More investors are now considering gold coins an attractive investment option and a means to hedge their investment against inflation. The stock market and banking system has shown that it is not a totally dependable means of storing value or securing investments, and so investors are turning to gold as a means of storing value. This page will act as your guide to buying gold coins.
Gold is considered a reliable store of value because it is easily transferable and is accepted and valued all over the world. For those who are just branching into the filed of gold buying, here is a quick beginner’s guide to buying gold coins.
People buy gold for a number of reasons. While some buy gold as a form of investment or to store value others buy and collect gold coins mainly for pleasure. Whatever the reason you are buying gold you need to first get more information about gold buying to be successful. Information such as types of gold, how they are classified and valued would help you greatly.
Gold Bullion Versus Gold Numismatics
When you buy gold you are either buying gold bullion or numismatics. Gold in its pure form or close to pure forms are classified under gold bullion (between 0.90 and 0.9999 fineness). Minted or commemorative coins on the other hand usually fall under what is referred to as numismatics. The popular unit for measuring gold used to ounce but now gram seems to be more widely used.
Those interested in gold bullion could either go for bullion coins (which are easier to sell) or gold bars.
There are various types of rare and antique numismatic gold coins. Numismatic coins are usually favored by those interested in buying gold as a collector’s item although they are still a good investment. Due to their age and design they could have more value in the collectors market beyond the value of their gold content — they might also be extremely overpriced.
Read our article on pre-1933 gold coins to learn more about overpriced antique coins.
Take note that when the general price of gold is increasing the value of numismatic gold coins would increase greater in comparison to gold bullion. When the general price of gold is falling the inverse would be true.
Seek Out Credible Sellers
Now that you are armed with a little basic knowledge it is time to seek out credible websites to buy gold from. Do not be too hasty but take your time to scrutinize the website first. You would need to consider how long they have been in business, their usual type of clientele and if they specialize in just a segment of the market. Some credible websites to buy gold include the Morgan Gold, Merit Financial, and Golden Eagle Coins.
Gold Coins Buying Tips
Remember that there are many types of gold. What you buy may depend on your preference. It is however advised that you go for coins and bars with one troy ounce size since they are very popular and easy to sell. When buying online you should request to see a picture.
You can confirm the authenticity of the gold piece by checking for the serial number and calling the grading service. The Numismatic Guarantee Corporation and the Professional Coin Grading Service (PCGS) are in charge of certifying coins and coin dealers in the U.S.
If you are buying on Ebay, be extra careful when dealing with Chinese or Oriental sellers as some have been known to be fraudulent.
Other Gold Investment Options
Other available investing in gold options apart from buying actual gold bars and coins include buying gold certificates, stocks of mining companies and metal and gold futures.
When you buy gold certificates it means that you do not actually take possession of the gold. The certificate indicates that a certain amount of gold has been bought and reserved for you. The Perth Mint in Australia is the only government backed gold certificate in the world. The others are considered risky.
Purchasing gold stocks or stocks in mining companies gives you a stake in the company. That way you share in its profit or losses. If you are interested in buying gold stocks it is advised that you buy a basket of stocks of different companies to spread your risk. This is especially true if you are deciding to go that route instead of purchasing gold coins for the first time, or aren’t planning on buying gold a little at a time.
Gold futures are bought on margin or mostly with credit with only a fraction of the price paid upfront. Futures are an agreement or commitment to buy or sell a specified amount of gold at given time and price.