GOLD VS SILVER
The headline spot price is only one part of the cost of buying physical gold or silver. Dealer premiums, tax, delivery, storage and resale spreads can materially affect your outcome.
Gold and silver can have different cost profiles depending on product size, dealer, market conditions and liquidity. Neither metal is automatically cheaper to own in physical form.
Last reviewed: 12 August 2026
CORE EQUATIONS
These relationships apply to physical bullion. Exchange-traded products have their own charge structures.
Purchase cost
Spot value + dealer premium + delivery/storage (if applicable)
The premium is the amount above the underlying metal value charged when you buy.
Resale value
Spot value − buyback discount (spread)
Dealers typically buy back below the spot-based value they use when selling.
SPOT ≠ RETAIL
Spot prices reflect wholesale trading. Retail investors normally pay more to buy and receive less when selling back to a dealer.
PREMIUM DRIVERS
Coins, cast bars, minted bars and speciality formats each carry different production and liquidity profiles.
Smaller units often carry higher premiums per ounce or gram because fabrication costs are spread over less metal.
Products from well-known refiners and mints may be easier to resell, which can affect buy and sell spreads.
Supply tightness, shipping delays or surges in retail demand can temporarily widen premiums on either metal.
Larger orders may attract tighter premiums, depending on the dealer's pricing structure.
Investment-grade gold is VAT-exempt in the UK; silver generally attracts VAT on purchase. That tax difference affects total cost but is separate from the dealer premium.
COST PROFILE
These are tendencies, not rules. Always compare actual quotes for the specific product and quantity you plan to buy.
Silver is not always 'more expensive' in premium terms — and gold is not always cheaper. Compare like-for-like quotes.
UNIT SIZE
The weight and format you choose affects both the premium you pay and how easily you can sell.
Often higher premium per unit of metal. Can suit smaller budgets but total cost as a percentage of metal value may be higher.
Premiums per ounce may be lower, but require more capital and storage. Resale liquidity depends on the product and dealer network.
BUYBACK SPREAD
The gap between what you pay to buy and what a dealer will pay to buy back is often the largest single cost for short-holding periods.
ILLUSTRATIVE ONLY
Illustrative example only — not current prices
The figures below are invented for illustration. They show how premiums and spreads combine — not what you would pay today.
The metal price would need to rise by enough to cover the £90 gap before you break even on a same-day round trip — plus any storage or delivery costs not shown here. Actual figures vary by product, dealer and market conditions.
TOTAL COST
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