Understanding how precious metals markets operate helps interpret price data and market movements across the four main precious metals.
The Four Precious Metals
Gold is the most liquid precious metal and central bank reserve asset. Silver is more volatile with significant industrial use. Platinum is rarer than gold, used primarily in automotive catalysts, with South Africa as the dominant producer. Palladium has strong automotive demand with Russia as a major supplier.
Where Prices Are Set
COMEX (CME Group) is the primary US futures exchange for silver and gold with 5,000 oz silver contracts. The London Bullion Market (LBMA) is the physical market center with the London Fix prices. The Shanghai Gold Exchange is growing in influence with yuan-denominated contracts and physical delivery focus.
Understanding Price Quotes
Spot price is the current market price for immediate delivery, changing throughout the trading day. Futures prices are for future delivery, trading at contango (above spot) or backwardation (below spot). The bid/ask spread represents dealer profit, with tighter spreads indicating more liquidity.
Units and Trading Hours
Precious metals use troy ounces (31.1g, not the standard 28.35g oz). Markets trade nearly 24 hours: Asia/Sydney 6pm-2am ET, London 3am-12pm ET, New York 8am-5pm ET, plus electronic trading. This global coverage means prices react to news around the clock.