A spot gold price means current selling price or it could be stated that price on the basis of the price of “futures” contracts. Futures contracts are traded on future exchanges operating in several countries.
These futures contracts are standardized contracts in terms of lot size, delivery period between the seller and buyer. Seller means who deliver the commodity and buyer means who receives the commodity for a cost fixed in future. Futures Exchanges facilitate single point for commercial trade of major commodities of country. The commodities may include energy sector like crude oil, natural gas. It might also include cereals like wheat, corn, and soya beans, and metals like iron, copper, lead and zinc. Also future exchanges deal in gold silver and platinum plus other precious metals.
Depending upon market futures contracts is available for every month of the year. This means a contract for delivery of June is available xauusd through of year. Basic behind to ascertain future market is to allow commercial producers and consumers to ascertain some guaranteed prices and also guaranteed method of getting the commodity which will be the subject matter of contract.
Spot price of gold fluctuates dependant on demand and supply. Future contracts are used to hedge the change in gold price risk. Hedgers are those who want to minimize their risk against the cost change. Other participants of market are speculator who would like to take risk means the chance which a hedger desires to avoid. By the utilization of future contract spot price risk could be minimized. Also by the employment forward contract spot gold price could be fixed to minimize the chance of price fluctuation of gold in future.
Spot gold price could be determined on commodity exchange market. Most of the futures contracts are traded on the commodity exchange. You will find the location gold price from the commodity exchange like COMEX located in New York. The COMEX (Commodity Exchange) is leading commodity exchange in the United States for metals. The process of by which spot gold prices on the COMEX is determined has been specified in the NYMEX rule book.
These markets are fully computerized and the data they supply is in real-time. Second by second details about gold spot price of the futures contract of the active month since it is trading on the exchange is easily available. On the exchange the absolute most active nearby month is also called the location month. If you’d like more about the Spot gold price it could be produced from the active month calculation. And the closing gold spot price for the day is derived from that days trading of the location month futures contract. In New York spot gold price close is calculated as the typical of the greatest and lowest prices of the trades over the last two minutes of closing period which will be 1:28-1:30 PM.
Individuals have option to get gold from dealer or from exchange. But you can see the difference in spot gold price on the exchange actual prices today for small levels of gold coins