A spot gold price means current selling price or it could be said that price based on the price of “futures” contracts. Futures contracts are traded on future exchanges operating in a number of countries.
These futures contracts are standardized contracts when it comes to lot size, delivery period between the seller and buyer. Seller means who deliver the commodity and buyer means who receives the commodity for a price fixed in future. Futures Exchanges facilitate single point for commercial trade of all major commodities of country. The commodities may include energy sector like crude oil, natural gas. It could 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.
Dependant on market futures contracts is available for each month of the year. This means a contract for delivery of June is available xauusd through out of year. Basic behind to determine future market is to permit commercial producers and consumers to determine some guaranteed prices and also guaranteed method of getting the commodity which will be the topic 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 wish to minimize their risk against the cost change. Other participants of market are speculator who wants to take risk means the danger which a hedger wants to avoid. By the usage of future contract spot price risk could be minimized. Also by the employment forward contract spot gold price could be fixed to minimize the danger of price fluctuation of gold in future.
Spot gold price could be determined on commodity exchange market. All of the futures contracts are traded on the commodity exchange. You can find the spot gold price from the commodity exchange like COMEX situated 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 set has been specified in the NYMEX rule book.
These markets are fully computerized and the information they supply is in real-time. Second by second details about gold spot price of the futures contract of the active month as it is trading on the exchange is easily available. On the exchange probably the most active nearby month is also referred to as the spot month. If you prefer more concerning the Spot gold price it might be based on the active month calculation. And the closing gold spot price for your day hails from that days trading of the spot month futures contract. In New York spot gold price close is calculated as the average of the greatest and lowest prices of the trades over the past two minutes of closing period which will be 1:28-1:30 PM.
Folks have option to purchase 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