Tips For Buying Gold Bullion Coins - Safely!
When you decide to buy gold bullion coins, you are committing to a decision that may well have a very positive impact on the preservation of your future buying power.
But only if you actually pay a reasonable price! Too many novices, buying gold bullion coins for the first time, overpay & subsequently will have to wait a long time to see "the return of their investment" (Will Rogers!).
Gold Bullion coins, are coins whose value is based on their intrinsic metal value.
Not on any "coin collecting value" (in spite of what some dealers might try and persuade you!).
Normally they trade for a "premium over spot".
"Spot" is the price of the metal in the "spot" market and is widely reported on the financial channels, as well as daily in many news papers.
Some websites carry the graphs "live" (though often with a slight time delay).
Typically, bullion coins sell for a premium of up to 10% above "spot"- but this number varies depending on the type, quantity and size of bullion coins you decide to buy.
For example: First off, the type of coin: The premium above spot is generally lowest on Krugerrands.
For a one ounce gold bullion Krugerrand you should NEVER- pay more than a 10% premium above the spot price.
Ignore talk of "beautiful collectible coin".
This is a bullion coin pure & simple.
For half ounce coins the premium is greater; a half ounce gold bullion Krugerrand should have a maximum price above spot of 12%.
Again- that's it- don't be deceived! Next, quantity: If you order more gold bullion coins, you can expect a price closer to the spot price of the metal e.
g.
in the case of Gold Sovereigns, if you were to buy 100, expect to pay no more than 7% above spot.
Finally the size of the coin- the smaller coins tend to carry a higher premium above the spot price, as noted above in the Krugerrand example.
That's why I would always advise someone to save a little longer & try and buy a one ounce coin rather than buying two half ounce coins (or 10, tenth ounce coins...
).
The numbers I have quoted are designed to give you a sense of 'order of magnitude' of what to expect.
I get fed up of hearing stories of first time coin buyers paying DOUBLE what they should have.
So to summarize.
Buying gold bullion coins can be one of the best ways to preserve your wealth in these uncertain times- but only if you don't get overcharged at the outset.
Keep an eye on the gold price and do your sums.
Happy gold buying! Paul
But only if you actually pay a reasonable price! Too many novices, buying gold bullion coins for the first time, overpay & subsequently will have to wait a long time to see "the return of their investment" (Will Rogers!).
Gold Bullion coins, are coins whose value is based on their intrinsic metal value.
Not on any "coin collecting value" (in spite of what some dealers might try and persuade you!).
Normally they trade for a "premium over spot".
"Spot" is the price of the metal in the "spot" market and is widely reported on the financial channels, as well as daily in many news papers.
Some websites carry the graphs "live" (though often with a slight time delay).
Typically, bullion coins sell for a premium of up to 10% above "spot"- but this number varies depending on the type, quantity and size of bullion coins you decide to buy.
For example: First off, the type of coin: The premium above spot is generally lowest on Krugerrands.
For a one ounce gold bullion Krugerrand you should NEVER- pay more than a 10% premium above the spot price.
Ignore talk of "beautiful collectible coin".
This is a bullion coin pure & simple.
For half ounce coins the premium is greater; a half ounce gold bullion Krugerrand should have a maximum price above spot of 12%.
Again- that's it- don't be deceived! Next, quantity: If you order more gold bullion coins, you can expect a price closer to the spot price of the metal e.
g.
in the case of Gold Sovereigns, if you were to buy 100, expect to pay no more than 7% above spot.
Finally the size of the coin- the smaller coins tend to carry a higher premium above the spot price, as noted above in the Krugerrand example.
That's why I would always advise someone to save a little longer & try and buy a one ounce coin rather than buying two half ounce coins (or 10, tenth ounce coins...
).
The numbers I have quoted are designed to give you a sense of 'order of magnitude' of what to expect.
I get fed up of hearing stories of first time coin buyers paying DOUBLE what they should have.
So to summarize.
Buying gold bullion coins can be one of the best ways to preserve your wealth in these uncertain times- but only if you don't get overcharged at the outset.
Keep an eye on the gold price and do your sums.
Happy gold buying! Paul
