Timing the market with wire transfers from New Zealand - are prices locked in on initiating payment?
IndividualFreedom
Posts: 12 Tin ✭
Hi from New Zealand
- Huge fan of bitgold and Peter Schiff - hope you don't mind me asking questions that may or may not unveil some disadvantages of the deposit system and withdrawal system at bitgold compared to other systems.
- Even if you confirm all of the drawbacks I suspect to be true it will not stop me from investing heavily in bitgold as the best option for me. Let me explain my question:
I guess to summarise my inquiry, I am comparing this system to an online exchange website where you hold funds on the website in NZD as well as gold and can time the market etc. instantly and get in and get out without paying wire transfer fees (i.e. paying a trading fee but avoiding the movement of currency through an expensive wire transfer system every time you get in and get out).
Buying gold:
==========
1) Wire transfer fees
- I am from New Zealand and as such will pay a $15 wire transfer fee from my bank.
- Could I also be subject to fees from other intermediary banks (maybe another $20 on top)?
[[By no means a deal-breaker but would change my investment behavior to sending larger sums on a less regular basis to average out this larger fixed cost per wire transfer. I can accept this cost because any other international competitors selling physical bullion also require that I pay this fee! ]]
2) Timing the market
- If I were to see that the spot price of gold has dropped to an attractive price, this would influence me to buy at that moment.
- However, I am afraid that when I initiate say a $3000 deposit (minus $15-35 of fees) that the spot price may go up very sharply in the 2-3 business days that it takes for my payment to arrive and I will be left paying a higher price than intended.
- Is this a risk that I am taking with bitgold? OR alternatively...
- Are prices locked in at the initiation of the wire transfer (obviously as long as payment is subsequently honoured)?
3 Depth of order book and true spot price
- Without being able to see the depth of the order book I don't see how you can guarantee a given price for my order (e.g. in the extreme case, if I purchased $100 million at the market price it would clear out the order book and push the average spot price very high).
- (This is where I am finding a possible area that lacks in transparency with the final price / gram compared to an online exchange where you see the entire depth of the order book) -- Again this is less of a concern for me because I am a little fish and will have negligible influence on the price but I think maybe you could look at implementing a live order book from wherever you derive your spot price purchases - e.g. show the order book for each respective vault and guarantee whatever price is calculated at the time of initiating a wire transfer? ]] * Maybe this is why you limit the maximum account size... so you can garauntee whatever price you quote on deposit + fees??
Selling gold:
==========
In the same vein I would like it if I could sell my gold bullion back to NZD when gold prices are high but avoid having to pay a large wire transfer fee in order to do so.
- Will you perhaps add the facility to hold onto my NZD currency balance in canada so I can buy and sell avoiding the wire transfer fees?
- Is this possible or is it that case that I will need to sell my gold + 1% fee + wire transfer fees every time I sell my gold.
- [[(This is okay - Will not stop me investing - Would just mean I do it in more infrequent, larger chunks and never for moving smaller amounts).]]
Any clarification or information will be much appreciated. I really would like a hypothetical example with e.g. $100,000 bought and sold from New Zealand to illustrate all possible/likely fees and even possible slippage with clearing out sellers of the order book. Also any plans for future development of features that may mitigate some of these drawbacks (if what I say is accurate).
I love what you guys are doing. I believe that central banks and money printing must be abolished and gold / silver is the best form of sound money. Keep up the good fight!
Kind Regards
- Huge fan of bitgold and Peter Schiff - hope you don't mind me asking questions that may or may not unveil some disadvantages of the deposit system and withdrawal system at bitgold compared to other systems.
- Even if you confirm all of the drawbacks I suspect to be true it will not stop me from investing heavily in bitgold as the best option for me. Let me explain my question:
I guess to summarise my inquiry, I am comparing this system to an online exchange website where you hold funds on the website in NZD as well as gold and can time the market etc. instantly and get in and get out without paying wire transfer fees (i.e. paying a trading fee but avoiding the movement of currency through an expensive wire transfer system every time you get in and get out).
Buying gold:
==========
1) Wire transfer fees
- I am from New Zealand and as such will pay a $15 wire transfer fee from my bank.
- Could I also be subject to fees from other intermediary banks (maybe another $20 on top)?
[[By no means a deal-breaker but would change my investment behavior to sending larger sums on a less regular basis to average out this larger fixed cost per wire transfer. I can accept this cost because any other international competitors selling physical bullion also require that I pay this fee! ]]
2) Timing the market
- If I were to see that the spot price of gold has dropped to an attractive price, this would influence me to buy at that moment.
- However, I am afraid that when I initiate say a $3000 deposit (minus $15-35 of fees) that the spot price may go up very sharply in the 2-3 business days that it takes for my payment to arrive and I will be left paying a higher price than intended.
- Is this a risk that I am taking with bitgold? OR alternatively...
- Are prices locked in at the initiation of the wire transfer (obviously as long as payment is subsequently honoured)?
3 Depth of order book and true spot price
- Without being able to see the depth of the order book I don't see how you can guarantee a given price for my order (e.g. in the extreme case, if I purchased $100 million at the market price it would clear out the order book and push the average spot price very high).
- (This is where I am finding a possible area that lacks in transparency with the final price / gram compared to an online exchange where you see the entire depth of the order book) -- Again this is less of a concern for me because I am a little fish and will have negligible influence on the price but I think maybe you could look at implementing a live order book from wherever you derive your spot price purchases - e.g. show the order book for each respective vault and guarantee whatever price is calculated at the time of initiating a wire transfer? ]] * Maybe this is why you limit the maximum account size... so you can garauntee whatever price you quote on deposit + fees??
Selling gold:
==========
In the same vein I would like it if I could sell my gold bullion back to NZD when gold prices are high but avoid having to pay a large wire transfer fee in order to do so.
- Will you perhaps add the facility to hold onto my NZD currency balance in canada so I can buy and sell avoiding the wire transfer fees?
- Is this possible or is it that case that I will need to sell my gold + 1% fee + wire transfer fees every time I sell my gold.
- [[(This is okay - Will not stop me investing - Would just mean I do it in more infrequent, larger chunks and never for moving smaller amounts).]]
Any clarification or information will be much appreciated. I really would like a hypothetical example with e.g. $100,000 bought and sold from New Zealand to illustrate all possible/likely fees and even possible slippage with clearing out sellers of the order book. Also any plans for future development of features that may mitigate some of these drawbacks (if what I say is accurate).
I love what you guys are doing. I believe that central banks and money printing must be abolished and gold / silver is the best form of sound money. Keep up the good fight!
Kind Regards
Tagged:
Answers
checkout https://www.goldmoney.com (the original GoldMoney, soon to be rebranded Goldmoney Wealth)
With BitGold your price is locked in, but what you see is the BBO average, not the actual price you will get.
See http://support.bitgold.com/customer/en/portal/articles/1871471-aurum-and-gold-pricing
Yes knowing the bid / ask points would be a big plus.
PS welcome to the community
@IndividualFreedom
Welcome to the community.
Have you left a voicemail message when calling in? Due to time differences you are likely calling us out of office hours, which is why we make the voicemail option available. We are very sorry to have missed you by phone, but unfortunately our agents would not have had any new information for you.
Once we send a wire, it is up to the banking system to get it from point A to point B. I have been chasing the bank for more information, but when a trace takes this long, it is likely that information is being obtained from the receiving bank.
If the calls were out of hours, then the automated voice should not be saying "Your call is important to us . . . etc" periodically.
How long must I wait before contacting you again?
- When I say "almost the same cost" what I mean is that if I calculate the round trip cost of 1% in and 1% out + $15-35 in and $15-35 on the way back out to NZD. It would cost almost the same amount to just have bought and held physical gold/silver... so the wire transfer fee is really important for me to know and I don't want to waste a decent sum of money to just test it and find out. Would rather just hear from a fellow New Zealander who has transferred some funds and knows what it ended up costing. (You can still get free shipping to New Zealand for over $6000 worth of gold/silver for those wondering about why I am not including the shipping costs associated with buying physical)
You have navigate to Deposit > Additional Options > Next > More > Next > Select Vault > Next > Enter Amount (change to AUD and if you are lucky NZD) > Process. This will save you you the wire transfer fee at least one way.
I know it’s only a few cents but if this standard practice, I’ve been robbed for quite a few years. I’ve always enjoyed watching the daily price fluctuate. But it doesn’t matter what you show on the site, it seems you’ll charge whatever you want. 🤷🏻♂️