World economies are in a state of flux at the moment, and while China’s economy is still growing, the boom that it was undergoing 5 years ago has declined a little. The American market still hasn’t totally forgotten the Global Financial Crisis that hit back in 2008 either, although it has bounced back.
There are a lot of factors that make investors more cautious in investing in the stock market, bonds market or even trading in currencies. Unless you’re talking about gold coins. With the price of gold and precious metals remaining a secure commodity there is a lot of interest in investing not just in the gold explorers around the world but in having the physical item under lock and key.
Mental images of Disney’s ScroogeMcDuck diving into a vast room filled with gold coins may spring to mind, but savvy investors do understand the value of having a tangible product to invest in. Once that might have been property, but after the subprime mortgages caused the collapse of the property market in America investors around the world have been a little more cautious in over investing their capital into this market.
More than just sparkling investment
If you are looking to invest in gold, you will likely find yourself perusing gold coins for sale. One thing to note if you are wanting to start investing in physical currency, as any coin or stamp collector can tell you, the actual value of the coin may little resemblance to either the face value of the coin or to the actual value of the gold contained in the coin. For example, that random old coin sitting in the bottom of a drawer could well turn out to be an early 1900s Liberty Head Quarter Eagle coin and be worth over $300. As some coins fetch easily over $2,000 despite a face value of significantly less, you can see why those looking for a solid investment become coin collectors.
The Security of Gold
The case in point would be the story of the 1933 Double Eagle – which sold for $7.6 million. Why? Because in an attempt to boost the economy and end the banking depression the American President Franklin D Roosevelt decided to ban the purchase or sale of any gold that year, so the coins were minted but never released – except for 20. Which understandably, makes them worth significantly more than the face value or their weight in gold.
Although buying and selling collectors items is not without risk, there is at least a little more security and consistency when that collectors’ item is a gold coin.
All That Glitters Is Not Gold
Before you start hoarding the ‘Gold’ coins from around the world in the hopes of retiring early, be aware that not all so-called gold coins in modern currency are actually gold. Some, like the Australian $2 coin, have absolutely no gold at all https://en.wikipedia.org/wiki/Australian_two_dollar_coin and is actually a mix of Copper, Aluminum and Nickel. Despite this lack of actual gold, they are still commonly called ‘gold coins’ because of the color.
Of course, originally if a coin was gold colored, it did actually have gold. Not always 100%, but generally most golden currency coins were at least 90% 22 karat gold.
If you are looking to invest in gold coins for their collectors’ value rather than their value as a storage of gold bullion, then you will need to make sure that you do your research. Particularly for beginners into the coin collection game, as much of the time the value of a coin comes from its extreme rarity. However, it is quite easy to misunderstand exactly what it is that makes a coin so rare, and therefore can be easy for less than scrupulous (or even just ignorant) seller of sites like Ebay to mislead. For example, a gold coin minted and stamped in 1933 might be incredibly valuable, however a very, very, similar looking coin that was minted and stamped in 1932 might only be worth the weight of gold contained in the coin itself.
Reputable dealer should be able to explain why the coin is valuable, give previous sale prices for it, give an idea of how many similar coins are estimated to be in circulation and give an estimate of your coins anticipated value.