Glossary of Terms

Alloy – A mixture of two or more metals.

Assay – The testing of a metal to determine its purity.

Aureas – A gold coin minted from the first century B.C. to the third century A.D. in ancient Rome, about the size of a silver denarius or modern dime and worth 25 denarii.

Backwardation – A market condition in which the spot price of a metal is more expensive than the price guaranteed for the metal at a future date, often caused by a shortage.

Bear market – A market in which the trend of an asset is downwards.

Bull market – A market in which the trend of an asset is upwards.

Bullion – A highly pure form of precious metal, often in the form of bars or coins, collected for investment purposes.

COMEX – Formerly known as the Commodity Exchange Inc., it is the world’s largest exchange where metals such as gold, silver, and copper are traded. It is a subsidiary of the CME Group.

Correction – A market downturn following a market rise, often for a brief time.

Double Eagle – A large coin made of 90 percent gold and 10 percent copper containing .9675 troy ounces of gold that circulated in the U.S. between 1850 and 1933. The reverse of these coins depicts a bald eagle.

Fiat money – Money that is unbacked by gold or any commodity.

Fineness – The ratio of a precious metal by weight relative to other metals or substances in an object.

Gold – A yellow precious metal with an atomic number of 79 with industrial and non-industrial uses.

Gold is an element with an atomic number of 79.

Goldsmith – A person who makes gold objects.

Gold standard – A monetary system in which a unit of currency is backed by a specific weight of gold. The gold standard was ended in the U.S. in 1971.

Gold-to-silver ratio – The ratio of the value of gold relative to silver by a unit of weight.

Karat (or carat) – A measure of gold purity, with pure gold being 24 karats. Each karat is one unit of 24 parts.

Luster – The shine on a surface of a mineral.

Metric ton – a unit of weight that equals 1,000 kilograms, or 2,205 pounds.

Ore – A rock or mineral from which a metal is mined or extracted.

Solidus – A gold coin introduced in ancient Rome by the emperor Constantine I in 301 A.D. and that contained 4.5 grams of gold per coin, eventually replacing the aureas.

Spot price – The price of a metal at the time of delivery.

Troy ounce – A unit of weight for precious metals that equals 31.1035 grams.

Vermeil – Silver with a gold wash or exterior layer. Also, this can be referred to as “gilded.”