After this guide you can
- Distinguish physical metal, funds and derivatives
- Understand the roles of dollars, real yields and industrial demand
- Calculate loss from the number of ounces
Identify what you are buying first
Bullion, gold-fund units and CFDs or futures are different instruments. Bullion involves storage and authenticity; funds depend on their structure, costs and holdings; derivatives have margin and settlement terms. XAU/USD usually denotes gold priced in dollars, but the symbol alone proves neither physical ownership nor delivery terms.
Global precious metals are commonly quoted per troy ounce, approximately 31.1035 grams. Ounces per contract can vary. Before trading, record the quote unit, contract size, value of each price change and holding costs together.
Gold and silver do not always move together
Gold does not generate dividends or coupons; changing real yields can alter its opportunity cost. The dollar, investment demand, central-bank purchases and political risks also matter. These relationships are conditional: rising dollars or yields do not guarantee falling gold, and several drivers can pull in opposite directions simultaneously.
Silver has substantial industrial demand alongside investment demand. Manufacturing slowdowns, supply constraints and changing industrial needs can separate its behaviour from gold. The gold/silver ratio is a relative comparison; a high ratio alone does not prove silver must rise.
Dollar prices differ from local-currency returns
If measuring performance in toman or lira, both metal prices and exchange rates matter. A higher local price does not necessarily mean a higher global price. Comparing physical holdings also involves conversion costs, purity, workmanship and local bid/ask differences, unlike a dollar-denominated contract.
For futures, expiry month and the price curve matter. A continuous chart may be adjusted and need not represent an executable contract price. Check expiry, rolling rules and near-versus-distant contracts before a long holding period.
Translate volatility into account money
First locate structural invalidation, then convert dollar distance per ounce into position size. Many small candles do not guarantee continued calm. Include inflation releases and interest-rate decisions in the plan and allow for widening spreads.
Journal gold and silver separately when evaluating a method. Their ranges, slippage and holding costs need not be similar. Instead of increasing size after several wins, investigate whether results came from disciplined execution or one exceptional market move.
Educational calculation · hypothetical numbers
How much risk does a 15-dollar gold move create?
Hypothetical entry is 2,300 dollars and stop is 2,285 per ounce. The example loss budget is 75 dollars and one assumed lot represents 100 ounces.
| Step | Result and interpretation |
|---|---|
| Price distance | 15 dollars per ounce |
| Maximum ounces before costs | 75 ÷ 15 = 5 ounces |
| Size with an assumed 100-ounce contract | 5 ÷ 100 = 0.05 lots |
| If the actual exit is 2,282 | 18 × 5 = 90 dollars lost before other costs |
These are neither current prices nor CAPITEX contract specifications. Read the actual contract size in the platform and allow for costs. The example shows that a normal stop is not a guaranteed loss ceiling.
Before submitting an order
- I identified ounces per contract and settlement currency.
- I reviewed dollar and interest-rate news.
- I know overnight costs or expiry dates.
- I did not assume identical contract values for gold and silver.
Mistakes to recognise
- Treating “safe haven” as a promise of gains without volatility.
- Ignoring account currency and ounce units.
- Buying silver only because the gold/silver ratio rose.
Check your understanding
Does a rise in gold priced in lira prove dollar gold rose?
Show answer and reasoning
No. Dollar gold may be unchanged while the lira weakens. Analyse global metal price and exchange-rate components separately.
Key terms
- Troy ounce
- A common precious-metal mass unit, approximately 31.1035 grams.
- Real yield
- Yield after accounting for inflation; market analysis often also considers inflation expectations.
- Expiry
- The contract’s end or settlement time under its rules.
For further reading
This guide was independently written. The official sources below support further study of the concepts; product rules and local regulations may differ.
This guide is educational, not a personal buy or sell recommendation. Examples do not establish specifications of products offered by CAPITEX.