Certified Gold Coins
Posted by Adam King on December 23, 2009
As the recession lingers, the war in Afghanistan threatens to draw in more troops, and global terrorism and drug trade remain problems, the US dollar does not inspire global confidence. Thus many continue to invest in gold bullion and certified gold coins. Bullion prices are the price of gold set twice daily at the London gold fixing. The price of certified gold coins can be substantially higher than the price of gold. Historically certified gold coins outperform the mineral itself, both in times of economic uncertainty and long term as a hedge against inflation.
The grade of certified gold coins is determined by experts during the certification process. The grade or state of the coin is especially important as it is the rarity of the coin that determines its value above its price as gold bullion.
Certified gold coins are priced by rarity and by the coin’s popularity. Only a certain number of gold coins of each type were minted and many were melted down during the 1933 confiscation. Coins from a given era or by a particular designer, such as the Saint Gaudens double eagle minted from 1907 to 1933, may be more popular, raising their price beyond that dictated by their availability.
Availability, which is a function of rarity and popularity, also raises the price of certified gold coins. When everyone who owns a particular gold coin of a given grade and rarity wants to keep their investment, its scarcity drives up its price, even though there may be quite a few in existence. It is the number of certified gold coins that are available that sets the price, not the number put away in safety deposit boxes. In uncertain economic times like today, certified gold coins are not only a great investment but they are popular investments, making them highly desired commodities.
Stewart Lawson
Senior Staff Writer – Certified Gold Exchange
Categories:
US Gold Market