Long Position

A long position in the context of precious metals means that a dealer or investor holds a quantity of metal that exceeds their sales obligations. In this position, the holder is exposed to price increases, potentially benefiting from a market upswing before selling the inventory.

Long positions are common in physical metals trading, where dealers maintain stocks of gold, silver, platinum, or palladium in anticipation of future customer demand. While holding a long position carries the risk of price declines, traders can implement hedging strategies - such as selling futures contracts - to protect against unfavorable movements.

The opposite of a long position is a short position, in which a trader sells metal they do not yet own, anticipating a price drop before buying it back.