The bid-ask spread is the difference between the price a dealer sells a coin or bar to you (ask) and the price the dealer pays to buy it back (bid). It is the cost of a round trip, before any change in the gold price.
Bid, ask and the round trip
Canadian dealers publish two prices for most products. The ask (or sell price) is what you pay. The bid (or buy-back price) is what they pay you. The ask usually sits above the spot price by the premium; the bid sits near spot or slightly below it.
Fixed-number example with spot at 4,000 CAD per ounce: a dealer sells a 1 oz Gold Maple Leaf at 4,200 CAD and buys it back at 3,960 CAD. The spread is 240 CAD, or about 6% of the purchase price. If you bought and sold on the same day, you would lose that 240 CAD. Gold has to rise by about 6% in CAD before you break even.
| Product | Typical spread |
|---|---|
| 1 kg gold bar from a known refiner | Narrowest |
| 1 oz Maple Leaf, Britannia, Krugerrand | Narrow to moderate |
| Fractional gold coins and 1 g bars | Wider |
| Silver coins | Wide in percentage terms |
| Proof and collector coins | Widest, often far from metal value |
What widens the spread in Canada
- Unknown or damaged products: dealers may test or discount a bar without a recognized brand, or a coin with scratches.
- Taxable items: GST or HST paid on a 22 karat coin is part of your cost, while buy-back offers are based on the metal. See GST/HST on gold.
- Collector premiums: bullion dealers often buy proof and coloured coins back closer to metal value than to the issue price. See numismatic coins.
- Cash deals: when a dealer receives 10,000 CAD or more in cash, FINTRAC rules require it to verify your identity and report the transaction.
How to keep the spread small
- Buy recognized 99.99% products such as the Gold Maple Leaf or bars from LBMA-listed refiners.
- Keep original packaging and invoices; they speed up resale and support your capital gains records.
- Get buy-back quotes from more than one dealer before selling.
- Compare entry prices with delivery included in the cheapest gold coins ranking, since a lower entry price shrinks the spread you need to recover.
To value what you hold before asking for quotes, multiply its fine weight by the live gold price in CAD. A buy-back offer far below that figure is a signal to shop around.
Related terms
Premium Over Spot Spot Price Numismatic Coins GST/HST on Gold and Silver in Canada
FAQ
How much do you lose when selling gold back to a dealer?
You lose the bid-ask spread, the gap between what you paid and the dealer's buy-back price, which is smallest on large bars and well-known 1 oz coins.
Do dealers buy back at spot price?
Buy-back prices are usually close to or slightly below spot for recognized bullion, and lower for unbranded or damaged items.
Do I need ID to buy gold with cash in Canada?
For large amounts, yes: under FINTRAC rules a dealer must verify your identity when it receives 10,000 CAD or more in cash, including smaller payments that add up to that within 24 hours.