For beginners, starting a gold bullion collection is a wise and bold move. Still, there are many challenges, especially for one who has zero experience in collecting coins. So, what are the need-to-know facts regarding collecting gold bullion coins? This article will tackle the worth of bullion coins and discuss some issues regarding the best options for new collectors.
How much is a gold bullion coin worth?
The value of a gold bullion coin depends on its weight. For instance, the American Eagle, which is a popular choice, is available in the following weights: 1 ounce, half, quarter and tenth of an ounce. The price of a gold bullion coin usually varies daily and depends on the current spot price of gold.
What is the spot price of gold?
The spot price of gold changes each day because the price of gold fluctuates as it is traded in the world market. At this moment, the spot price of gold is $1,614, and American Eagle coins are sold for $1,666 to $1,709 an ounce. Some traders also add a premium over the spot price. So, if the spot is $1,600 and a 1-ounce bullion coin is sold for $1,650, this means that the premium is $50. In other words, the premium is the value added over the current spot price of gold, wherein the spot price depends on the intrinsic value of the metal.
What are the best options for new collectors?
Among the most popular gold bullion coins out there are the following:
1. American Eagle (US)
2. Krugerrand (South Africa)
3. Maple Leaf (Canada)
4. American Buffalo (US)
5. Philharmonic (Austria)
Any of these coins will be wise choices. There are still many good coins to choose from, such as the Australian Kangaroos, Chinese Pandas, and many others. These are stable coins with lovely decorations on the reverse side. But collectors should remember that collecting gold bullion coins is not really based on how beautiful or rare a coin is, unlike numismatic coins. Instead, the most basic feature when assessing a gold bullion coin is its fineness or its weight in gold. The most established coins that are sure to hold their value are those with fineness between 916.7 and 999.9. But apart from bullion coins, other great investment choices are the Saint-Gaudens Double Eagle coins and Proof coins.
Saint-Gaudens Double Eagle Coins
These are twenty dollar gold coins minted between 1907 and 1933. Depending on the date minted and the grading or the condition of the coin, some Double Eagle coins are more expensive than others. Among all the Saint-Gaudens coins, it is the 1933 Double Eagle that's considered as the most expensive. The coins made in 1933 were never officially issued because of the extreme economic changes during the Great Depression. The government ordered for the 1933 Double Eagles to be melted. The few 1933 Saint-Gaudens Double Eagle coins that were able to escape being melted are prized above others of the same type.
Proof Coins
A proof coin is a type of coin that has an excellent finish, much better than an uncirculated coin, as it is struck using first-rate minting tools. Proof coins may not be a good choice for new investors or collectors. But it really all depends on what a person plans to do with a coin. If the goal is to purchase and trade gold, it's best to go for the more popular types, like those mentioned above. But for those who also prefer to display valuable bullion coins with extremely high quality finish, then proof coins are apt choices.