Posts Tagged ‘gold bullion’
Types of US Mint Gold Coins
When people talk about types of gold coins, the word “type” can have a wide range of meanings. It may mean a U.S. coin or a foreign gold coin, or a rare gold coin versus a bullion coin. Or they may be talking about the specific design of a coin.
The broadest meaning of “types of gold coins” may be coins minted by the United States government or coins minted by foreign governments. Thanks to the size and depth of the U.S. market, the gold coins minted by the U.S. government are by far the most popular “types” of collector and investor coins in the world. Our nation’s pre-1933 gold coins, which were recalled and melted in the mid-1930s, are in great demand from domestic and international collectors and investors. Likewise, our government’s high-mintage post-1985 American Eagle gold bullion coins are the most popular gold bullion coins in the world.
More On Each Individual Gold Coin
1. Liberty $20 Gold Coin
2. St. Gaudens $20 Gold Coin
3. Eight Piece Gold Set
4. American Eagle Gold Bullion
Collecting by Type
Collectors may organize their coins by Type, which in this case means “design.” That means they seek to build a collection with one representative example (or more) of each design in their series. For example, if they collect U.S. $20 gold coins, they may have a basic collection of two coins: one representing the Liberty Head series minted from 1849 to 1907 and one coin from the Saint Gaudens Type minted from 1907 to 1933.
An advanced collection of $20 gold coins might also own all five Type coins representing the design changes within the series. This Type Set of U.S. $20 gold coins would include examples of the following five designs:
Liberty Head Type I Without “In God We Trust” 1849-1866
Liberty Head Type II “In God We Trust” on reverse 1866-1876
Liberty Head Type III Value expressed as “Twenty Dollars” 1877-1907
St. Gaudens Type I Without “In God We Trust,” 1907-1908
St. Gaudens Type II “In God We Trust” on reverse 1908-1933
Another kind of “Type” collection is composed of multiple denominations. A Type collector who is focused on U.S. gold coins might start with one representative coin of each of the following basic denominations: $1, $2.50, $5, $10, and $20. He might then expand the number of designs (Types) to include two examples of each denomination. The Liberty Head design was used on all of our gold coins in the second half of the 19th century and into the first decade of the 20th century. That’s when newly elected President Theodore “Teddy” Roosevelt ordered the designs of our nation’s gold coins to be updated. That’s why Type collectors now seek the Indian Head $2.50 and $5 and $10 gold coins, as well as the Striding Liberty $20 coins struck from 1907 or 1908 into the late-1920s or early 1930s.
A more advanced collector of U.S. Type gold would also add examples of the $1 (which had three distinct Types) and $3 gold coins. Unlike most other denominations in the U.S. gold coins series, the design of our nation’s $3 coins was unchanged throughout the 1854-1889 series.
There are many types of gold coins: U.S, foreign, rare, and bullion. There are even Types of gold coins within each denomination. Because they’re made of gold, all types of gold coins are highly desirable!
Gold Bullion Coins
Gold Bullion Coins come in many shapes and sizes, from as small as 1/25oz to as large as 220 pounds. The 220 pound coin was minted in Canada and is worth millions of dollars, however most gold coins that people buy are 1oz or smaller. Many countries have a mint at which they produce their own gold bullion coins. Here is a rough list of gold bullion coins:
American Eagle
Australia Kangaroo
Austria Koronas
Austria Ducats
Austria Vienna Philharmonic
Canada Maple Leaf
Chile Peso
Chinese Panda
Colombia Peso
England Britannia
French Franc
Holland guilders
Hungary Koronas
Isle of Man Angel
Isle of Man Persian Cats
Italy Lire
Mexico Pesos
South Africa Krugerrand
Swiss Franc
These coins range in gold purity. For example, the American Eagle is 22 carats which is 90% gold and 10% of another metal for durability. The coin still contains 1 ounce of pure gold. The Canadian Maple Leaf on the other hand is 24 carats. It is still 1 ounce of pure gold therefore it is a smaller sized coin than the Eagle because it does not contain any other metal. The sizes of gold bullion coins vary for this reason.
As you can imagine, every coin has a different design and some are more beautiful than others, but for the most part this makes no difference on the value. A gold bullion coins value is determined by how much gold it contains. Therefore any common issue coins do not carry any collector premium. If you own a 1oz American Eagle then it is worth the spot price of gold plus a premium depending on supply and demand, and the particular broker/dealer you are working with.
Bullion coins can be acquired in a self-directed Gold IRA. In certain instances they are reportable to the IRS upon the sale of them and they are considered to be subject to confiscation by the government. With all of the upward predictions for 2010 that are coming out these coins could be worth much more in the future.
Rare Gold Coins Outperform Gold Bullion
Gold has been in a positive trend since 1999. We have seen gold come from $252 per ounce in 1999 to as high as $1,225 per ounce at the end of 2009. Over that 10 year period is a 386% gain. Over an even longer period of time we have seen gold come from $35 per ounce in 1970 to that same $1,225 mark in 2009. That is a 3,400% increase! But what have rare gold coins done over that same time frame?
According to PCGS, Mint State Rare Gold Coins have performed even better that gold bullion since 1970. On their site, a $1,000 acquisition of mint state rare gold coins in 1970 would be worth $114,489 today. That is an 11,348% increase! That means that rare gold coins have outperformed gold bullion close to 4 to 1 over the past 40 years.
There are a few factors as to why this has occurred. Gold bullion only has the value of the gold content itself. If you own a 1 ounce gold bullion coin, like an American Eagle, then it is worth 1 ounce of gold. Rare gold coins also posses the intrinsic value of gold. A $20 Liberty minted between 1849 and 1907 contains one ounce of gold, so therefore it will never be worth less than the gold content itself. However, rare gold coins also have value do to their quality and rarity. However, the main factor that contributes to their value is supply and demand forces. No one can mint coins prior to 1933, therefore supply is limited. As demand heats up, supply becomes tighter and the value goes up. Gold bullion is being mined everyday, therefore supplies are constantly increasing.
Quality and rarity of any particular coin play a large role in its specific value. The higher the quality the more valuable it will be. The same goes for rarity, the more scarce a coin is the more valuable it will be. Rarity is easily determined. PCGS keeps a population count for every coin ever minted in the U.S. in every grade. PCGS has also made grading simple. PCGS and NGC grade coins on a scale from 1-70, 70 being perfect condition. Where you find the performance is in the mint state category, which runs from 60 to 70.
You can see that if you have a high grade mixed in addition to a very rare coin the value would be very high compared to a coin that is of a lower grade and rarity. In fact one coin, the 1933 $20 Saint Gaudens, which was at the time considered to be the only one in existence, sold at auction for $7.5 million. Values range from a few thousand dollars per coin up to that amazing $7.5 million value. Buy rare gold coins.