Alongside Silver and Oil, Gold is a very popular commodity to spread bet. Investors traditionally flock to and trade the precious metal in times of uncertainty. The amount of gold humans have ever mined from the ground would only fill about three and a half Olympic sized swimming pools, about half of this is used in jewelry, a fifth is used directly for investment, a fifth is held by governments to back their currencies and the rest in industry.
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1. Gold is so rare that the Earth’s crust contains just 1 gram of gold for every 250 tonnes of earth.
2. In 2013, India and China accounted for 54% of global demand for gold.
3. The deepest gold mine in the world, located in South Africa, plunges to 3.9km deep.
4. 2,500 tonnes of gold is produced in a year, with around 2,000 tonnes used for jewellery and industry, and 500 tonnes used retail investment purposes.
5. Scientists believe that most of the gold on Earth was brought here by meteorites 200m years after the planet was formed.
6. 1 ounce of gold can be stretched into a thread 50 miles long.
7. Gold is so malleable that a single gram can be turned into a 1 metre squared sheet. That means it would only take 22kgs to completely cover Lord’s Cricket Ground, or 1,420kgs to blanket the entirety of Hyde Park.
8. There is an estimated 10 billion tonnes of gold in the world’s oceans.
9. Gold is so rare that more steel is poured in an hour than all the gold that has ever been produced.
10. Market analysts use the Dow/Gold ratio as an indicator of how bad a recession is. The ratio represents how much one share of the Dow is worth in gold. After the 2008 crash, the Dow/Gold ratio approached similar levels as in the 1930s and 1980s.
11. The Federal Reserve Bank of New York holds 25% of the world’s gold reserve (540,000 gold bars), worth over $147bn. This is more gold than is contained at Fort Knox, though the majority is the property of foreign governments.
12. 70 million tonnes of earth are processed each year to extract South Africa’s annual production of 500 tonnes of gold.
13. South Africa produces two thirds of the world’s gold.
14. The Aztecs called gold, “teocuitati”, which was translated by Europeans as meaning “excrement of the gods”.
15. Gold nuggets are extremely rare and compose just 2% of all gold ever mined.
16. An ounce of gold can be made into a wire just five microns thick which would reach a distance of 80km. Stretched out, the wire would run the total length of the Piccadilly Line with 9km of gold wire left over.
17. If all the gold ever mined was stretched into a wire, it would be 280 trillion miles long; 100 times the distance from Earth to Pluto.
18. The largest gold nugget ever recorded, the ‘Welcome Stranger’, was discovered in Victoria, Australia in 1869. The nugget weighed 78kg, producing 71kg of pure gold after processing.
19. The world’s supply of gold increases by just 1% to 2% every year.
3500 BC: The Egyptians used gold for statues and money. Famously, Tutankhamen’s coffin was made from 100kgs of gold.
564 BC: During the Zhou dynasty the Chinese produced gold coins called the Ying Yuan.
560 BC: The Lydians start using gold coins circa 560BC. Subsequently, gold currency became widely used in the Middle East and the Mediterranean.
120 AD: At its peak, gold coins such as the Aureus were circulated throughout the Roman Empire. The later debasement of the currency (mixing gold with less valuable metals to produce coins) was one of the contributing factors to the fall of the Empire.
1284: Venice introduces the gold Ducat, which would become one of the most trusted and popular coins in the world for the next 500 years.
1500s: Conquistadors plundered Incan and Aztec gold from South America, providing unprecedented wealth for the Spanish monarchy and easy pickings for Sir Francis Drake.
1800s: From the mid-1800s to the outbreak of war in 1914, the world used the Gold Standard system. To many observers, the Gold Standard can be credited for the stability and increased prosperity of this period.
1946: The Bretton Woods agreement creates a new gold standard, with the price of gold fixed at $35 an ounce and the USD becoming backed by gold.
1971: Under Richard Nixon, the United States unilaterally abandons the gold standard, reverting to a system of floating exchange rates.
1974: The ban on US citizens buying and selling gold is lifted, allowing Americans to trade gold once more.
1975 Gold prices had been allowed to float freely on the private market, but were still fixed at the Gold Standard level of $35 per troy ounce for settling international debts. In 1975, this two-tier system was completely abandoned, marking the definitive end of the Bretton Woods system.
2000 onwards: Financial crises and increased printing of money by central banks has seen gold’s popularity increase dramatically.
Trading gold with Core Spreads mirrors the fluctuations of the underlying gold market without having to own the asset. Spread betting gold allows you to profit, or incur losses, with a fixed spread of 4 points.
Placing a spread bet on gold is as straightforward as our charges. For example, you place a £10 per 0.1 point buy trade at a bid-offer spread of 1235.0 – 1235.4 and the markets rise by 10 points to a bid-offer spread of 1236.0 – 1236.4. At this point you decide to sell, closing your trade at 1236.0 points, giving you a profit of £60 (1235.4 – 1236.0 = 6 and 6 x £10).
Conversely, the markets fall 10 points and you decide to close your trade at a bid-offer spread of 1225.0 – 1225.4, incurring a loss of £104 (1235.4 – 1225.0 = 10.4 and 10.4 x £10).
You can spread bet gold and thousands of other instruments by signing up for an account here.