In simple terms, the gold spot price acts as the primary method for determining the current value of one troy ounce of physical gold bullion. This dynamic price discovery mechanism is essential in establishing the market price for gold.
The spot price is what is commonly called “the gold price”. This price varies from marketplace to marketplace and depends on the currency type one is using when referencing the gold price. For example, in the United States, the gold price is referenced by-the-ounce, in US dollars. The most commonly referenced spot price is “the gold futures market price”, and in particular, the COMEX, which is a commodities contracts market for people buying and selling gold in quantity in the United States.
The spot price of gold is not the complete price of gold. A number of factors go into how much it actually costs to get an ounce of gold in-hand, in addition to the spot price. For example, a refiner or private mint may buy gold in 100-ounce bars on the COMEX futures market in order to make generic, in-house gold bars & rounds, and those factors must be accounted for in determining the gold price set by that individual refiner or mint. The bottom line is the price of gold, as shown in the price ticker that scrolls along an arbitrary screen, is not the same price one actually pays to buy gold from a seller.