Which Gold Bar Size to Buy: Premium Against Flexibility
Bigger bars cost less per gram. Smaller bars let you sell part of what you own. That is the whole decision.
The metal inside a 1 gram bar and a 1 kilogram bar is worth exactly the same per gram. The manufacturing, packaging, handling and distribution are charged per bar. So the premium per gram falls as bars get larger, and the choice is really about how divisible you want your holding to be.
Key takeaways
- Premium per gram falls as bar size rises.
- A large bar can only be sold whole.
- Several smaller bars cost more up front and can be sold in parts.
- One troy ounce, 31.1035 grams, is the most widely traded retail size.
We do not sell bullion
Vanhess is a jewellery shop in Coquitlam, British Columbia. We sell solid gold jewellery. We do not sell, buy or broker bars, coins, ingots or wafers, and we are not a bullion dealer or a financial advisor. This page explains how bullion works so you can compare it fairly with jewellery. It is not a recommendation to buy anything.
The divisibility problem
Imagine you hold one kilogram bar and you need a fraction of its value. You cannot cut it. You sell the whole thing, which means realising the entire position and paying whatever spread applies on all of it, whether or not you wanted to sell that much.
Now imagine the same value held as smaller bars. You paid more per gram to buy them, but you can sell exactly as much as you need. For most people that flexibility is worth the extra premium, which is why the one ounce bar is so dominant in retail.
| If you want | Consider | Because |
|---|---|---|
| The lowest cost per gram | The largest bar you can afford | Per-bar costs are spread over more metal |
| The ability to sell in parts | Several one ounce bars | You can realise part of the holding at a time |
| The easiest resale | One ounce bars or coins | The most widely traded and instantly recognised sizes |
| A gift or a first purchase | Small bars, 5 g to 20 g | Low entry cost, though the premium per gram is high |
Worth knowing
A useful way to think about it: you are buying an option to sell in small pieces, and the extra premium on smaller bars is the price of that option. Whether it is worth paying depends on how likely you are to use it.
Frequently Asked Questions
What is the best size gold bar to buy?
For most retail buyers, one troy ounce. It is the most widely traded size, easy to price, easy to sell, and it lets you hold a position you can sell in parts. Larger bars are cheaper per gram but can only be sold whole.
Why do small gold bars cost more per gram?
Because refining, stamping, packaging, insuring and distributing are charged per bar rather than per gram. Producing ten 10 gram bars involves ten times the handling of one 100 gram bar, and that cost is spread over the same amount of metal.
How many grams is a troy ounce of gold?
One troy ounce is 31.1035 grams. This is different from a standard ounce, which is about 28.35 grams, and mixing the two up is a common and expensive mistake.