The gold market is notoriously opaque and private, which is not surprising for an asset that is often purchased for insurance purposes. While this privacy is comforting on one level, it presents a problem for the sophisticated investor alert to the subtle word games that marketers and lawyers can play. There are no public sources of information that can be referenced to help assess the risks involved in the transaction you are contemplating.
Engaging a law firm is essential, but gold is a niche industry and it is rare to find advisors with precious metals experience. Good research can achieve a lot, but then they are learning on your dime; without an understanding of the practical mechanics of the market, you don’t know what you don’t know.
For example, “allocated” has been used very loosely by bullion dealers in recent times. While your gold may be off-balance sheet, the combination of a bankruptcy, smart lawyers on the creditors’ side, and an apparently trivial detail in operational segregation by the bullion dealer and your allocated metal could be dragged into the bankruptcy estate to satisfy the creditors. Often one simple question of the dealer can reveal the risk.
Monetary Metals® can fill the knowledge gap with impartial advice. We do not buy or sell bullion or provide storage services, yet have decades of experience in these areas. We work on a fee-for-service basis and do not accept referral commissions, being equally willing to make an introduction or pass on details for you to contact independently.
Whether you are looking for us to work with your trusted advisors to identify legal risks, or provide tailored advice on how to structure your precious metal investments, you can rely on us for trustworthy guidance. A few thousand dollars is a worthwhile investment when you have much more at stake.