The premium over spot is the difference between what you pay for a coin or bar and the value of the metal inside it at the spot price, usually shown as a percentage. It covers minting, distribution and the dealer's margin.
How to calculate the premium
Premium (%) = (price paid / metal value at spot - 1) x 100. Metal value = fine weight in troy ounces x AUD spot price.
Fixed-number example: say AUD spot is 4,000 per ounce. A 1 oz Kangaroo priced at 4,200 AUD has a premium of (4,200 / 4,000 - 1) x 100 = 5%. A 1/10 oz Kangaroo priced at 460 AUD has a metal value of 400 AUD, so its premium is 15%. Same coin design, same purity, three times the premium per ounce. These are illustration numbers; the live premiums in our tables change every day.
What drives the premium in Australia
- Size: 1 kg bars carry the lowest premium per ounce, fractional coins the highest.
- Metal: silver premiums are higher in percentage terms because production and freight costs are large relative to the metal's value.
- Product: locally made Perth Mint coins are easy for Australian dealers to source; imported coins carry freight costs.
- GST: a 22 carat Krugerrand usually includes 10% GST in Australia, which shows up as a much higher apparent premium. See GST on gold.
- Demand: in a buying rush, premiums widen as stock runs short.
- Payment and delivery: card surcharges, insured shipping and minimum order sizes can add more than the quoted premium.
Compare the final delivered price
A low headline premium can hide a high shipping charge. Two dealers might list the same Kangaroo at 4,200 and 4,180 AUD, but if the second charges 40 AUD for insured delivery and the first ships free, the first is cheaper. That is why metalsradar ranks by the real final price including delivery, then shows the premium against spot.
| What to check | Why it matters |
|---|---|
| Price per fine ounce | Removes the effect of alloy and coin size |
| Delivery cost to your postcode | Insured freight to regional areas can be significant |
| GST included or not | Only matters for items below the purity or investment-form test |
| Buy-back price | Total cost of owning includes the bid-ask spread |
Start with the 1 oz Kangaroo gold coin price comparison, or scan all products in the cheapest gold coins in Australia and the cheapest silver coins. Premiums on collector releases are a different story; see numismatic coins.
Related terms
Spot Price Bid-Ask Spread Bullion GST on Gold and Silver in Australia
FAQ
What is a good premium over spot for gold in Australia?
Large bars and 1 oz bullion coins carry the lowest premiums, so compare current offers in our ranking rather than relying on a fixed percentage.
Why is the premium on silver higher than on gold?
Making, storing and shipping silver costs about the same per coin as gold, but the metal is worth far less, so the cost is a bigger share of the price.
Do I get the premium back when I sell?
Usually only partly, since dealers buy back near or below spot; the premium is mostly a cost of entry.