Careful. It looks like Provident is discounting garbage

Spot: 1225.77

1/10 oz Canadian Gold Maple Leaf | Random Year
$133.61
BUY BACK PRICE: $120.49
https://www.providentmetals.com/1-10-oz-canadian-gold-maple-leaf-dates-our-choice.html

Caution 1: The sell price is very good at less than $8 over spot, or about 8.5% over spot.
However, the buy back price is UNDER spot. This is unheard of! A tenth ounce Maple should be bought back OVER spot. However, Provident is buying these back at more than $5 under spot. 1.7% under.

That's a spread of over 10% cash lost in the transaction.

Meanwhile, 2018 tenth ounce Maples will be bought back at over spot. So, is there something wrong with these discounted 1/10 Ounce Gold Maples? Yes, yes, I think there is. Read on...

Caution 2: The description

"As these coins are sourced from the secondary market, the dates of this product will be grab bag style and will likely show signs of wear including contact marks, reed marks, copper spots, and/or abrasions, etc."


I would avoid this deal.

 

Log in or Sign up to hide this ad.

HMMMM......I do shy away from fractionals, but do understand that some folks can afford only those. Thanks Paul Revere.........

 

I don't know of a law that says that gold (or silver, or platinum) is required to be traded at spot. Dealers can sell and BUY at any price that they like. I have two dealers for bullion I frequent. One has very low selling prices, while the other has the highest buy prices. So, I would never sell to the one with the lowest selling prices, and I wouldn't buy from the one with the highest buying prices. Capiche?

 

Buying fractionals on discount is an excellent way to buy gold cheaply with low or zero margins. Typical buyback prices of tenth ounce Eagles and Maples is often several dollars over spot. So, when Provident has discounted them in the past at around $5 over spot, their buyback prices at the same time have been almost the same amount. In that scenario, you can often acquire gold at zero margin.

While I am a full ounce buyer typically, I have purchased fractional Eagles and Maples from Provident before, and the Maples have been BU sealed. It looks like those days are over and Provident is now using their discount page to unload garbage.

 

Provident, Apmex etc I assume have lower buyback prices than spot.
that is one thing I check from time to time and compare to spot and the premium they ask.

And the BIG thing .. you DON'T have to sell to provident, apmex, etc.

 

But that's the point, they don't buy back below spot. You can see their buy back prices on all their other fractionals. This is something I observe nearly monthly. And they are almost all OVER spot. The fact that the buy back on this special item is BELOW spot should tell us something about the very low quality of this particular item.

So my point is that these 1/10 oz Maples are likely in very poor condition, as their description notes, and thus the buy price on them at any dealer would be bad.

That's why I cautioned the community to avoid this, even though it superficially looks like a good deal.

What do you think?

 

One cannot say they didn’t warn the buyers of what they’re getting.

 

Canadian gold .. you have to have the $$ conversion to American Gold

 

Some will say .999 gold is .999 gold. If it is part of someone's financial plans ( not ours to judge), that works.

 

Quite right.........

 

No, no, you just have to remember to convert to metric troy ounces.

 

But gold is still gold. The coins are cheap because they aren’t perfect. I really see no issue with this. They gave fair warning . If someone wants to get gold cheap I see no issue with going this route.

 

Great way for budding jewelers to get some high-grade gold for a cheap price. I use them as blanks to strike medals over.