With the price of gold and silver skyrocketing every single day, more people are coming into the realization that buying gold & silver are both very good ideas. So because of this, many questions are being asked by people whether or not APMEX is a good place to purchase gold and silver bullion from.

The answer is a little more difficult than you may understand, so here’s my absolute best explanation of why I feel they are not the best place to buy gold and silver from. Also later on are the suggestions that I have for who you should consider buying coins and bullion from. This is all during the time that I have personally spent in research and evaluating the various coin and bullion dealers online.

APMEX

stands for the “American Precious Metals Exchange” , they’ve been around since 2003 , but their parent company called Edmond Coins has been around since just about 1999. They’re quite reputable, and that is not up for debate, if you want to buy gold you can go with them and buy it. However I have a few concerns about how they sell and deal with gold bullion and other sales.

Here’s a few issues I have with the way they do business. These are from my dealings with their company and what users have suggested by submitting comments.

1. Higher spot yields (Higher prices than many others).
2. Some un-delt with complaints from the BBB and other forums. (Ref)
3. Refuses to sell during times of high volatility. (Ref)

There are a few more reasons as to why I’m not a huge fan , but these are the main ones.

The first obvious one is my biggest problem , by far they are NOT THE CHEAPEST PLACE TO BUY GOLD FROM! I checked today as the markets were down for a few 1oz gold coins to find out that they wanted nearly $100 over ‘spot price’. If you’re unfamiliar with the term, the stock market & futures markets decide the price of gold, this is different from many other markets out there. Investor demand is what increases and decreases the price of gold and silver more than industrial demand or any other thing. Because of this the price of gold and silver are very public things. Mints and other groups buy contracts for these metals, mint them into bars or coins and then either directly sell them to investors and groups or sell them to 3rd parties. Now , normally when the US mint comes out with a coin like the ‘Golden Eagle’ they will sell it for a while on their own website, then move to investment companies. Normally they just take the price of gold, add $20 or $30 to it and sell it like that, however apmex has been buying them out of coins and then re-selling them for $50 to $100 over that value. This increases the cost of a investment or whatever you spend on coins, and should the market stay stagnant or have a small decrease, this will rapidly decrease your investment. They do offer a ‘Buying service’ should you want to sell your coins back to them , however it is normally 10% to 20% under spot price which makes you wonder how much they REALLY pay for their gold & silver.

As I also said, there are a few known problems with their business practices. I’ve read about a few hundred or two hundred un-resolved complaints on various coin forums and consumer advocacy websites.  I can’t say I always give these websites full benefit of doubt, however there’s too many just to look the other way. You can’t run a business and have over 150 complaints lodged and then go on to ignore them.

Finally , APMEX does not sell during times of high market volatility. This should worry you as a investor because on 8-7-2011 they shut down sales of gold because the market was ‘too volatile’. This means should anything bad happen in the world economy, which directly effects the price of gold and silver there is quite a good chance that they will refuse to sell you gold and wait till the price increases. Of course this is a one-way street and if prices started to drop suddenly, they wouldn’t cut off sales or such. This isn’t to say it’s illegal , just in bad taste in my eyes. You need to keep your alternatives open just in case they close down sales during a high market time.

Here’s a screen shot of their website during a time of ‘high volatility’ –

So , who do I suggest using instead of apmex? Well , first off, please try GoldSilver.com , they’re one of the absolute best companies I’ve worked with for silver and gold purchasing. On almost every item they’re identical to apmex’s pricing, however on many other coins they’re actually less. On top of this, I’ve NEVER seen them shut down sales in times of uncertainty. Now when it comes down to it, do you want a company that will leave you high and dry when the market is volatile? I know I would never want to do business with a company that does that, and GoldSilver.com doesn’t do that.

History

Edmond Coins and American Precious Metals Exchange were founded in 1999 by Scott Thomas. APMEX.com was launched in 2003 and began trading PMs , gold and silver bullion and other coins made out of precious metals.

They are extremely active in both buying and selling most types of precious metal products, especially bars and coins. They carry all U.S. Mint bullion products including gold, silver and platinum American Eagles. They also sell many Royal Canadian Mint Products including the gold, silver, platinum and palladium Maple Leafs, as well as Krugerrands of South Africa, and Philharmonics from Austria. Additionally, they make markets in most bullion coins from any other foreign country.

The principals of APMEX are members of the American Numismatic Association and many other industry organizations. They are regularly quoted as authorities in the precious metal field by such publications as Newsweek and The Wall Street Journal.

APMEX was chosen by an undisclosed party in 2009 to sell 1 of 5 $1 million face value coins produced in 2007 by the Royal Canadian Mint. According to a story by The Oklahoman, APMEX was chosen because it markets to thousands of gold and coin enthusiasts through its Web site.

APMEX is annually audited by the firm Grant Thornton LLP.