Bullion

What is 'Bullion'

Bullion is 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. 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. The gold is then extracted from the ore with the use of chemicals or extreme heat. The resulting pure bullion is also called "parted bullion." Bullion that contains more than one type of metal is called "unparted bullion."

BREAKING DOWN 'Bullion'

The price of gold bullion is influenced by demand from companies that use gold to make jewelry and other products, and by perceptions of the overall economy (for example, gold becomes more popular as an investment during times of economic instability).

Central banks and investors who hold gold typically do so in the form of bullion, but it is expensive to store and insure. Bullion is traded in the bullion market, which is primarily an OTC market open 24 hours a day. Trade volume in the bullion market is high, and most transactions are completed electronically or by phone.

RELATED TERMS
  1. Bullion Coins

    Coins made from precious metals that are generally used for investment ...
  2. Bullion Market

    A forum through which buyers and sellers trade pure gold and ...
  3. Unparted Bullion

    Bars or ingots of precious metals that contain substantial amounts ...
  4. Ingot

    A material that has been cast into a shape in order to be transported ...
  5. Gold Certificate

    A physical document resembling a paper bank note that entitles ...
  6. Hard Money

    1. Funding by a government or organization that is repetitive, ...
Related Articles
  1. Mutual Funds & ETFs

    The 4 Largest Gold ETFs (GLD, IAU)

    Learn what is behind rising gold prices, and discover the top four exchange-traded funds (ETFs) that can be used to gain investment exposure.
  2. Mutual Funds & ETFs

    (GLD) SPDR Gold Shares: Who Is Invested?

    Learn about SPDR Gold Shares, including why it may be a good way to diversify a portfolio, who owns it and how it has performed in recent years.
  3. Mutual Funds & ETFs

    The 4 Largest Silver ETFs (SLV, SIVR)

    Learn the names of the four largest silver ETFs by asset size. Discover some basic facts about each of these ETFs and what differentiates them from one another.
  4. Mutual Funds & ETFs

    Investing in Gold: Mutual Funds vs. ETFs (GLD, IAU)

    Find out the difference between gold mutual funds and gold ETFs, and how to determine which is the best gold investment option for you.
  5. Mutual Funds & ETFs

    The 3 Riskiest Gold ETFs and ETNs for 2016 (GS, DGLD)

    Learn about the gold markets, where experts see gold heading in 2016 and three of the riskiest gold ETFs to capture up or down movements in gold.
  6. Mutual Funds & ETFs

    GLD: iShares Gold Trust ETF

    Learn about the SPDR Gold Shares ETF, how it tracks the price of gold, and what type of investors may want to hold shares in their portfolios.
  7. Economics

    What Is Wrong With Gold?

    Despite its historic and symbolic appeal, this metal is simply a commodity. Here we explore its meaning as an investment.
  8. Economics

    8 Reasons To Own Gold

    This precious metal's rich history stems from its ability to maintain value over the long term.
  9. ETF Center

    The Gold Showdown: ETFs Vs. Futures

    ETFs and gold futures are two ways to diversify into the metals asset class, but there are advantages and disadvantages to both instruments.
  10. Budgeting

    The Gold Standard Revisited

    Think the value of gold is unshakable? Read this chronicle of its rise and fall.
RELATED FAQS
  1. How can I invest in gold?

    Investing directly in commodities, such as gold or oil, tends to be more difficult for investors than investing in stocks ... Read Answer >>
  2. How can I track gold prices?

    Learn how to track gold prices. Gold is a commodity traded as a physical asset and a futures contract. The one you track ... Read Answer >>
  3. What is a derivative?

    A derivative is a contract between two or more parties whose value is based on an agreed-upon underlying financial asset, ... Read Answer >>
  4. Which mutual funds made money in 2008?

    Read about the only mutual fund that turned a profit in 2008. Learn about risk-averse investment strategies and the financial ... Read Answer >>
  5. Do penny stocks trade after hours?

    Understand what qualifies as a penny stock and what qualifies as a low-priced security. Learn about after-hours trading as ... Read Answer >>
  6. Do hedge funds invest in commodities?

    Learn about hedge funds that invest in commodities. Read about Commodity Trading Advisors who focus specifically on trading ... Read Answer >>
Hot Definitions
  1. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  2. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  3. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
  4. Generally Accepted Accounting Principles - GAAP

    The common set of accounting principles, standards and procedures that companies use to compile their financial statements. ...
  5. DuPont Analysis

    A method of performance measurement that was started by the DuPont Corporation in the 1920s. With this method, assets are ...
  6. Call Option

    An agreement that gives an investor the right (but not the obligation) to buy a stock, bond, commodity, or other instrument ...
Trading Center