Should You Buy Gold Coins or Bars?
The gold market is dominated by gold bullion bars and gold coins. If you are new to the market or investing in gold, it can be quite confusing to see all the ranges of options available. With so many brands names, weights and purities it can call into question if you are making a right decision.
One of those major questions that nearly all gold buyers ask is should I buy Gold Coins or Gold Bars?
That's why we have put together this simple guide to clear out some of the confusion you may have around this question.
The Difference Between Gold Coins & Bars
The bottom line is that gold is gold.
Gold is defined as a yellow precious metal with a chemical element of atomic number 79.
Now a gold bar is usually made by taking gold in its raw form and refining it to a specific purity and weight. This categorisation of weight and purity creates the value that the market places on the different kinds of bars.
In the case of coins, they are very similar, apart from that they generally have an extra premium attached to them.That is because in numerous cases they can be used as legal tender, which has other benefits we will share later . People may also be sentimental about the historical value that a coin may hold or represent. A lot of coins that traders buy and sell may well have previously been used in circulation as currency.
When You Should Think About Buying Gold Bars
Gold bars tend to be better when you don’t care so much about the sentimental value of the gold and want to keep premiums on your investment down to a minimum.
Even though gold coins and bars will contain exactly the same amount and purity of gold when bought at an equal weight, because the bars are more commoditised you can save up to 1% of the total purchase value. Which when looked at on large numbers can be quite a big difference.
Additionally if you are making large purchases of gold then bars can offer you the most cost effective unit sizes. This is because bars can come in larger sizes which you can save on by purchasing in bulk.
When You Should Think About Buying Gold Coins
For a lot of first time and smaller investors gold coins can offer a perfect price point to get in at. Gold bars even in the lower sizes usually have a high minimum investment. Whereas the minimum investment threshold for gold bars starts nearly double that.
Another reason for choosing coins is that certain types like the Gold Britannia coins do not have any Capital Gains Tax on them. For this reason when realising larger profits from investments, certain sovereign coins can come out more valuable.
Where Can You Buy Coins Or Bars?
At Lebanor we offer a wide selection of bars and coins to cater for individuals and institutional investors needs.
