Segregated vs. Allocated Gold Storage: What Investors Miss -

Allocated vs. Segregated Storage: Why Most Investors Don’t Know What They Actually Own

Lately, I’ve seen more podcasts, blogs, and dealer-backed media asking if major vaults actually hold what they say they do. And honestly, it’s about time. But most of these conversations are a mess—full of marketing spin, half-truths, and confusion. Especially when people start throwing around terms like allocated, segregated, and unallocated like they mean the same thing.

Here’s the deal: I’ve managed a gold and silver storage program. I run a physical bullion fund. I’ve seen how this industry works—and more importantly, where it breaks down for real clients.

So let’s cut through the noise and clear up the biggest myths still floating around out there.

What Most Programs Don’t Want You to Understand

Over the last five years, I’ve analyzed nearly every major precious metals storage program in the world. And I’ve done it from the client’s perspective—not the dealer’s.

Most storage structures are optimized for the institution’s benefit, not yours. They prioritize:

Cost efficiency through large bar purchases
Commingling of client metals
Systems that make delivery difficult, delayed, or conditional

This is exactly why I built my own storage program: None of the existing options met the fiduciary standards I believe clients deserve.

The Big Misconception: Allocated ≠ Fully Segregated

A lot of financial shows—and even some advisors—incorrectly claim that allocated storage is the safest option. That’s false.

If you want:

Direct legal title
The ability to take delivery at any time
The same bar or coin returned to you that you originally bought

Then fully segregated storage is the only choice.

Definitions Matter

Allocate – To designate something for a specific purpose
Segregate – To isolate completely from others

Allocated accounts may still commingle metals across clients, programs, or dealers—even if your name is “on the list.”

Common Allocated Structures (and Their Risks)

Here’s a typical setup:
Let’s say 10 clients each buy 100 ounces of silver through a dealer. That dealer stores metal on their behalf.

They might:

Store pooled metal in a dealer-controlled vault compartment
Buy a single 1,000 oz silver bar to represent all 10 clients’ holdings

In both cases:

You don’t get the same bar back you originally bought
You might receive a different refiner’s bar upon delivery
Delivery could be delayed, restricted, or replaced with generic material

This is still “allocated” storage—but with very real delivery and liquidity risks.

Fully Segregated Storage: Real Ownership, Real Access

With a fully segregated account:

Your metals are kept physically separate from all other clients and programs
You maintain direct legal title
The metal is untouchable by the vault or the institution—unless specified in the storage agreement

And most importantly:

The metal you put in is the exact metal you get out.

If you want genuine access to your metals—audit-ready, deliverable, and intact—this is the only acceptable structure.

Who Is Allocated Storage Really For?

Allocated storage may work fine for clients who:

Want price exposure
Never plan to take delivery
Are indifferent to what bar or refiner they get back

But if you’re using physical gold or silver as protection against:

Systemic risk
Currency devaluation
Geopolitical instability

Then you must store your metal in a fully segregated environment. Anything less introduces unnecessary counterparty exposure.

The LBMA & COMEX Vault Myth

Another myth floating around is that your metals must be stored in an LBMA- or COMEX-approved facility or else they’ll lose value.

You’ll hear things like:

“Once your metal leaves the chain of integrity, it’ll cost a fortune to assay or transport it.”

Not true.

A basic assay is often inexpensive
.9999 fine gold and .999 silver coins held in private vaults have the same value as those stored in an “approved” facility

The real question isn’t where your metal sits.
It’s: Do you trust the vault holding it?

Final Thoughts: Structure Is Everything

If your account isn’t explicitly labeled fully segregated, and you’re planning for future delivery, you should be very concerned.

Most vault programs aren’t designed to serve the client—they’re structured to serve the firm. That’s why I’ve built my storage systems around a different philosophy:

Clients come first. Not the vault–Not the dealer–Not the platform.

Gold and silver are protective assets. So your storage program should protect your interests—not limit them.