What is Bullion

Hantec market Australia provides bullion margin trading in addition to Forex. Precisely, the term bullion we refer includes only Gold and Silver, but no other industrial metals.

Gold and Silver are often seen as commodity currency owing to the rare nature, high demand and high economic value, which are traditionally traded to hedge against inflation and economic uncertainties in capital markets. Bullion is an important barometer of market sentiment and commonly considered as safe haven to other risky assets. But please do not be fooled by the name “safe haven”, bullion is also traded in continuous markets with 24 hours access and the price may have high volatility that is no less than any currency pairs, which brings the traders huge benefit opportunities as well as risk exposure.

Some terminologies you need to be familiar with

Basic knowledge you should not skip

Quotes

Bullion is quoted in pair with USD which contains an abbreviation of bullion and USD The price is a unit measurement of weight which is OUNCE. The base currency for bullion prices are USD only.

Example:

XAUUSD 1560.52 represents Gold’s price is US$1560.52 per ounce

XAGUSD represents Silver’s US dollar price

Pip/Tick

The minimum rate fluctuation is called a point, a pip or a tick.

For Gold prices are quoted with 2 decimal points, the last one is actually fractional pip, so the minimum rate fluctuation is US$ 0.01

For Silver prices are quoted with 2 decimal points, but there is NO fractional pip involved, so the minimum rate fluctuation is US$ 0.001

Bullion Rates

The bullion rates contain bid ask prices and bid/ask spread same as Forex, although the spread range may be different.

Lot: The contract size of bullion is different in contrast to Forex.

1 lot of Gold is 100 ounce

1 lot of Silver is 2500 ounce

The contract size directly affect you profit and loss per pip fluctuation.

P&L per pip fluctuation of Gold is US$10/pip

P&L per pip fluctuation of Silver is US$25/pip

Let’s put all these together

Hope this provide an integrated picture of trading, firstly we assume Bullion Market is bullish

You Long/Buy 1 lot of XAUUSD/XAGUSD

You Short/Sell 1 lot of XAUUSD/XAGUS