Buying Price
Also: Repurchase Price, Bid Price, Buy-Back Price
The buying price is what a dealer or refinery hands over when it buys metal from a private seller — and it always sits under the prevailing spot price.
The buying price is the sum a bank, precious-metals dealer or refinery will pay a private individual for their gold, silver, platinum or palladium. Think of it as the flip side of the dealer's selling price: it invariably comes in under the live spot price, because the buyer has to build in acquisition costs, running overheads and the risk of the market moving against them.
Before you part with coins or bars, check the day's gold price or silver price so you can judge whether the offer on the table is fair.
How Dealers Arrive at the Buying Price
Every calculation starts from the worldwide spot (cash) quotation set at the LBMA in London or the COMEX in New York. Working down from that benchmark, the dealer subtracts several components:
- The trade spread — the gap between buy and sell prices that funds overheads and profit.
- Melting and assay charges — with scrap gold, jewellery or dental alloys, the fineness first has to be established (X-ray fluorescence analysis, fire assay).
- Price and holding risk — the quote can shift in the window between purchase and resale.
- A minting mark-up or discount — for premium collector coins the dealer may factor current market appetite into the price.
Boiled down, the arithmetic looks like this:
Buying Price = Spot Price × Fineness × Weight − Dealer Deduction
Take a concrete case, a 14-carat gold ring weighing 5 g gross with spot 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)
To pin down the figure for your own pieces, run them through the melt value calculator or the buying price calculator.
How the Discount Varies by Product
How far below spot you land hinges largely on how readily the dealer can move the item on again:
| 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.
Telling Spot Price, Bid Price and Buying Price Apart
In everyday conversation these three often get muddled up:
- Spot price — the live exchange quotation for immediate delivery, usually stated per troy ounce in US dollars.
- Bid price — the level at which a market maker buys on the interbank market, sitting mere cents under spot in wholesale trade.
- Buying price (retail) — the amount actually paid out to a private seller, carrying the whole trade spread plus any assay and melting fees.
That is why the spread separating the buying price from the selling price is the single most telling gauge of how good a dealer's offer really is.
Tax Notes
Under the EU VAT Directive 2006/112/EC, investment gold in Malta (999 bars, standard coins) carries no VAT. Silver, platinum and palladium, however, attract Malta's standard VAT rate of 18%. As a private seller you also come out ahead on income tax: Malta imposes no capital gains tax when you dispose of movable private assets such as bullion and coins, so profit from selling your own gold or silver goes untaxed. This is not tax or investment advice; please consult a qualified adviser in individual cases.
By way of comparison, Germany may tax profits from a private sale under § 23 EStG where a twelve-month holding period has not elapsed — a rule that has no bearing in Malta.
When they buy, Maltese dealers operate under anti-money-laundering obligations and can insist on identity verification for larger deals — meaning the seller has to prove who they are with valid ID.
Getting the Highest Buying Price You Can
- Shop your metal around: collect a minimum of three quotes — an online buyer, a bricks-and-mortar dealer and a refinery.
- Mind the market: cashing out while spot is elevated lifts your absolute return noticeably.
- Know what you're holding: well-known coins fetch keener terms than obscure pieces, since the dealer skips the assay work.
- Sell in bulk: dealers frequently offer sharper terms on larger lots.
- Establish the fineness: with jewellery it helps to read the fineness off the hallmark (585, 750) beforehand so you can weigh up offers with confidence.
In Brief
The buying price is always framed from the dealer's side of the counter — they buy, the private individual sells. The more standardised and easily traded the metal, the slimmer the discount off spot and the fairer the payout. A quick glance at the current gold price or a pass through the melt value calculator makes over-large deductions easy to spot.