With all of the recent turmoil in the global stock markets, it is no secret that we are living 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 has enjoyed a bumper year with prices recently hitting $1000 an ounce as investors buy up stocks. 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.
So, what factors should you consider when buying gold coins as an investment?
The main factor is to compare the percentage over the standard market gold price for each type of coin.
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.. They tend to be better known than say, Krugerrand coins and, if you live in the UK have the added advantage of being exempt from Capital Gains Tax. 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 are the best known of all the modern gold bullion coins. Made from one ounce of solid gold, they are generally the most available and best priced coins of their type on the market. 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.