免责声明: 这些是我们满意的客户对于抵押计划如何帮助他们实现目标的分享，但这绝不是为次作代言或投资建议，可能不适用于所有情况或您的个人情况。 此处共享的信息具有一般性质，不应被视为任何特定问题的专业和/或法律建议。
Nevertheless, we all have things we want to pursue in our lives, yet our cash flow on hand is limited, or we might not fulfil a certain requirement to have a credit card. So how can we achieve what we want in this case? Let’s share how we provided a solution for our clients, Amanda and Ben (Fictitious names created for privacy).
Amanda just graduated and started to work a month ago; she is not eligible to apply for a credit card yet. Unfortunately her phone is faulty and she’s looking to replace it with an iPhone 12. With the above mentioned limitations, GSC Collateral Loan might be a program she can consider for the short term.
She has some gold jewellery that she received from her parents and relatives during her 21st birthday celebration, left idle in her drawer. She doesn’t like to wear them but still view them as meaningful and valuable, hence she still intends to keep it.
And now for her to afford an iPhone 12 without asking help from her parents, she decides to pledge the gold jewellery, top up with some of her savings to purchase the iPhone 12 and then repay the loan and interest to redeem the gold jewellery within the loan tenure, which is 6 months after she starts on her new job.
On the other hand, Ben has been working for a few years and just got married. To increase his wealth and save up for future expenses i.e. having a baby and pay for a new house, he’s looking to invest in the recent bullish asset, cryptocurrencies. He has done his research and believe that it’s still a good time to buy into cryptocurrencies now as it still has potential for more growth. To raise enough funds to invest in crypto, he pledged the gold jewellery they received during their wedding since it’s not suitable for daily wear.
The reason for not selling the jewellery was, he believes keeping Gold as an asset is a good diversification in his portfolio and Gold looks like it has further upside. By pledging his Gold jewellery, he gets to unlock the cash flow from an idle asset to invest in other assets classes and yet retain the ownership of Gold. This way he can kill two birds with one stone. He pays the loan interest from the profit he makes in trading cryptocurrencies and from time to time, he makes some repayment to reduce the loan amount and hence the interest that he needs to pay.
Want to know how Amanda and Ben do it? Feel free to browse our website and articles on sharing about our GSC Collateral Loan program. Don’t be shy to contact us if you have further queries and our friendly sales team will be more than happy to assist.
Disclaimer: These are sharing from our happy clients on how the collateral program assisted them to achieve their goals, but this is by no means an endorsement or investment advice and may not apply to every situation or to your own personal circumstances. Information shared here are of general nature and should not be regarded as a substitute for seeking professional and/or legal advice on any specific issues.
Last week, as part of our Storage month highlights, we looked at one single important reason on why you should own a Storage Account.
Today, we shall look at GoldSilver Central Storage program fees and understand what you are paying for as a Storage Customer.
GoldSilver Central’s Bullion Storage Program has been around since 2012 and has continued to serve our clients well. Located at Changi Le Freeport, a tax-free zone in Singapore, it is now considered amongst the safest area in Singapore.
Below is our Storage Fees Structure:
A question you might have is, what exactly are you paying for?
- Security and Insurance
We know we’ve been saying that your holdings are stored in a secured facility. How secure is it exactly then? For starters, the physical compound is surrounded by concrete walls between steel plates and there are CCTV systems in place. The building facility is maintained by a central Freeport Authority and each vault operator within Changi Le Freeport has their own security system according to their design specs.
What this means is that in order to access your holdings, we would have to go past at least two levels of independent checks. GoldSilver Central also ensure that we work together with LBMA vault operators which adds another level of checks to our clients’ holdings. This also means that vault operators are able to fully insure your holdings due to the high level of security and stringent procedures.
This is the key difference compared to storing your holdings at a location such as your home safe.
No doubt, your home safe would be more easily accessible compared to GSC’s vault storage. However, we do need to consider what happens after you physically access your holdings? (You would still have to find a bullion dealer to sell it to you.)
Which brings us to our next point
Administrative and Convenience costs
GoldSilver Central Storage Clients have the option of being able to sell their holdings anytime they wish to. This can be achieved via our “DIY mobile platform”, GSC Live!. Storage clients have the option of being able to set sell limits or sell outright via GSC Live! and the fund proceeds can be transferred to your bank account after.
Good news is, there’s no need for you to fly into Singapore to transact or to reach an actual human staff at GSC to sell your holdings (You can sell it whenever you wish to.)
Also, if you are already storing your holdings at an external deposit box or a secured warehouse, we would like to propose you consider GSC Storage program as well. Ultimately, wherever you are storing your holdings, I would personally look at it as a potential investment in a partner (if you store it at home, then your partner is yourself!) that could assist you in your precious metals investment. And GoldSilver Central can help you to decrease your risks.
Perhaps a good question to guide you in your considerations would be:
Will the benefits of having a GSC Storage account offset the low costs?
At the end of the day, a wise man once said:
“Price is what you pay, value is what you get.”
If after reading this article, if you wish to speak with GoldSilver Central to see exactly how we fit into your financial planning, let us know. We are honored to be part of your precious metals journey.
GoldSilver Central’s Bullion Storage Program created since 2012 has continued to serve our clients very well. Located at Changi Le Freeport, a tax-free zone in Singapore, it is now considered amongst the safest area in Singapore.
Today, as part of our Storage month highlights, we shall highlight one important reason to have a Storage Account
Better manage your risks.
We know that proper management of risks is important in building your wealth portfolio.
Major unforeseen events like Covid-19 should give us a renewed respect for unpredictable catastrophic events and its possible impacts on our portfolio. For instance, a client who lives in Malaysia declines to store his precious metals in Singapore and instead stores it at his home safe, as he can cross over to Singapore very quickly if he ever needs to sell his holdings. Covid-19 hits and suddenly countries are on lockdown and borders are closed. Good luck trying to travel across to sell your precious metals. That is not going to happen.
Also consider a situation where a black swan event occurs and silver prices are skyrocketing, the market is going into a frenzy, and you are keen to bring your silver holdings into a bullion dealer for a valuation and sellback. Chances are the majority of the market will be looking to do the same thing and you suddenly find yourself jostling amongst others and trying to sell your silver at the highest possible price before the prices drop. Again, throw in Covid-19 into the above situation when many countries went into lockdown, and you could not even travel outside your home for non-essential purposes. (I may be wrong, but I highly doubt “I have to sell my silver before prices drop again” will pass as an essential purpose in the eyes of the law.)
During these times, you can clearly see the benefits that having your precious metals holdings stored with a trustworthy and reputable dealer like GoldSilver Central. For your reference, no storage customers of GoldSilver Central faced any issues in their transactions with us even as they are unable to travel due to Covid19 restrictions.
GoldSilver Central has built up an intensive network of trusted and international partners over the years. By building up such an extensive network, we can ensure constant liquidity, regardless of market conditions. Also, we are better positioned to negotiate with refineries and to buy / sell excess in the market compared to an individual investor looking for a single sell transaction. May I take this chance to also add that we have our GSC Live! Platform where clients can lock in their buy/sell prices on their physical precious metals on their own mobiles, instead of having to try calling in to GSC together with the hordes of people who probably have the same intention to try and sell their precious metals then.
That’s it for today, we’ve explored one of the reasons of having a Storage Account with GoldSilver Central. In our next article special, we’ll dive deeper into the fees of the Storage Account. Till then, stay safe!
(If I may just add a personal plug, for investors interested to understand more about “black swan events”, read <<The Black Swan by Nassim Taleb>>)
“Why are your Spot prices on your website different from other bullion dealers or platforms?”. This is a question that we often hear from our retail clients. So, today we will be answering this question briefly.
- The prices are dependent on the frequency of price updates to the website. Precious Metals’ prices fluctuate every millisecond. However, websites are not able to handle the frequent update of prices and setting it to update every second will crash the site unless a lot of resources is set up just to support this and this in turn will be very costly. Thus, the refresh rates for websites are usually less frequent and it might only be updated only after a few minutes. Prices on GSC website are updated every 2 minutes.
- All bullion dealers or platforms have different liquidity providers or price source. Different liquidity providers will provide different prices with minimal spread. Thus, the Spot prices would not be exactly the same for different dealers. Moreover, spot prices in different currencies (depending on home currencies of dealers) for example in our case SGD, will also need to be converted from USD to SGD as Gold is traded in USD predominantly. This would also incur some spread and depending on the forex liquidity provider that the dealer uses for currency exchange, in most cases banks, there will be a spread as the bank will have to make their margins. This will widen the spot prices quoted in the local currency, in our case SGD.
Spot prices can be affected or determined by various factors such as market demands, sentiments, number of buyers and sellers and more. Even location of the dealer and thus the cost of bullion can differ for the same bar or coin in different countries. We will further discuss these in future articles. If you have any questions, please feel free to contact us to understand more! In the meantime, stay safe!
Did you know, other than purchasing Precious Metals outright through our e-commerce site or over-the-counter, you can also accumulate precious metals gradually. Take your time to save and accumulate the asset and then redeem it whenever you decide.
Accumulating (Precious Metals) gradually allows you to average out your cost and spread out your funds just like the current trending way of purchasing, BNPL (Buy Now Pay Later). Just that in this case you can only take delivery after you saved the full weight of the physical precious metal you want. You can have a peace of mind even if you do not have the time to monitor prices in order to decide when to buy in. GSC Savings Accumulation Program (GSAP) is designed to automatically purchase for you daily, based on your stipulated amount you would like to save into precious metals monthly.
At any time during or after the accumulation, you may redeem the precious metals by selecting your desired physical products – bars, coins and/or jewellery. Based on your accumulated weight at that point of time, you can browse through GSC and Kim Gold product range to select what you would like to redeem. After you have decided, GSC will share more on the premium/Kim Gold Fee to top up.
Jewellery with different purity will be calculated accordingly when redeeming them. If you have queries on this, please do not hesitate to contact our team to understand more.
Don’t miss this good “lobang” as we Singaporeans like to say it in Singlish. This means don’t miss out on this good opportunity on our very own Precious Metals BNPL Program aka GSAP!
“Spot prices dropped by over 4.00% in a span of 60 minutes before rebounding back 2-3 hours later.”
The above situation sounds like how BTC typically behaves with its extreme volatility. (For those of us who doesn’t track BTC, BTC’s price fell by over 55.00% in a span of 2 months recently, with the biggest drop being 49.00% within 2 weeks.)
That’s akin to saying your million-dollar HDB flat is now worth only 500k on the market. Ouch.
But guess what, the above situation refers to our safe haven asset known as Gold and it happened just this week, 9th August 2021 (Incidentally when Singapore celebrated its National Day holiday.)
The massive dip occurred just after 0700hrs local Singapore time, a time where most people were just starting their day. The dip lasted for an hour before rebounding back upwards 2 hours later towards levels of US$1740.
The big money question is “Why?” And we at GoldSilver Central, have laid out several possible scenarios as to what might have happened.
Coincidentally, on the 9th August, two major Asian markets were closed. Singapore was celebrating its National day and Japan was observing its Mountain Day holiday in lieu. With both markets closed, the depth of the commodities market was shallow, and liquidity obviously was not as readily available. There were probably fewer traders physically on desk as well.
A large legitimate sell order was placed. As traders were mostly off desk, the order could have been placed out into the market instead of a manual cover by an actual trader. And due to the lack of liquidity in the market, prices dipped accordingly to fill up the glut caused by the large sell order.
Of course, there are several follow-up questions in this scenario. Would prices really dip that much? Would this big dip happen again? What can I do to prevent margin calls for my account?
The truth is, we will never know with certainty. Unless we are the actual parties involved (The dealer who got the sell order or the actual customer with the sell order), we can only “guess” based on the available data that we have on hand. And the one thing is clear, Gold dipped by over 4.00% in an hour to hit a low of US$1684.72 between 0700 – 0800 hr local Singapore time on 9th August 2021.
Would it happen again?
We don’t know. From our experience, big orders are usually spread out across several days due to its sheer size to avoid large slippages and market movements. Hence, they are usually done Over-The-Counter, directly between market participants. This prevents unnecessary shocks to the markets. From the looks of the markets right now, it seems that we are out of the woods with gold prices hovering around the US$1750.00/oz levels. But can we say with certainty that prices will not cross below US$1700 in a shock dip like what we just experienced? No, we cannot be certain.
High-frequency trading probably exacerbated the drop triggered by stop losses.
Due to the prevalence of high frequency trading these days, large volumes of trades can be pushed through in a shorter span of time now. There is debate as to whether HFT ultimately contributes to increased market volatility and sharper spikes and crashes. However, we will leave that to another day for discussion.
What we wish to bring up here is that the quick pace at which the price dropped that morning probably didn’t even leave time for most traders to adjust their stop losses accordingly. Each lower price level would likely have triggered further stop losses, thus resulting in a negative spiral downwards until more and more traders caught wind of the situation and managed their positions accordingly.
Well, what should you do now?
Ever heard of the saying “Don’t try to catch a falling knife?” The same principle applies here, you weren’t in the right position before the event occurred. So don’t try to chase after something that is just simply not meant to be.
Reacting to an unexpected situation is never a good thing and we won’t know for certain what is going to happen next. If anything, stick to your gameplan. There are always opportunities in the markets.
If your initial position was a buy position, then see this as a good chance for accumulation. And do it wisely. GoldSilver Central offers you the tools to do so. We have:
Dollar Cost Averaging Strategy is the crux here, and when you onboard the GSAP, accumulating daily is stress-free. Think of it as automated disciplined savings for your purse strings. It allows you to break up your purchase into daily smaller bite sizes, spreading out the price risk that you must bear. More discipline in your life isn’t such a bad thing.
A mobile friendly application that is a powerful tool for investors. You now have the capability to view and transact based on live streaming market prices. Yes, that is right, you can buy / sell anytime and anywhere that you find convenient. So if prices were to crash once again, you would be able to take action immediately. And the best part? It’s 100% physically deliverable. Yes, let me repeat, 100% physically deliverable. You can exchange the pool allocated gold in your GSC Live! Account for physical bars & coins at our retail shop.
If you wish to learn how GoldSilver Central can add value to your portfolio, let us know and we’ll give you a call at your convenience.
Many wonder what other benefits the GSC Collateral Loan Program will have other than the usual that is already known, e.g. short term cash flow. Here we have a perfect case study about how you can keep your physical precious metals but yet still unlock liquidity from it for other available opportunities or need.
Amy invested in Silver after she had done her own research and believe that silver price will rise in the long run. She bought 1000 oz worth of 100 oz Silver bars that cost $37,500 last week but she believes that equities now are a good time to get into.
This is where the GSC Collateral Loan program can assist and help Amy to have both in her portfolio. Assuming the Silver spot bid price is at $34/oz and the loan-to-value of silver is at 75%, let’s look at a simple scenario on how this program works.
Amy starts by buying 1 pc of the 100 oz silver bar and put it into the collateral loan program. She will get $34/oz x 100 oz x 75% = $2550 from collateralizing the bar. If she collateralises 10 of her 100 oz Silver bars, she will be able to get $25,500 from them. She can then use the short term liquidity from her bars for other investment opportunities such as the equities she is looking at or even buy into other precious metals such as Gold if she believes that we are in a commodities super cycle. This is akin to what many are more familiar with, mortgaging their homes for liquidity for investment opportunities or to tide through tough times, you can do the same for Precious Metals and jewellery too!
Feel free to contact us if you are interested!
It has been a busy week, you didn’t have much time to look at your Precious Metals (PM) investments during the week. Now that it is coming to the weekend, you decide to purchase some LBMA Good Delivery gold bars as prices having been dipping throughout the week.
BOOM. Wrong move there. You might have been better off waiting for Monday. To understand why, we first must understand the price components of a gold bar and why weekday prices are different from weekend prices.
If you are unfamiliar with the below equation, get familiar with it first!
Price = Physical Premiums + Spot price
(For more information, refer to “Cheaper a bit can a not?” Why your gold bar should NOT be cheaper.“ Article)
“Wise and successful businesses properly manage risks.”
For GoldSilver Central, we adopt a Hedging-based model approach where we ensure that we are not exposed to price fluctuations on our clients’ orders. This approach allows us to serve our clients without any prejudice on prices and ensures that we are not adversely affected by massive rise/drop in prices. To put things in perspective, a $200 increase in gold price will not equate a $200 increase in profits for selling a gold bar, as we do not take any positions on the gold spot price.
Under normal market conditions, where there is deep liquidity available and market participants aren’t afraid to quote prices for buying/selling, the difference between the selling price and buyback price (Also known as the buy-sell spread) is narrow. This is a natural function of efficient markets, where conditions for performing transactions are very fluid and has less or no friction. This is what usually transpires on a weekday where many market participants are available, and dealers are active also.
However, on a weekend, this is not the case. Market participants are inactive and do not quote prices. Hence a bullion dealer who deals on the weekends will instead, take the trade onto their own books. This creates exposure and a higher risk for the business itself, come Monday when markets are once again open. To deal with this increased risk, the buy-sell spread is widened to account for any possible fluctuations between the current quotes and the Monday market prices. This widening could be reflected in either the physical premiums or the spot prices itself.
A fun fact: Never try to compare prices of brokerages on a weekend. The adjustment of the buy-sell spread differs for each brokerage and you will end up with an inaccurate comparison.
How is the buy-sell spread determined on the weekends?
Reputable bullion dealers will have their own price risk assessment and structure. They consider several factors, such as the current market volatility, and price accordingly. Hence, you may observe that the buy-sell spread for the weekends may differ for different products.
This is also why some bullion dealers do not take in large orders on the weekend, as this increases their risks to an unacceptable level.
This sounds so unfair! Why should there be a wider buy-sell spread?
It is not a question of “fair / unfair”. Rather a more appropriate question to ask yourself should be “am I willing to deal at the current quoted rates?” Reputable bullion dealers widen the buy-sell spread to account for the increase in risks that they undertake. If they do not, they expose themselves to unacceptable risks and may even go out of business if the risk is not managed properly. However, if a dealer widens the buy-sell spread too widely compared to others, savvy investors know not to take it up and the dealer effectively prices himself out of the market. GSC offers services such as GSC Live! and price alerts/limits that assist our clients to monitor their desired price levels.
So why transact on the weekends?
It depends on your objectives!
If you are a regular investor and are now in the accumulation phase of your investments, you may wish to avoid placing weekend trades to avoid any major fluctuations in your accumulation. Slow and steady as some call it.
However, if you are a gun-slinging sniper looking for short-term opportunities from minor movements in price, and you foresee that prices are poised for a big movement come Monday, then yes transact on the weekends and lock in those prices. There are also investors who see that the current weekend prices meet their desired levels and are happy to sell at these levels. There is nothing wrong in that too.
Ultimately, GSC’s role is provide liquidity to our customers at fair and transparent rates. We also have value added services such as GSC Live! that make it easier for clients to achieve their objectives. The choice to transact or not, has and always will be the client’s to decide.
Till the next time, have a good weekend.