Have you considered investing in gold bullion? This form of investment is still one of the most profitable to make, as it provides an inflation hedge and protection against financial crises.
Physical gold is portable, liquid, and valuable, available in the form of coins, rounds, bars, and fractional bullion. Each form has its own benefits and drawbacks, which investors need to consider before making a purchase. According to many, bullion coins are the best form of gold ownership, whereas others prefer the portability and ease of storage of bars.
There are numerous online reviews of precious metal investing companies, such as JM Bullion review, discussing their services.
Here is everything you need to know about gold bullion.
Gold coins are among the most popular types of bullion whose cost is just above the momentary spot price of this commodity. The current price per ounce is $1,792. Nevertheless, investors should make a difference between proofs and ordinary coins. The former refers to rare, special coins minted in a limited number for collectors. The coin imagery is remarkably sharp and clear, given every single detail is fully stamped into the metal.
Since proofs have become amazingly appealing to collectors, the majority of mints have started frosting their proofs to make them easier for identification. Bullion coins are highly liquid and ideal for first-time buyers looking for small investments. Their visual appeal makes them perfect for gift-giving or private displays. They are also likely to increase in collectible value over time.
Moreover, gold coins are minted by a limited number of national mints around the globe. The most popular variants include the Gold Canadian Maple Leaf, the American Eagle, and American Buffalo Gold Bullion Coin, The Australian Kangaroo, the Chinese Panda, the South African Krugerrand, and the Austrian Vienna Philharmonic.
The content, weight, and purity of each of them are guaranteed by the national mint in charge of their production. They are available in various sizes, starting from 1/20 ounce to one ounce, except for the American Buffalo, which is only available in a size of one ounce. For instance, the South African Krugerrand is minted by the South African government. The production commenced back in 1967, and it’s mainly symbolic.
The Canadian Maple Leaf was first introduced in 1979. The purity of this gold coin is guaranteed by the Canadian government, and it’s considered the nation’s official gold bullion coin. Walter Ott should be recognized for his efforts of introducing it as an alternative to the South African variant. In contrast, the American Eagle Bullion coins are still considered an excellent way for diversifying one’s portfolio by adding precious metals.
Another popular choice is the Austrian Vienna Philharmonic, which was first introduced in 1989. It keeps on setting sales records over the past few decades. Learn more about the history, design, mintage figures, and variations of the Vienna Philharmonic.
Gold rounds have no monetary value, and these are produced by private companies that wish to offer gold sale in a portable format but aren’t allowed to issue coinage. The design of rounds is beautiful, and their purity includes 18 carats, 22 carats, 24 carats, etc. In terms of weight, they are available in all weights, from rounds of 1/10 ounce to one ounce rounds.
Another type of gold bullion is the bars, which allows investors to purchase this commodity in bulk. They are excellent for bulk purchases because of the lowest premium over spot price. Bars are portable, private, and easy to stack. Their size and weight vary, ranging from as little as one gram to as large as 400 ounces. The premium is directly related to the size of bars, as larger bars tend to have a smaller premium.
Nevertheless, investors are encouraged to purchase bars of smaller sizes. There are multiple reasons for investing in smaller bars, such as having more potential buyers, lower counterfeiting risk, an assay requirement, etc. Probably the only drawback is the high premium.
Investors have to be cautious when buying gold bars, as only reputable ones have a recognized hallmark and proper stamping. A reputable bar is supposed to have its purity, weight, registration number, and refiner stamped on it. Established hallmarks stand for the brands of gold bars, referring to the manufacturers or refiners responsible for minting the bars. Look for well-known hallmarks in order to avoid difficulties when you decide to sell them one day.
If considering an investment in gold bars, you should purchase them from reputable dealers only. These dealers should have positive customer ratings and offer buyback policies. Bullion sellers must have a stellar rating and educative websites. Making a purchase from a larger dealer is always a better idea, as smaller dealers have a more limited product selection.
Moreover, a buyback policy is necessary to ensure dealers will repurchase the bullion you bought from them. Also, dealers offering buyback policies have a tendency to offer the most attractive resale prices to customers who have made purchases from them.
When comparing dealers, investors should take a couple of factors into account, such as shipping, insurance, commission, and credit card expenses. The cost isn’t the single most important factor, as most investors appreciate prompt delivery, excellent customer service, and a buyback policy. First-time buyers are advised to make purchases from two separate dealers and use them as sources for purchases in the future.
Fractional bullion is another form of gold investment to consider. This bullion form combines the benefits of bars and coins into a single product. Bar segments can be easily broken off to provide maximum liquidity.
On the negative side, when segments are sold, the value of the remaining piece is challenging to calculate due to its weight, which is non-standard. Also, after the division, investors face more difficulties in keeping track of fragments.
The bottom line
Whichever form you choose is up to you.
All of them provide long-term wealth preservation, outlasting any future currency!