Investment Grade Coins - Pre 1933 Gold - Bullion | Goldco Direct

Investment Grade Coins

When it comes to precious metals, the opportunities vary from pure gold investments, influenced directly by the spot price, to highly speculative coins. When investing in precious metals, understanding the difference, and what affects their value, is foundational to building a profitable and secure portfolio.

  • Numismatic

    A numismatist is an expert in establishing the history and value of numismatic coins. The speculative end of the spectrum involves what collectors call numismatic coins. The “numismatic” value is the value of the coin above and beyond its associated metal’s weight value (spot price).

    The numismatic value is affected by such characteristics as age, condition, rarity, specific dates, mint locations, strike marks and historical significance. Though the line can be somewhat blurry, the collector value of these coins tends to drive the price rather than the precious metals content. Movements in the underlying metal price tend to have a minimal effect on these very rare coins.
  • Bullion

    This category includes rounds, bars and coins whose value corresponds directly with the market value (spot price) of its underlying metal, plus production costs (up to about 5%). This group of coins moves in direct proportion with the spot price, with very rare exceptions.
  • Semi-numismatic or Investment Grade

    This sought after group of coins carries some numismatic value, but is also affected by the value of its underlying metal. The numismatic value tends to absorb short-term movements in metals, while the content of the coin influences its long-term value. Because of its strength as a precious metal investment coupled with its stability against volatility, these coins are preferred by many investors.

The purchase of very rare numismatic coins should be considered very cautiously and with the input of expert numismatists. Because of the speculative nature of these coins, it’s can be difficult for the average investor to accurately determine their values. These especially rare coins typically fall in the collectible category and therefore are not recommended to represent a large portion of investment portfolios.

Depending on the investor, there can be a place for bullion in a precious metals portfolio. However, because bullion moves in direct proportion with the spot price, it tends to fluctuate in value rapidly.

Semi-numismatic, or investment grade coins, on the other hand, often represent the bulk of one’s precious metals’ portfolio. This is especially true in portfolios dedicated to long-term investments focused on sustained growth and protection.

Investment grade coins are preferred for portfolios because of their tendency to move with overall market trends without being heavily affected by short-term volatility. As a result, increases in gold’s price tend to gently push investment grade coin prices upwards. However, as dips occur in the price of gold, these coins show resilience as they tend to glide over such valleys.

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