Allocated Gold: What You Actually Own (And What You Don’t)
Key Takeaways
- Allocated gold means you legally own specific physical gold bars or coins that are held in custody on your behalf
- The gold is typically stored on a fully segregated basis and it does not sit on the provider’s balance sheet
- Allocated gold differs from ETFs or derivatives because it provides direct ownership of physical metal rather than price exposure through a financial instrument
Introduction to Allocated Gold
When investors say they “own gold” they can mean very different things. Gold can be held in physical or paper form, represented through financial products or recorded as a balance on an account. Each method carries different legal rights, risks and implications, particularly when it comes to ownership.
Allocated gold is one of the clearest and most straightforward ways to own gold. Yet it is often misunderstood or confused with other forms of gold exposure. This article explains what allocated gold ownership really means, how it works in practice and how it compares with other ways of owning gold.
What Is Allocated Gold?
Allocated gold means you own specific, identifiable physical gold bars or coins that are held in custody on your behalf. When you buy allocated gold with GoldCore, the gold exists as tangible metal, stored in a LBMA-approved secure vault and is legally your property.
In an allocated arrangement:
- The gold is fully owned by the investor rather than the provider
- Your holdings are specifically identifiable, often by serial number, weight, fineness or refiner
- The metal is held under a bailment structure, meaning legal title remains with the client at all times
- The gold is segregated and stored separately from the holdings of other clients
This structure ensures that ownership does not depend on the financial health of GoldCore or the vault operator. Even in the unlikely event that GoldCore or the storage provider were to fail, allocated gold remains the property of the client and is not part of GoldCore’s balance sheet.
Fully Segregated Storage and Legal Ownership
With fully segregated, allocated storage, your gold is not pooled or mixed with other investors’ holdings. It is stored in a specific location under your account number, within a LBMA-recognised, high-security vault operated by professional custodians.
Because the gold is held under bailment law, the relationship is legally defined:
- The client, known as the bailor, retains ownership
- The provider, acting as bailee, has a legal obligation to safeguard and return the identical bars or coins on request
- The custodian stores the metal but does not own it
These definitions are what separate ownership of physical gold from contractual claims or financial instruments linked to gold.
Transparency, Auditing and Insurance
Allocated gold ownership should be supported by a high level of transparency, such as that offered by GoldCore. Our clients can access personal statements that show:
- Bar or coin descriptions
- Quantity held
- Gross and fine weight
- Purity or refiner
Reputable providers also subject allocated holdings to regular reconciliation and independent audits, including physical inspections by internationally recognised auditors. In addition, professional vaulting facilities carry specialist insurance designed to cover physical loss, theft or damage.
Together, these elements provide confidence that the gold exists, is properly safeguarded and remains under the investor’s ownership.
You can read more about GoldCore’s storage offering and our Six Point Locking System here.
How Allocated Gold Compares to Other Ways of Owning Gold
Allocated gold is one of several ways investors can gain exposure to gold. Others include gold-backed ETFs, futures contracts and unallocated accounts. Each serves a different purpose.
Gold ETFs offer price exposure and liquidity, but investors own shares in a fund rather than physical metal. The gold is typically held by custodians on behalf of the fund rather than directly by the shareholder.
Gold futures and derivatives provide exposure to price movements but are financial contracts, often settled in cash rather than metal.
Unallocated gold accounts represent a claim on a quantity of gold rather than ownership of specific bars. These accounts can be efficient for trading, liquidity and short-term positioning, but they differ from allocated ownership.
Allocated gold sits at the physical end of the spectrum. It prioritises direct ownership, clarity of title and long-term wealth preservation rather than trading flexibility. Allocated gold held in GoldCore gives you the closest proximity to your gold, whilst giving you peace of mind when it comes to security and ease of selling should you wish to do so.
What are the benefits of owning allocated gold?
Allocated gold can be:
- Efficiently sold should you wish to liquidate all or some or all of your assets
- Transferred between vaults or jurisdictions
- Taken into personal delivery, subject to logistics or regulations
This independence can matter for investors who value control and flexibility over how or where their gold is held.
Understanding What You Own
Allocated gold is not about outperforming other forms of gold ownership. It is about clarity and proximity to your gold. Investors know exactly what they own, where it is stored and under what legal framework it is held.
For those seeking direct exposure to physical gold with clear ownership rights, allocated gold provides a transparent and well-established structure. Understanding these distinctions allows investors to choose the form of gold ownership that best aligns with their objectives, time horizon or risk preferences.
Frequently Asked Questions About Allocated Gold
What is allocated gold?
Allocated gold is physical gold that is legally owned by an investor and held in custody on their behalf. The investor owns specific bars or coins that are identifiable by weight, purity and often serial number.
Do I legally own allocated gold?
Yes. With allocated gold, the investor is the legal owner of the physical gold. The gold is held under a bailment arrangement, which means ownership remains with the client at all times.
Is allocated gold stored separately from other investors’ gold?
Yes. Allocated gold is typically held on a fully segregated basis. This means the gold is stored separately from the holdings of other clients and is not pooled or commingled.
Is allocated gold on the provider’s balance sheet?
No. Allocated gold is not an asset of the provider. Because the gold is legally owned by the client, it does not form part of the provider’s balance sheet.
How is allocated gold audited?
Allocated gold is usually subject to regular reconciliation and independent audits. This often includes physical inspections by internationally recognised auditors to confirm the existence, weight and purity of the metal.
How does allocated gold differ from gold ETFs?
Allocated gold involves direct ownership of physical gold bars or coins. Gold ETFs provide exposure to the gold price through shares in a fund rather than ownership of specific piece of physical metal.
How does allocated gold differ from unallocated gold?
Allocated gold gives ownership of specific physical bars or coins. Unallocated gold represents a claim on a quantity of gold rather than title to specific items and is often used for liquidity or trading purposes.
Can I take delivery of allocated gold?
With GoldCore, you can take delivery of your allocated gold. When you buy allocated gold with GoldCore, you own specific gold items (bullion bars and coins). Therefore, it can be delivered to you, subject to logistics and regulation.
Is allocated gold insured?
Allocated gold held in professional vaulting facilities is typically covered by specialist insurance designed to protect against physical loss, theft or damage.
