An assay is a process of analyzing a substance to determine its composition or quality. 

What is the Precious Metals Delivery Process?

An assay is a process of analyzing a substance to determine its composition or quality. Metals that are used to meet delivery requirements of futures contracts must be assayed to ensure that they meet the stringent quality and purity requirements mandated by the futures exchange. For example, the CME group, which has gold futures listed on its platform, requires a minimum fineness of the metal of 995, or 995 parts per thousand, for delivery in the COMEX gold futures. There are three main techniques used to assay minerals: fire assay, wet chemistry, and instrumental analysis. Assays are used in futures markets to meet delivery requirements for metal futures, as specified by exchanges.

Assay

Base metals, such as aluminum, copper, and zinc, are widely used in commercial and industrial applications, such as construction and manufacturing.

North American market price of lead from 2013 to 2020 (in U.S. cents per pound)

CME Group All Products – Codes and Slate: Base Metals

Product Summary: iPath® Bloomberg Industrial Metals Subindex Total ReturnSM ETN

Global prices of base metals in 2019, by commodity type

Base metals are common metals that tarnish, oxidize, or corrode relatively quickly when exposed to air or moisture. Several base metals futures trade on commodities markets, and there are also ETFs available for ordinary investors that track base metals. While iron corrodes and rusts when exposed to water and air, base metals exclude iron by referring only to non-ferrous industrial metals. Unlike precious metals, base metals tend to tarnish, oxidize, or corrode over time or when exposed to the elements. The term base metals likely arose because these materials are inexpensive and more commonly found than precious metals, such as gold, silver, and platinum.

Base Metals

Bullion coins are coins made from precious metals. They are typically minted in fractions of one troy ounce, most commonly from gold and silver.

Bullion coins are coins made from precious metals. These coins are minted from 22 karat gold (91.67% purity) and are available in four weights—one-tenth, one-fourth, one-half, and one troy ounce.
Other popular gold bullion coins include the Canadian Maple Leaf, South African Krugerrands, and Chinese Gold Pandas. American Eagle gold bullion coins are among the most widely traded bullion coins in the world. For collectors, bullion coins can be prized for their rarity and aesthetic beauty, which can often cause their value to increase relative to the base value of their precious metals content. Many countries have their own official bullion coins, such as the American Eagle series produced by the United States Mint or the Canadian Maple Leaf series offered by the Royal Canadian Mint.

Bullion Coins Defined

A bullion market is a market through which buyers and sellers trade gold and silver as well as associated derivatives.

A bullion market is a market through which buyers and sellers trade gold and silver as well as associated derivatives. There are various bullion markets dotted around the world, although the London Bullion Market is known as the primary global market trading platform for gold and silver. There are many bullion markets, but the primary market is the London Bullion Market, which allows trading 24 hours a day and facilitates futures and options trading. It is an OTC market open 24 hours a day that transacts gold and silver at market spot prices, and also includes trading of forwards and options on the metals. The bullion market is generally known as the market for gold and silver trading.

Bullion Market

Bullion refers to gold and silver that is officially recognized as being at least 99.5% pure and is in the form of bars or ingots rather than coins.

INFORMATION BULLETIN #50 SALES TAX JULY 2017

Table of Contents
What Is Bullion?
Understanding Bullion
How Banks Lend and Sell Bullion
The Bullion Market
Buying and Investing in Bullion LBMA members include banks such as:
Bank of Nova Scotia (BNS)
UBS Switzerland AG
JPMorgan Chase & Co.
Morgan Stanley
Royal Bank of Canada (RBC)
Merrill Lynch
Goldman Sachs
Bank of Montreal (BMO)
BNP Paribas
HSBC or the Hong Kong and Shanghai Banking Corporation
Standard Chartered Bank
When a central bank lends gold to bullion banks for a specified period, say three months, it receives the cash equivalent of the gold lent to the bullion bank. The bullion bank hopes that by the time it’s scheduled to repurchase the gold from the spot market, the price of bullion will be lower so that the bank can buy it back at a lower price than it had originally sold it. To create bullion, gold first must be discovered by mining companies and removed from the earth in the form of gold ore, a combination of gold and mineralized rock. Although it's not equivalent to owning gold, investing in gold or silver through exchange-traded funds (ETFs) allows investors access to the bullion market.

Bullion

Copper is a reddish-gold colored metal that is ductile, malleable and an effective conductor of heat and electricity. 

Chairman's Speech. 52nd Annual General Meeting

Copper is a reddish-gold colored metal that is ductile, malleable, and an effective conductor of heat and electricity. All U.S. coins are now copper alloys, and gun metals also contain copper. Copper prices are determined by a number of factors, including demand from emerging economies such as China and India along with the U.S. housing market. Economic indicators that influence U.S. housing demand_—_including nonfarm payrolls, mortgage rates, GDP figures, and demographics_—_also influence copper demand. For example, the COMEX Copper Futures contract is a monthly futures contract with physical delivery of 25,000 pounds of copper on expiration.

Copper

Doctor Copper is a slang term for copper's price to predict the overall health of the economy.

The term Doctor Copper is market lingo for this base metal that is reputed to have a "Ph.D. in economics" because of its ability to predict turning points in the global economy. Generally, rising copper prices suggest strong copper demand and, hence, a growing global economy
When copper prices decline it may indicate sluggish demand and an imminent economic slowdown. For example, a temporary shortage of copper may lead to rising prices even as the global economy is slowing down; conversely, a copper glut may cause lower prices despite robust economic growth. Because of copper's widespread applications in most sectors of the economy — from homes and factories to electronics and power generation and transmission — demand for copper is often viewed as a reliable leading indicator of economic health. Doctor Copper, which is in fact a concept rather than a person, is often cited by market and commodity analysts as having a strong ability to assess overall economic well-being through the price of copper because of the metal's wide-ranging application in industrial production and electrical equipment.

Doctor Copper

An ingot is a material that has been cast into a shape in order to be transported and processed easier than in an unprocessed form. 

An ingot is a material cast into a shape to facilitate transportation and processing. As with all other types of bullion bar, gold ingots are required by the LBMA to contain 99.5% pure gold, i.e., 995.0 parts per thousand of fine gold ﻿﻿﻿ The LBMA was founded in 1987 by the Bank of England, the market’s regulator at the time. Tin ingots are the starting material for numerous products, whether the tin will be alloyed with other metals, converted to other forms, applied to the surfaces of other metals, or converted to chemical compounds. Ingots are most commonly associated with metals; in fact, ingots of gold held in the vaults of banks and brokerages are popular images. The association is responsible for the regulation of refining standards, trading practices, and the certification of the bullion used to make gold and silver bars and coins.

Ingot

Iridium is a rare and expensive corrosion-resistant metal. Discover why iridium is used in the manufacture of aircraft, spark plugs, and tech devices. 

Average Iridium Price Worldwide from 2000 to 2020

How Palladium Became a Really, Really Precious Metal

Table of Contents
What Is Iridium?
Understanding Iridium
History of Iridium
Applications of Iridium Iridium’s very high melting point makes it useful in many industrial applications, like the construction of high-grade spark plugs used in general aviation aircraft. Both iridium and palladium have high melting points, high electrical conductivity, and extreme corrosion resistance, making both metals highly practical for electronics and industrial applications. Due to its high electrical conductivity and resistance to corrosion at high temperatures, iridium is frequently used to tip spark plugs, the devices that ignite the fuel-air mixture in combustion engines.

Iridium

The London spot fix is a daily rate set of each precious metal set by European banks.

The London spot fix is a daily price per ounce for each of the precious metals (gold, silver, platinum and palladium) determined by a brief conference call among the five members of the London Gold Pool. The London spot fix is a daily price per ounce for each of the precious metals (gold, silver, platinum and palladium) determined by a brief conference call among the five members of the London Gold Pool. The London spot fix price is the price fixed at the moment when the conference call terminates. Because other derivatives and products are priced in terms of gold, the London spot fix remains an important aspect of daily trading. Members of the London Gold Pool belong to the London Bullion Market Association (LBMA) and are the five largest players in the gold bullion market.

London Spot Fix

The London Metal Exchange (LME) is a commodities exchange in London that deals in metal futures contracts.

CME Group Inc. to Acquire NYMEX Holdings, Inc. on Terms Previously Announced

CME Group to Close New York Trading Floor at Year-End

Why the CME Shutting Down Floor Trading Matters

Table of Contents
What Is the London Metal Exchange (LME)? Understanding the London Metal Exchange (LME)
History of the LME
Trading Metals on the LME
LME and Ring Trading
Example of LME
The Bottom Line Hedgers and speculators are active on the metals exchange, with hedgers turning to futures and options to mitigate risk and speculators seeking to make short-term profits by taking on risk.
The LME is the only remaining physical commodities trading market in Europe, as the trend has been moving steadily to electronic trading and away from open outcry. The LME has three methods of trading metals: open outcry, through the LME Select electronic trading platform, or by telephone systems. Located in London, England, the LME is the world center for industrial metals trading, with the majority of all non-ferrous metal futures business transacted on the exchange.

London Metal Exchange (LME)

The mint ratio, or gold/silver ratio, is the price of an ounce of gold divided by the price of an ounce of silver.

Gold to Silver Ratio - 100 Year Historical Chart

The mint ratio, or gold/silver ratio, is the price of an ounce of gold divided by the price of an ounce of silver, and is the exchange rate between the two precious metals. The mint ratio, or gold/silver ratio, is the price of an ounce of gold divided by the price of an ounce of silver, and is the exchange rate between the two precious metals. Mint ratio is the price of an ounce of gold divided by the price of an ounce of silver and is equal to the exchange rate between the two precious metals. Traders pay particular attention to the mint ratio when it reaches extremes, because the gold/silver ratio has always been mean reverting. Historically, when currencies were based on gold and silver holdings, the gold/silver ratio was fixed.

Mint Ratio

Mr. Copper is a nickname for Yasuo Hamanaka, a Japanese copper tycoon responsible for the the greatest unauthorized trading loss in history. 

CFTC Files and Settles Against Sumitomo Corporation for Manipulating the Copper Market in 1995-96

Mr. Copper was a popular nickname for Yasuo Hamanaka when he used his position as head of the metal-trading division of the Japanese trading company, Sumitomo, to corner the world copper market. Before being revealed as the rogue trader who was ultimately responsible for $2.6 billion in losses for Sumitomo, Hamanaka was widely admired for his copper market investment strategies, which made Sumitomo a world leader in copper in spite of the fact that the company had no copper mines of its own. Mr. Copper, or Yasuo Hamanaka, rose to prominence in the mid-1980s by making Sumitomo the largest copper trader in the world thanks to aggressive and illegal investment strategies in copper futures and options. Because copper is an illiquid commodity, the 5% copper holdings of Sumitomo put them in a dominant worldwide position, essentially giving them the ability to control the world copper price through the London Metal Exchange. Mr. Copper was a popular nickname for Yasuo Hamanaka when he used his position as head of the metal-trading division of the Japanese trading company, Sumitomo, to corner the world copper market.

Mr. Copper

Palladium is a shiny, silvery metal used in many types of manufacturing processes, particularly for electronics and industrial products. 

Palladium is a shiny, silvery metal used in many types of manufacturing processes, particularly for electronics and industrial products. The majority of the world's supply of this rare metal, which has the atomic number 46 on the periodic table of elements, comes from mines located in the United States, Russia, South Africa, and Canada. Along with platinum, rhodium, ruthenium, iridium, and osmium, the metal is part of a group known as platinum group metals. Palladium, platinum, rhodium, ruthenium, iridium, and osmium form a group of elements referred to as the platinum group metals (PGMs). The largest industrial use for palladium is in catalytic converters because the metal serves as a great catalyst that speeds up chemical reactions.

Palladium

A chemical element, precious metal and commodity used primarily in jewelry, electronics and automobiles. 

Effects of the 2008 Financial Crisis on the Linkages Among the Oil, Gold, and Platinum Markets

Platinum is a chemical element, precious metal, and commodity that manufacturers use primarily for jewelry, electronics, and automobiles. However, while platinum traded at a significant premium to gold for decades, it has not since 2008; as a weak global economy put a damper on demand for the precious metal, but investor unease about central bank stimulus and other economic matters sent gold prices higher. The price of platinum has been trending lower since the 2007-2008 financial crisis, as investors show greater interest in other metals like gold and South African mines have substantially increased production of platinum. In the United States, platinum engagement rings are a popular alternative to white gold engagement rings, which are composed of gold, alloys, and a rhodium plating that gives them a white look. Platinum futures are commodities contracts traded on the CME's COMEX futures exchange (under symbol PL) and the Tokyo Commodity Exchange.﻿﻿ ﻿﻿ It is also possible to invest in platinum by purchasing shares of an exchange-traded fund that specializes in the commodity.

Platinum

A silver certificate was a form of legal tender issued by the U.S. government beginning in 1878 and continuing through the 1960s. 

A silver certificate is a type of legal tender in the form of paper currency that was issued by the U.S. government beginning in 1878. In March 1964, the U.S. Treasury Secretary announced that silver certificates would no longer be redeemable for silver dollars, and the government stopped printing them soon after.
Although the U.S. stopped minting silver coins in 1806, both gold and silver coins were usable as legal tender until 1861. They represented ​​​​​a stated amount of silver bullion purchased or held by an investor and were deemed payable to the bearer upon demand.
The first releases of the silver certificate notes were a larger size than their subsequent counterparts, which were similar in dimensions to the modern U.S. paper currency in circulation today. In the end, the gold backers won the white house and the discussion, and the USD went on the gold standard, ending bimetallism, demonetizing silver, and ushering in the issuance of silver certificates. In March 1964, the U.S. Treasury Secretary announced that silver certificates would no longer be redeemable for silver dollars.

Silver Certificate

A silver exchange-traded fund (ETF) invests primarily in raw silver assets, which are held in a trust by the fund manager or custodian. 

A silver exchange-traded fund (ETF) invests primarily in hard silver assets, which are held in trust by the fund manager or custodian. Established typically as grantor trusts, silver ETFs allow each share represented by the ETF the specific right to a particular quantity of silver, measured in ounces.​​​
A silver exchange-traded fund (ETF) invests primarily in hard silver assets, which are held in trust by the fund manager or custodian. Investors purchase shares in the physical silver held by the trust, and the fund charges a 0.50% annual management and sponsor fee to hold the silver.
Global X Silver Miners ETF (SIL) offers a different take on silver. A silver exchange-traded fund (ETF) invests primarily in hard silver assets, which are held in trust by the fund manager or custodian. Because silver ETFs are considered to be investments in the raw metal itself, gains are assessed on silver as a collectible and are subject to up to a 31.8% long-term capital-gains rate.

Silver ETF

The silver standard is a monetary system in which the value of a country's national currency is backed by silver.

The silver standard is a monetary system in which the value of a country's national currency is backed by silver. After all, since silver is finite and must be physically mined and minted, governments under a silver standard are limited in their ability to create new currency because they must ensure that all new currency is backed by an appropriate amount of silver. For proponents of the silver standard, allowing currency-holders to exchange their currency in favor of physical silver serves as a counterbalance against the tendency of governments to degrade the value of their currency by printing money. The silver standard is a monetary system in which the value of a country's national currency is backed by silver. The typical method for implementing a silver standard is to allow units of national currency to be converted into units of silver at a fixed exchange rate.

Silver Standard Defined

Silver is an element commonly used in jewelry, coins, electronics, and photography; thus, it is seen as a highly valuable substance.

Silver Prices - 100 Year Historical Chart

In Answer to Inquiries Concerning 1964 90% Silver Dollar Coins

The term silver refers to a precious metal commonly used in the production of jewelry, coins, electronics, and photography. If the price of silver is $20 per ounce, these silver coins are worth approximately 14 times their face value in the precious metal content alone. A silver dime is worth $1.40, whereas a silver dollar is worth $14 at a $20-per-ounce price. Many silver companies own and operate their own mines, where they mine for silver and other precious metals. Consider an investment backed by silver like an ETF, which is easier to sell and doesn't require you to find a place to store your silver.

Silver

In finance, the term "Silver Thursday" refers to March 27, 1980, an infamous trading day in which the price of silver collapsed.

Silver Fixing Price 12:00 Noon (London Time) in London Bullion Market, Based in U.S. Dollars

In finance, the term "Silver Thursday" refers to March 27, 1980, an infamous trading day in which the price of silver collapsed. The collapse was precipitated by the failed attempt of three brothers—Nelson Bunker Hunt, William Herbert Hunt, and Lamar Hunt—to corner the market in silver. The Hunt brothers inherited a large fortune from their father, Haroldson Lafayette Hunt Jr., a billionaire who made his fortune in the oil market. The Hunt brothers, who despite their own fortunes had relied heavily on margin loans to fund their silver purchases, were faced with severe losses on their position. In the broader silver market, prices remained in the range of $4 to $6 per ounce for most of the 1990s, before rising to a recent high of over $40 per ounce in 2011.﻿﻿ Over the past five years, however, prices have ranged between approximately $15 to $25 per ounce.

Metals

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Terms in Metals