Gold Bullion Coins In Today’s Investment World
Bullion is a precious metal in its purest form. This term is most familiar when used in conjunction with gold or silver. Gold has been used as a form of tender since the days of Croesus, although those coins were more likely an amalgam of gold and silver. China also has an ancient history involving gold coins as do most modern countries.
A notable event relative to gold coins came about in 1933 when the United State government, in response to the grim circumstances of the Great Depression, for the most part uncoupled the value of the U.S. Dollar from the value of gold and ordered that gold coins be turned in exchange for paper currency. Most of the coins thus amassed were melted and recast as ingots. The ostensible purpose for this move was to minimize hoarding and to try to revive some economic activity. The thinking was that people would not be inclined to hoard paper money and would be forced either to deposit money in a bank or to spend it.
The purity and durability of bullion lends it to be used as specie but the market driven value of gold now makes this an unlikely use. Gold bullion is often cast as ingots of 400 Troy ounces, about 27.4 pounds, or 12.4 kilograms, so it can be stored by banks or traded among bullion traders. A smaller ingot, weighing 1,000 grams and called a kilobar, is the same bullion in a form that is easier to handle for business transactions.
The gold bullion coin is basically a way to make gold easier to buy and sell, particularly for the small investor. Its designation as legal tender makes transnational movement much easier than it would be otherwise. Such coins are often one ounce in weight - about the size of a silver dollar - and range down to sizes of one-half, one-quarter, one-tenth, even one-twentieth an ounce. The tenth ounce coin is about the size of a dime. While the commodities market trades in gold futures, it is rare that such a contract would be fulfilled by the delivery of gold. In addition, the desire by some people to have and hold an item of value very often plays a part in the decision to buy gold bullion coins. The coins that are struck as legal tender, have a face value but it is for reference purposes as the underlying value of the gold is much higher. The South African Kruggerand and the Canadian Gold Maple Leaf are two well-known examples of a one ounce gold bullion coin. The Maple Leaf is .9999 per cent gold while the Krugerrand is an alloy with 90 per cent purity; the Krugerrand is an alloy as it was originally created to be circulated as a coin. Both coins are available in fractional sizes of an ounce.
Since the days of the Nixon administration, it has been legal for Americans to own gold, other than as jewelry. A number of businesses buy and sell gold bullion coins, locally as well as on the internet. As in any such transaction, it is best to know as much as possible about a seller or a buyer if one is seeking to cash in gold bullion coins. The price of gold has climbed quite high in this century as economic turmoil has wreaked havoc on other more traditional investments. Consequently undertaking an investment in a gold bullion coin should only be undertaken with a well established understanding of the price fluctuations that might ensue. Nonetheless, as it has been for two thousand years, gold is a very solid investment.
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SafeAsGold.com Today's Talking Points - B of A reports that gold bullion has outperformed the S and P 500. -Warren Buffet has reported the days of double digit returns in the stock market are over. - If you have an IRA you should consider rolling it over to solid gold. Listeners are always welcome to receive a free gold investment guide by going to www.safeasgold.com or call 1(800)510-9594. If you'd like to listen to the rest of the show, you can do so via The Gold Show with Jonathan Rose podcast. Go to the following link to subscribe to the podcast. itunes.apple.com
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Buy Krugerrands as a Safe Investment
We live in uncertain times. The more prudent investors have recently been turning to one of the safer forms of investment - gold, and gold coins in particular. Gold prices hit 00 on ounce earlier this year as investors plied their savings into stocks of the precious metal. According to the World Gold Council total investment in gold rose by 163% in the first quarter alone.
One of the most popular ways to invest in gold is to buy gold coins such as Krugerrands or Sovereigns. Items such as Krugerrand coins, which individually are 1oz of pure gold, are easily available from such diverse places as on-line auction site EBay.. Many industry commentators are openly suggesting that investors buy stocks of gold coins as safe, long term investments.
When comparing your options for buying gold coins there are several factors to consider depending on which coin you are buying.
The main factor is to compare the percentage over the standard market gold price for each type of coin.
Gold Sovereigns
Experts believe that Sovereigns are often worth paying the slight extra premium for. Their small size and historic significance make them very attractive to most investors.. Sovereigns are better known that some other types of gold coins, Krugerrand coins for example, and have the added advantage of being exempt from Capital Gains Tax if you live in the UK. It is suggested that if you can buy sovereigns within 2% of the price of Krugerrands coins that this makes them a better long term buy.
Krugerrand Coins
Krugerrand coins are the best known of all the modern gold bullion coins. These one ounce solid gold coins are more easily available in greater quantities and can generally be bought at lower prices than any other. In comparison to sovereigns, Krugerrand coins do not look as nice, nor are they of such historical significance, but as a solid investment they are still extremely popular. What they lack in looks, however, they make up for in high production quality and they are a cost effective way for small investors to buy gold.
If you are considering buying gold coins as an investment then I can recommend http://buycheapgoldcoins.com as a good starting place.
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Now on eBay:
South Africa Gold Krugerrand, 1975 Bullion
$1,620.00
2h 25m
1997 SOUTH AFRICA GOLD 4 COIN 30TH ANNIVERSARY KRUGERRAND SET NGC PROOF 69/70 UC
$4,500.00
27d 16h 32m
South Africa Gold Krugerrand, 1979 Bullion 1 Ounce
$1,625.00
1d 5h 13m
