From the November/December 2020 Gold Prospectors Magazine
Dave Varabioff is the owner of the Colorado Quartz Mine and Goldbay.com He has spent decades prospecting, mining, buying and selling gold. While Dave has seen prospectors successfully sell their gold in numerous ways, he’s also seen a range of changes in the gold market that have affected the ways gold is now bought and sold. Here are a few of his thoughts on selling gold today.
On Selling Your Gold
Q: It seems like the best place to start for selling gold would be a jewelry store. Is that a good idea?
A: The jewelry store business has changed. There was a time where jewelers had experts on staff who sat at workbenches crafting and repairing jewelry. You rarely see that anymore. What you see today are large, retail operations that buy their jewelry from manufacturers around the world, and then simply display and resell the jewelry in a retail environment. The vast majority of jewelry stores work with “finished goods” and raw gold does not fall into that category.
Q: What about nuggets? I’ve seen them in jewelry. Would that be different than gold dust?
A: There was a time when nugget jewelry was all the rage. That was back in the 1980s and a nugget would command 3 times the spot price of gold and more. The mainstream jewelry buyers are no longer buying this type of jewelry in mass and as a result, the demand for this type of jewelry is now mostly on cruise ships to Alaska and gold prospectors and enthusiasts.
Q: Gold crystals show up on the Internet from time to time. Even gold in quartz crystals. Should someone break those up? Are they worth anything?
A: I specialize in dendritic gold crystals. I’ve sold many to museums, including The Smithsonian Institution. If you find a dendritic gold crystal treat it carefully and know that you have found something extremely rare and valuable. Gold crystals are the rarest of all the forms of gold and are definitely more valuable than nuggets and dust.
Q: A lot of people seem to be selling their gold on eBay. Are there any tricks to selling gold online that way?
A: I haven’t had the best experience with online shopping forums like eBay. The quality of the products were inconsistent and I just don’t buy gold that way anymore. It’s one of the things that motivated me to get in the business of buying and selling gold. Ebay also charges about 11% commission for a seller to sell anything, and then you have transaction fees of about 3% so off the top you lose 15% or so and for me its not worth it. that is why I started my own website in 1999.
Q: Is there anything a prospector should do with their gold before they sell or any tests required?
A: There are various gold tests you can do before you try to sell your gold. You can improvise a way to do a specific gravity test to assess the amount of gold in ore and I have instructions on my website. You could also take your gold to someone like a jeweler or pawn shop with an XRF gun (X-Ray Fluorescence) which analyzes the properties of a gold sample to determine purity. They’ll charge you for the service but it’s good to know. And you should also weigh it with a digital scale set to measure in grams so you have an idea of what your sample weighs.
Q: Some people melt their gold. Does that make it easier to sell?
A: DO NOT melt your gold. It can be dangerous, can vaporize (fume) off some of the gold and only creates an alloy of gold and other minerals that is no more or less pure than the original gold you were melting. It also reduces nuggets and especially gold in quartz to a commodity destroying any collectible or intrinsic value that it may have in its natural form. Melting your gold is virtually NEVER a good idea.
Q: Mercury shows up from time to time as a way to clean gold. Does that really work?
A: Don’t use mercury to clean up your gold. It’s dangerous as in deadly, illegal, labor intensive and very expensive to dispose of legally. It also is not as effective as most people think. It’s an old prospector’s trick long and best forgotten. Mercury was never used to “clean” gold and in fact it needs to be cleaned FROM gold to make your gold marketable.
Q: Will brokers or companies buy any amount of gold even if it’s just a small amount?
A: Don’t assume that any amount of gold is marketable. Gold buyers have minimum weights for any transaction depending on the form or type. If you have a very small amount, the shipping and insurance and transaction costs may not make it worthwhile to sell
Q: In your opinion what do you think is the easiest way for people to sell their gold, and get the highest price?
A: There are 2 parts to this answer. First, find someone who specializes in raw and natural gold. Someone who has a track record and reviews you can research. Some of the social media groups can help with this. Second, and this is my strongest reccomendation is to go to your local GPAA club! There are many members in the clubs who will either be interested in buying it, the club might buy it and if there aren’t any members or the club itself that want to buy it someone will be sure to know who your best bet is in your local area or even online. Being involved in a GPAA club is a lot more than just the mining properties, and it is the people you meet with the extensive knowledge of the entire industry that have this be one of the best hobbies on the planet. It is estimated that only 5% of the planet’s gold has ever been found, so get out there and get your share! .
The Way Gold Sales Should Be…
I set up my business to meet the expectations I always had as a prospector and miner.
• If someone sends me some gold for a possible sale, I send them a mailing label and instructions on what to do to clean it up and package it.
• I do an analysis for purity using technologies like XRF guns and share the results with a seller as one of the variables for a final price.
• I’ll usually pay a percentage of the price ranging for 80% to 120% of the spot price of gold.
• I estimate the purchase price based on that percentage of the spot price for gold on the day I receive it and send an electronic check via email that same day.
Find Dave online at Goldbay.com