Frequently Asked Questions
1. Why own, buy or sell gold and silver?
Gold and silver are (real) money — for 5,000 years they have served as a means of payment and helped preserve the value of people’s wealth. The purchasing power of paper money shrinks over time until it eventually disappears, while gold and silver retain their value. Investment gold and silver are convertible into local currencies worldwide, typically at rates close to the world market spot price.
2. Which metals are considered precious metals?
The main precious metals are gold, silver, platinum and palladium.
3. What is the correct unit of weight for gold and silver?
The internationally accepted unit of weight for precious metals (and the global standard for exchange prices) is the troy ounce, marked "oz". One troy ounce equals 31.1035 grams, so 1 oz of gold or silver is about 31.1 grams. Beginners may find it confusing that many countries also use the regular ounce for other goods, which equals 28.35 grams and makes up 1/16 of an English pound. In Estonia and many other countries, grams and kilograms are also commonly used to define the weight of precious metals, especially in physical retail.
4. In which currency are precious metal prices expressed?
In local retail markets, precious metal prices are usually described in the local currency — for example the euro in Estonia and the rest of the eurozone. Internationally, precious metal prices are expressed in US dollars, for historical reasons: during World War II, countries agreed that the US dollar would be the world’s reserve currency, tied to gold (1 oz of gold = 35 USD). All other currencies were pegged to the US dollar. In August 1971, President Nixon announced the end of the dollar’s link to gold, but the US dollar remained the world’s reserve currency. The depreciation of the USD — and of all other fiat currencies — against gold has been a constant and continuing trend since 1971.
5. What is the purity of a precious metal and how is it expressed?
Purity means the content of the specific precious metal in the alloy.
The purity of investment gold and silver is expressed in parts per thousand. The world’s most common investment coins and bars are practically free of other elements: a purity of 999.9 means that only one part per thousand is residue of another metal, which would not even be practical to refine out. For gold jewellery, purity is expressed in carats: 24 carats = pure gold, so 12 carats = an alloy containing 50% gold and 50% other elements (copper, silver, nickel, etc.). Older readers may remember the Soviet-era hallmark 583 often found on gold jewellery, meaning the alloy contained 58.3% gold.
6. In what form and which precious metals does Goldman & Sons sell and buy?
Goldman & Sons currently focuses on investment gold and silver in the form of coins and bars. We plan to expand the selection over time — for example, we intend to introduce 1/2 oz and 1/4 oz silver coins in the near future.
7. What are investment gold and silver? What distinguishes them from "ordinary" gold and silver?
Investment-grade precious metal meets conditions that distinguish it from everything else:
a) The name of the metal and its purity are minted on the product (an untrained eye may not tell a silver and a platinum coin apart).
b) The weight of the product is minted on it.
c) The product carries a reference to its producer.
8. Why isn’t the product selection on the Goldman & Sons website very large?
From an investment perspective we want to focus on what matters most, so we only offer the world’s best-known and most liquid investment coins and bars, whose price is simply the current price of the metal itself. We deliberately exclude products with numismatic or artistic added value: their selling price is higher, but the buy-back price is still the same as for a standard investment coin or bar, because it is based solely on metal content.
9. Do you ask customers for an identity document, and on what basis?
We ask to see an identity document for reasons arising from the law and our customer policy. If a customer has paid by bank transfer, the goods must be collected by the person who made the transfer. If the payer is a legal entity, we must make sure we hand the goods over to its legal representative. For all cash transactions we ask for the customer’s name and e-mail address, and for cash transactions exceeding 5,000 EUR we identify the customer on the basis of an identity document. If the transaction exceeds 10,000 EUR, the additional due-diligence measures of the Estonian Money Laundering and Terrorist Financing Prevention Act apply.
10. How do you settle with legal entities?
We settle with legal entities on a contractual basis. The agreed amounts move between the parties’ bank accounts. All transactions are cash-free.
11. What does the widely used term GSR (Gold-Silver Ratio) mean?
GSR is an internationally used term describing the price ratio between gold and silver. For example, GSR = 60 means that 60 units of silver currently equal 1 unit of gold. Analysts and speculators watch this ratio closely — when it seems high, one can buy silver and wait for the ratio to fall, i.e. for silver to appreciate against gold. If the ratio in this example dropped to 30 and the silver bought at GSR 60 were then exchanged for gold, the investor would in theory have doubled the initial investment.
