buying calculation is the international spot market price (cash price), which is established at the LBMA in London or at the COMEX in New York. From this, the dealer deducts various items:
- Trade spread — the difference between buying and selling price, covering operating costs and profit.
- Melting and assay costs — for scrap gold, jewellery, or dental alloys, the fineness must first be analysed (X-ray fluorescence analysis, fire assay).
- Price and storage risk — prices can fluctuate between purchase and resale.
- Minting premium or deduction — for collector coins with a premium price, the dealer may sometimes take market demand into account.
The simplified calculation formula is:
Buying Price = Spot Price × Fineness × Weight − Dealer Deduction
Specifically for a 14-karat gold ring with 5 g gross weight (spot price assumed at €85/g):
Fine weight = 5 g × 0.585 = 2.925 g
Material value = 2.925 g × €85/g = €248.63
Buying price ≈ €248.63 × 0.90 = €223.77 (example, 10% dealer deduction)
The precise value for your own items can be determined using the melt value calculator or the buying price calculator.
Buying Price by Product Category
The level of the discount from spot depends strongly on how easily the material can be resold:
| Category | Typical Discount from Spot | Note |
|---|---|---|
| Standard coins (Krugerrand, Philharmonic) | 0 – 3 % | High liquidity, easy authenticity verification |
| Common gold bars (LBMA Good Delivery) | 0.5 – 2 % | Can be passed on immediately |
| Small bars (1 – 10 g) | 2 – 6 % | Higher per-unit costs relative to value |
| Jewellery / 585 gold | 5 – 15 % | Melting costs + alloy analysis |
| Dental gold / Dental alloys | 8 – 20 % | Complex processing required |
| Broken gold, granules | 5 – 18 % | Highly variable depending on fineness |
Note: These ranges are indicative and vary by dealer, market conditions, and quantity.
Distinction: Spot Price, Bid Price, and Buying Price
These terms are frequently confused in everyday usage:
- Spot price — the current market price on international exchanges for immediate delivery, typically per troy ounce in US dollars.
- Bid price — the price at which a market maker buys on the interbank market; in wholesale, just a few cents below spot.
- Buying price (retail) — the actual amount a private seller receives; includes the full trade spread plus any assay and melting costs.
The spread between buying price and selling price is therefore the central quality criterion of a dealer's offer.
Tax Notes
When selling investment gold (999 bars, standard coins), no VAT applies in Germany. However, gains from private disposal transactions may be subject to tax under § 23 EStG if the holding period of twelve months has not been met and the gain exceeds the tax-free allowance. This is not tax or investment advice; please consult a tax advisor in individual cases.
When purchasing precious metals from €2,000 onwards, identity verification under the Anti-Money Laundering Act is required — the seller must then identify themselves with a valid ID.
Tips for the Best Possible Buying Price
- Obtain multiple quotes: Get at least three offers — online buyers, a local dealer, and a refinery.
- Watch the timing: Selling when the spot price is high significantly improves the absolute yield.
- Identify your product: Common coins achieve better terms than unknown pieces, because the dealer has no assay effort.
- Bundle quantities: Larger quantities are often purchased on more favourable terms.
- Know your fineness: For jewellery, it is worth knowing the fineness beforehand — for example from the hallmark (585, 750) — to better assess offers.
In Brief
The buying price is always the price from the dealer's perspective — they are buying, the private seller is selling. The more liquid and standardised the precious metal, the smaller the discount from the spot price and the fairer the achievable result. A simple comparison with the current gold price or the melt value calculator helps identify excessive deductions.