Bullion Loan Agreement

As a rule, futures contracts are the most suitable for the most experienced investors. The lender keeps the hard asset safe, knowing that in the event of default, metals can be sold quickly on the open market, given that the precious metal is a highly liquid asset. With an LTV of 50 to 70%, any price reductions are taken into account and the lender can therefore be sure to recover all the funds with minimal effort. The price of gold bullage is influenced by the demand of companies that use gold to make jewelry and other products. The price is also influenced by the perception of the whole economy. For example, gold is becoming increasingly popular as an investment in times of economic instability. For the borrower, total ownership is preserved. Although the precious metal is under the control of the lender, the borrower will still enjoy all the benefits of rising the price of the underlying gold during the term of the loan. Precious metals can sometimes be considered legal tender, most often held in reserves by central banks or used by institutional investors to hedge against inflationary effects on their portfolios. About 20% of the gold mined is held by central banks around the world. This gold is kept in the form of bars in the reserves used by the Bank to repay the international debt or revive the economy through credit to gold.. .

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