Gold: Trading
The 400-ounce bar behind London's bullion market
The 400-ounce bar behind London's bullion market What this tab covers How and where it is bought and sold: who buys and sells, exchanges and benchmarks, contract types, the big trading houses and how prices are discovered.The core market is London's over-the-counter bullion market, overseen by the LBMA. The deliverable unit is a 400-ounce bar of at least 99.5% purity held in approved vaults, usually traded unallocated (Geman, pdf p. 184). A daily auction sets the benchmark. COMEX futures in New York, the Shanghai Gold Exchange and India's MCX add price discovery. Gold also has an interest-rate market: central banks lease gold to bullion banks, which lend it to miners or sell it forward (Geman, pdf pp. 199-200). Heavy producer forward selling in the 1990s added to the price slump (Humphreys, pdf p. 40).
Where it is bought (buyers)
- Jewellers and households in India, China, the Gulf and Turkey buy kilobars and 100 g bars through banks and nominated agencies
- Central banks buy 400-oz London Good Delivery bars, often from bullion banks or directly from domestic miners
- ETFs and investors buy through LBMA bullion banks, COMEX futures and the Shanghai Gold Exchange
- India's qualified jewellers can import via IIBX in GIFT City
Where it is sold (sellers)
- Miners sell dore to refiners (Switzerland, Dubai, South Africa's Rand Refinery, India's MMTC-PAMP) under refining agreements
- Refiners sell bars to bullion banks and wholesalers in London, Zurich, Dubai, Hong Kong and Singapore
- Households sell old jewellery back to jewellers, about 28% of 2025 supply worldwide
Exchanges and benchmarks
| Venue | Contract | Notes |
|---|---|---|
| LBMA (London OTC market) | Loco London spot and forwards in 400-oz Good Delivery bars, at least 99.5% fine | Largest market; LBMA Gold Price auction twice daily, run by ICE Benchmark Administration |
| COMEX (CME Group) | Gold futures GC, 100 troy oz; micro 10 oz | Main futures price-discovery venue |
| Shanghai Gold Exchange and SHFE | SGE Au99.99 spot (1 kg); SHFE gold futures 1 kg | China's physical market; Shanghai Gold Benchmark in yuan |
| MCX (India) | Gold 1 kg; Gold Mini 100 g; Gold Guinea 8 g; Gold Petal 1 g | Rupee price includes import duty; most Indian hedging and speculation |
| IIBX (GIFT City, India) | Gold 1 kg and 100 g bars (995 and 999 fineness), dollar-denominated spot | India's international bullion exchange, launched 2022; qualified jewellers import through it |
Contract types
- Spot loco London, unallocated or allocated
- Refining (tolling) agreements for dore
- Gold leases and swaps between central banks and bullion banks
- Futures and options (COMEX, MCX, SHFE)
- Sovereign gold bonds and ETFs in India
- Gold metal loans to jewellers in India
Top trading houses
- JPMorgan
- HSBC
- UBS
- ICBC Standard Bank
- Valcambi
- PAMP / MKS PAMP
- Argor-Heraeus
- Metalor
- MMTC-PAMP
How prices are discovered
- LBMA Gold Price (ICE Benchmark Administration) twice daily
- COMEX front-month futures
- Shanghai Gold Benchmark and the Shanghai premium
- IBJA rates and MCX futures for rupee prices
- Local premium or discount surveys (Reuters, WGC)