What is XAUUSD? Contract spec, spread, leverage and settlement in one pass

If you see XAUUSD 4074.36 on a broker's quote board and then "today's gold price 936 CNY per gram" in a gold shop, the natural question is whether those two are the same thing. The answer: the same underlying, but not the same tradeable object.

This article takes XAUUSD down to the bottom layer: what the ticker is, how much gold one lot actually represents, what a 0.01 move is worth, how margin and the liquidation price are calculated, why you can never take delivery of a bar, and how it differs from futures and ETFs. All quotes are live snapshots from the XAUAD market data feed, and you can follow along on the today's gold price page.

Snapshot time 2026-10-22 19:06 (Beijing time; this page refreshes every 20 seconds)

1. The one-sentence answer: what XAUUSD is

XAUUSD is the quote for how many dollars one ounce of gold is worth. XAU is the currency code ISO 4217 assigns to gold, USD is the US dollar, and putting the two together gives you the exchange rate of gold against the dollar. It does not refer to any particular bar, nor to any shop's list price, but to a price quoted continuously in the global over-the-counter (OTC) market.

So trading XAUUSD at a broker is essentially taking a position on the price of gold in dollars: go long and you profit when gold rises; go short and you profit when it falls. What you trade is a price contract, not a crate of bars.

2. What exactly separates XAU from XAUUSD

XAU is "gold as a currency", not a different kind of gold

After the Bretton Woods system broke down in the 1970s, ISO 4217 kept a currency code for gold, XAU, defined as one troy ounce (31.1035 g) of pure gold. So XAU itself carries no price; it is only a unit. Price it in dollars and you get XAUUSD.

The same logic gives XAUEUR (gold in euros), XAUSGD (gold in Singapore dollars) and XAUCNY (gold in yuan). The RMB gold price overseas Chinese watch is essentially XAUCNY converted into "yuan per gram".

We cover the concept, the London quoting system and where the spread comes from in more detail in "What is XAUUSD: spot gold, London gold and the spread, fully explained". This article answers a more practical question: what the contract specification is, and how the money on a trade is actually calculated. The two pieces divide the work without overlapping, so read the specification first and the concept after.

XAUUSD, XAU/USD, spot gold: three names for one thing

• XAUUSD: how brokers, MT4/MT5 and APIs write it
• XAU/USD: how financial media and quote sites write it; the slash is just a separator
• Spot gold / London gold: the common Chinese-language name, meaning spot gold in the London OTC market

All three refer to the same quote. But the word "spot" misleads: retail clients trading XAUUSD through a contract for difference (CFD) do not actually receive 100 ounces on T+2 — it is a cash contract on the spot price. Section 8 covers this in detail.

Do not confuse three tickers

3. Why one lot is 100 ounces

It is a historical convention of the London bullion market: a Good Delivery bar is about 400 ounces, OTC dealing quotes and settles in round units of 100 ounces, and retail simply carried that over as "1 standard lot = 100 ounces".

The conversion is worth memorising, because it drives every lot calculation you will ever do:

At the snapshot price of 4,074 USD/oz above, one lot has a notional value of about 407,000 USD (4,074 × 100). That matters — it means even 0.1 lots carries price exposure equivalent to 40,000 USD of gold.

4. Point value: where 0.01 = 1 dollar comes from

Point value is "how much your account changes when the price moves one minimum increment". The formula is trivial, but do not get the direction backwards:

Conversely, every 1 USD move in gold is 100 USD on one lot; a 10 USD move is 1,000 USD. That is why gold is called a volatility amplifier — its daily range is often 30–60 USD, which is 3,000–6,000 USD on a single lot.

Note: some platforms call 0.1 USD "one point", in which case one point is 10 USD per lot. When you see the word "point", confirm the platform's decimal convention instead of borrowing someone else's number.

5. Spread: the invisible fee on every single trade

The spread is the difference between the bid and the ask. You buy at the ask and sell at the bid, and that round trip costs your account a slice before anything else happens. It is the largest fixed cost in short-term trading, and it matters far more than commission.

Here is the live snapshot taken on this page (2026-10-22 19:06 Beijing time, source Swissquote):

0.0162% looks tiny, but in money it is not: on one lot you are 66 USD down the moment you enter; ten trades and it is 660 USD. Gold has to move 0.662 USD in your direction before you are back at break-even.

In normal conditions the gold spread runs about 0.2–0.7 USD/oz; it is tightest in the London-New York overlap (21:00–24:00 Beijing time), and widens to 1–3 USD around the daily settlement and at the instant of nonfarm payrolls or CPI releases, with occasional momentary gaps of tens of dollars. Using market orders into a data release is the most common way beginners blow up an account. To see what a trade actually earns, put the quotes into the gold P&L calculator and it will show the net after spread.

Whether a spread is expensive is about its share of the range, not its absolute size

The same 0.662 USD spread eats a small slice of movement in active hours and a fifth of it in quiet hours. The table below aggregates 5-minute ranges from roughly 1,000 one-minute candles (XAUAD feed / Swissquote), bucketed by Beijing time; the spread is the live reading at 2026-10-23 04:16 of 0.662 USD/oz (bid 4,023.334 / ask 4,023.996, 0.0165% of price):

Sample period 2026-10-22 11:37 to 2026-10-23 04:16 Beijing time, 200 five-minute candles; the Asia and overnight windows are partial, not full sessions.

The conclusion is direct: the spread takes only six tenths as much of the range in the overlap as it does overnight (11.3% versus 17.6%). On the same 5-minute round trip, between 21:00 and 24:00 you only need 0.66 USD of movement to get back to break-even, while at 4 a.m. you have to extract that same 0.66 USD from a market averaging 3.75 USD. Which is why "same position, same stop" gets noticeably harder when moved to the small hours — size up in the cheap window and pull in your horns in the expensive one. For tactics see gold short-term trading techniques and the trading session clock.

6. Leverage and margin: one line of formula

Margin is not a fee; it is your own capital frozen in the account and released when you close. Leverage determines how much gets frozen:

The point of this table is not "higher leverage is better" but that leverage determines how much room you have. On the same 10,000 USD, at 1:500 you can open 12 lots (notional 4.88 million USD) and a 2 USD move against you costs 2,400 USD; at 1:100 you open 2 lots and a 2 USD move costs 400 USD. Leverage does not generate P&L — lot size does.

If you would rather not do it by hand, the margin calculator takes the price, lots and leverage and gives you the answer.

7. How the liquidation price is calculated: how much you can lose, then how big you can go

Liquidation (forced close / stop out) happens when equity ÷ used margin falls below the platform's stop-out ratio, 50% at most platforms and 20%–30% at some offshore ones. The formulas:

Note a counter-intuitive result: on the same 0.5 lots, moving leverage from 1:100 to 1:500 shifts the liquidation distance only from 4.41% to 4.81%. Because the stop-out line is a percentage of margin, less margin also means lower stop-out equity. What really decides how long you survive is lot size relative to capital, not the leverage number. Which is why position rules matter far more than leverage choice — for the practical side see gold short-term trading techniques.

8. Settlement and overnight financing: why you never get a bar

Interbank spot gold (loco London) really is T+2 delivery, transferring 400-ounce standard bars between London vaults. But retail XAUUSD traded as a CFD works differently:

• No expiry: as long as you are not liquidated you can hold indefinitely, unlike futures which must be rolled
• Cash settlement: closing settles the difference in dollars; no bar will ever arrive at your door
• Overnight financing (swap): holding overnight costs or earns interest, usually calculated as "USD rate + platform markup"; longs generally pay and shorts may receive
• Triple swap: most platforms charge three times the financing on Wednesdays to cover the two weekend days of funding cost

9. How XAUUSD differs from gold futures and gold ETFs

In one line: to hold for the long run, an ETF is the least trouble; to trade short term, XAUUSD is the most flexible; futures come into play when you want exchange transparency for hedging. The logic of choosing among the three matches what we set out in the five ways to buy gold overseas.

10. Where the XAUUSD quote comes from

Many beginners assume some "official" body sets the gold price, but it is really a continuous quote from a network of market makers: the London Bullion Market Association (LBMA) OTC market is the pricing centre, a handful of large clearing banks and refiners keep quoting bid and ask, data vendors (Swissquote, Bloomberg) aggregate it and distribute to brokers, and the broker adds its own markup before you see it.

• LBMA fixes: an auction at 10:30 and 15:00 London time each trading day, the valuation benchmark for many contracts and ETFs
• Continuous quoting: opens 06:00 Beijing time Monday, closes 05:00 Friday, almost uninterrupted
• Your fill price: the broker adds a margin to the interbank quote, and that is where the spread you see comes from

This also explains two commonly misunderstood things: quotes differ by a few cents across platforms because the upstream market makers differ; and a domestic gold shop's list price is always above the XAUUSD equivalent because it includes fabrication, brand premium and import and channel costs — the two systems cannot be compared directly.

11. The three most common beginner mistakes

Mistake one: assuming that buying XAUUSD means owning gold

It does not. What you hold is exposure to a price. If you want metal, go through a bullion dealer, a bank or an ETF's redemption channel; the cost structure is entirely different.

Mistake two: treating the spread as a platform commission that another broker would not charge

The spread is the market's bid-ask, present at every platform, only wider or narrower. Regulated platforms' raw-spread accounts can get down to 0.1–0.2 USD but charge commission separately; "zero spread" accounts usually hide the cost in a worse fill. Judge total cost, not one line item.

Mistake three: thinking higher leverage means earning more

Leverage only changes margin usage, never P&L. The outcome is decided by lots × range. People who treat leverage as a return multiplier are usually out of the game on their first 3% adverse move.

12. Frequently asked questions

Q. Are XAUUSD and spot gold the same thing?
A. Same underlying, different mechanism. XAUUSD quotes the spot gold (London gold) price, but when traded at retail through a CFD it is a cash-settled contract with no physical delivery.

Q. How much is one lot of XAUUSD?
A. One standard lot = 100 oz ≈ 3.11 kg. At the snapshot price of 4,074 USD/oz the notional is about 407,000 USD, and 0.01 lots corresponds to 1 oz.

Q. What gold spread counts as normal?
A. 0.2–0.7 USD/oz in normal conditions; the measured snapshot on this page is 0.662 USD (about 0.0162%, or 66.2 USD per lot). It widens to 1–3 USD at the instant of a data release, when market orders are best avoided.

Q. Is 1:500 leverage more likely to make money?
A. No. Leverage only reduces margin usage; P&L comes from lot size. With 10,000 USD at 1:500 you can open 12 lots, and an 8 USD adverse move in gold costs you nearly 10%.

Q. Does XAUUSD ever deliver physical gold?
A. Not at retail through a CFD — it is always cash settled. If you need metal, go through a bullion dealer or an ETF redemption, with entirely different costs and thresholds.