Investing in American Gold Coins
The economy everywhere has been greatly affected by global climate change, gasoline supply instability, political unrest and change of international policies amongst nations. Real estate firms fold up, import and export companies slowed down, insurances resold and banks merged. There is really no foolproof plan to shield businesses from recessions and economic hardship, a good investment today may be a thing of the past tomorrow, so investors are cautious now on how and where to invest their capital. One investment that does not rely solely on the economic growth is the gold business.
Gold is a kind of metal with the most malleable characteristics among metals because of its soft and dense features. It is often used for jewelry making, arts and coinage because of its luster and high value. No wonder people have been investing in Gold American Eagle coins for centuries.
The more gold component a coin has, the higher the value it can be traded at. Goldsmiths buy scraps of gold in the form of broken jewelries and melt them into bars to sell them to highest bidders or collectors. Another way to invest in gold is by collecting gold coins.
2011 1 oz Gold American Eagle – Click Here
Gold coins as money making venture
Gold coins that are rare, with high grade and in limited supply, tend to hold a high selling value for many years. An investor should start small by choosing the most profitable type of Gold buffalo coins. A coin that is dated older can fetch a good sum of money than the ones with later mint year. Since 1975, gold prices have steadily increased with a slight decrease in 1997 and 1998 but not enough to hurt investors on this kind. Take for example the American Buffalo coin also known as the gold buffalo with a face value of $50. It has a unique feature being the only coin minted with .9999% gold component. Even if it was just released for circulation in 2006, it has already reached a value of over $1000 in 2009. If you have acquired a hundred pieces of this coin and has sold them in 2009, you earned $100,000 in 3years time for a value of $5000 coins. That’s quite a lot of money for you there.
2010 1 oz Gold Buffalo – Click Here
Another coin with a high value is the Gold American Eagle coin or the official gold bullion of the United States of America .It is composed of 91.67% gold and 5.33% Cu. It was first minted in 1986 with proof and bullion editions. It has become an official bullion coin under the Gold Bullion Act of 1985. This coin has a $50 face value and sells at a total of $1650. So for comparison sake, if you have acquired a hundred pieces of the $50 eagle coins since 1986 and sold them this year, you will earn the sum of $165,000 for $5000 worth of coins. That’s $160,000 in profits you could have for 25 years collection. It seems quite small to compare it with the buffalo coins but still it yields profits.
Investing in coins differ from other investments in terms of:
1. Worth – gold coins are precious metals that increase in value as time goes by, the earlier you have acquired a rare coin, the higher value it will have later.
2. Ease of disposal and storage – coins are easy to store; it does not require a big warehouse and can be converted to cash easily without the trouble of packing, shipment and storage. It can be disposed of easily as it has collectible feature and has a high percentage to make a profit.
3. Usage – Coins have flexible usage, if it can be sold as is, it can be sold as ornaments or embellishment to other art collectors by way of melting them. Both ways of selling still yield good profits.
4. Diversity – gold investment can be in form of coins, jewelries, bars, biscuits and other gold embedded items. There are also gold exchange traded funds that can be sold in form of stocks, no risk in theft and misplacement.
5. Wear and tear – coins do not rot, rust or decay. Gold can be stored for decades or centuries.
6. Low investment – A small part of savings can be invested in gold. It does not require an office or employees to be able to start this business; the capital invested is solely for the amount of gold purchased.
Just like in any business, research and product knowledge is always a solid pre-requisite before risking your hard-earned money. Knowing the current market for gold coins will help an investor make better informed decisions. Study each coin that you acquire carefully and ask other coin collectors for the rare types that you should be looking out for. Then know how trends in the stock market affect the value of gold. Pinpoint the enterprises that may have a need of your collection. If you have good instincts on when to hold and when to dispose then the gold business may be the perfect money making venture for you. Perhaps you can finally say that there is really a pot of gold at the end of the rainbow.
