It has long been a staple of the global commodities market where it is traded in its bullion form for hundreds of thousands of pounds a time by speculators and investors from across the world.
But now ordinary consumers will be able to buy tiny fractions of gold bars from the Royal Mint in a bid to open up the world of gold trading, with prices starting at just £20 for a sliver of the precious metal.
We hope to expand this audience of investors furtherMartin McDade, Royal Mint
The Mint said its new “signature” gold service will allow customers to buy gold in “quantities to suit all budgets”, allowing people to purchase and own a fractional amount of a 400oz gold bullion bar, which trades for around $475,000 (£311,000) on the international market in its whole form. A bullion trading website was launched last autumn, enabling customers to buy, store and sell bullion directly from the Mint, which has a 1,000-year history of producing British coinage.
The new signature gold service will expand on this but rather than buying a coin or a bar outright, people will also now be able to buy gold based on value rather than weight, with an entry level of £20.
The royalmintbullion.com website constantly updates live prices for gold and silver, helping budding investors as well as those who are more experienced to pick the most favourable moment to buy.
However, customers will not be able to hold their tiny purchase in their hands because all bullion purchased via signature gold will be stored in “the vault” – the Royal Mint’s on-site storage facility which is protected around the clock by the Ministry of Defence.
The Mint will charge a “management fee” for signature gold customers of 0.5 per cent plus VAT per year based on the value of the customer’s gold holding being stored.
It said the fee covers the cost of holding the gold in the high-security vault, insurance and administration.
The Royal Mint said customers will hold full legal title over every ounce of gold they purchase and can buy and sell it back to the Mint as they choose.
The Mint has previously sold collectable coins direct to the public which commemorate special events, such as the birth of Princess Charlotte when special edition gold coins, made to the highest specification, were put on sale for £80 – despite the value of the gold they contained being worth less than £10.
However, last year, the Mint began selling “bullion” coins, such as Sovereign, Britannia or Lunars to the public, which are made specifically for investment purposes.
Martin McDade, the Royal Mint’s director of bullion, said: “The launch of our online bullion platform last September opened up gold trading to an audience that may previously have been put off by the perceived complexities of the market.” He added: “With the introduction of signature gold, we hope to expand this audience even further.”
Gold has become an increasingly popular investment in recent years, as a hedge against inflation and stock market movement at a time when traditional stocks and shares have been volatile, amid changing economic situations worldwide.
However, the price of the metal, which does not usually move in line with other assets such as equities or property, has dropped in recent weeks.