Finally, I Bought an American Buffalo Gold Coin
I finally did today what I have long been considering doing: Buy gold. Today the waiting is officially over after I bought an one ounce American Buffalo gold coin from Bullion Direct, at the time when recent selling pressure has pushed the spot gold price from a nine-month high of $689 reached early this week down to about $640 this morning when I placed the order.
The reason for me to choose Bullion Direct over other bullion dealers after my recent study is mainly for their price, price of the metal and additional charges related to shipping and insurance. Between Bullion Direct and Kitco (APMEX is another choice among many gold dealers, but I didn’t go through them all and concentrated only on Bullion Direct and Kitco instead), it seems Bullion Direct offers better value. As of now, one ounce American Buffalo gold coin is listed at $670.20 while Kitco has a quoted price of $677.63. Other key differences include:
- Waiting period after payment is received: Kitco – 3 weeks; Bullion Direct – 7 days
- Shipping & handling: Kitco – $30 flat; Bullion Direct – $5.95 handling plus $9.49 and up shipping
- Insurance: Kitco – $4 per $1000; Bullion Direct – free
Actually, after I posted the article on buying gold early last month, I was approached by Bullion Direct, pointing out, for example, that the 4% handling fee is only for credit card payment, not for check or wire.
So I eventually decided to go with Bullion Direct and the whole shopping experience was very smooth. The account opening process only took a couple of minutes to complete (information required include name, address, phone number, date of birth, and credit card information for authentication, won’t be charged if not selected as payment method). When I first put the coin in the shopping cart, the price was quoted at $673.50. As I was reviewing the order before submitting it, I was warned that I have two minutes to confirm the order, otherwise a new real time price will be quoted. It took me longer than two minutes before I hit the submit button and a new quote was displayed on my order: $669.70. Even better! At that time, the spot gold price was around $646 an ounce and the difference between quoted price and spot price is the premium that dealer charges. Including shipping and handling, the final cost of the American Buffalo gold coin is $685.14. I bought the coin through their catalog service. Though it is possible that I can get a better price through their auction style services, I chose catalog just for simplicity.
This is the first time I have bought a piece of gold, but I have no plan to make frequent investment into physical gold (my mutual fund TGLDX provides me the diversification I need already).
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