Which is the best Gold Bullion Coin to Invest in ? - The Alternative View
As we say, we are often asked our opinion as to which is the best Gold Bullion coin to invest in. Generally, coin and bullion dealers will advise you on this, based on the 'premiums' paid over the intrinsic gold value of the coin. This theory then works on the principle that 'the lower the premium paid - the better value of the investment'.
The 'KRUGERRAND' Theory
Working on the principle as outlined above, this usually dictates that most buyers will be pointed towards Krugerrands, as that particular coin attracts the lowest premium with it being a pure gold investment vehicle. However, at Weighton Coin Wonders, we are not advocates of the 'Krugerrand' theory as we have called it, as there is one major drawback - which is where our theory comes in !
The 'FULL VALUE' or 'Weighton Coin Wonders' Theory
TThe vast majority of gold coins are (or have been) legal tender coins in their respective countries and therefore hold a denomination or monetary value - eg
1oz Britannia = £100
1oz Gold USA Eagle - $50
1oz Austria Philharmonic - 100 Euro
The monetary value of the coin is usually backed by a Government guarantee to pay the barer the 'monetary' value of the coin on presentation for redemption. This then, in effect, gives any coin with a monetary value two 'hedge' options - either the monetary value of the coin, or the intrinsic Gold value of the coin - whichever is the greatest.
The 'FULL VALUE' theory is based on the fact that a Krugerrand has NO denomination or monetary value.
Although at present, you would not dream of presenting the bank of England with a £100 1oz Gold Britannia to receive £100 face value, when the coins current intrinsic value is around £330.00 - but what if the gold market collapsed ?
It is very unlikely that the Gold intrinsic value of a coin will be worth less than the denomination value, but if the Gold market was to collapse it is possible. Theorists would no doubt argue that if the Gold Market collapsed, it would wipe out Governments and therefore make most currencies worthless (then what good would monetary value be?). However, it is well documented that many Governments are becoming less reliant on Gold reserves, and are in fact selling off vast quantities of their Gold reserves.
I guess what we are really saying here is related to good financial planning -
Is it better to have 2 possible GOOD outcomes, or are you happy to hedge your bets on just one ?
For this reason we generally recommend Gold bullion coins with a monetary value, and if you care to work it out, based on our theory, the best coin to purchase on the 'Weighton Coin Wonders' theory is the
UK BRITANNIA
NOTE: We are reliably informed that depending on market variants, there are some coins that actually have a higher monetary value than thier intrinsic gold value - some Japanese coins, and the Panama Balboa being good examples of this.
Interested in buying Gold Bullion coins - why not see what we have in stock and visit our e-shop at www.weightoncoin.com
or use this direct link to the Gold Coins section.
PO Box 70, Market Weighton, YORK. YO43 3WR
Please feel free also to phone on
01430 879060 / 07905 467650
or email to enquiries@weightoncoin.com
We can then assist you in person - ask for Richard