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 Replies: 14 / Views: 1,737 |
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Pillar of the Community
United States
2424 Posts |
I have been doing some reading and some research, and I was wondering what you all thought about investing in gold.
I have heard that buying up small "sovereigns" or old gold coins, will hold a higher premium than buying large bars or small bars.
I wonder if any of you buy gold coins for other reasons than just having the coin for your collection. I have some money coming in from taxes and was thinking of making a golf coin purchase for investment purposes and wondered what direction to go in. Thanks!
SD
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Pillar of the Community
United States
4867 Posts |
I would get the gold maple leaf coins from Canada. They are .9999 pure. I think that exceeds the American gold eagle.
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Pillar of the Community
United States
2541 Posts |
Well... it's the worst performing asset class since 1820 (even cash has outperformed).
There are 2 problems:
1) It's a commodity
2) No dividends or interest to reinvest. Compounding interest is your friend!
(I know I'll catch some flak this!)
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Bedrock of the Community
United States
12437 Posts |
If you are truly investing, i.e. attempting to maximize your ROR, then I would recommend avoiding physical gold and get a gold ETF or a pool account. If you just want some gold for diversification purposes, bullion coins are the most liquid while numismatic coins tend to hold a premium even if gold drops. |
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Pillar of the Community
United Kingdom
2838 Posts |
I agree with Gothic - Gold is not a good investment atm. Its 300% up over the last 5 years and this is only because people got burned in the stock market and in property.
If you like gold coins then buy them for that reason but otherwise keep away - don't believe the hype about 'gold never going down'. The exact same thing was said about top stocks and property just before both took a tumble.
Just like stocks and property gold will come down when the people in the know spot the next big thing and get out of the market at its over inflated peak leaving the average man to suffer the losses.
From an investment point of view you would be much safer with non-gold coins atm. Although having said that if you must invest in gold at least gold coins cover two markets and therefore have more security than gold alone.
Edited by bobbyhelmet
03/10/2010 3:49 pm
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Pillar of the Community
United States
3098 Posts |
Quote:
Well... it's the worst performing asset class since 1820 (even cash has outperformed). Quite interestingly, it is right. (unless if you kept banknotes - har har) I really think that even with the inflation that's going to come and the doomsday predictions and whatnot with the dollar, just the stock market itself should perform better than gold. Also, gold in itself is more of a precious metal, not a commodity one. There's not many applications for it other than jewelry. There's some industrial use, but the amount (by how much is mined and what percent is used per year) doesn't hold a candle up to other metals such as copper and silver. |
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Bedrock of the Community
United States
14454 Posts |
if you are going to invest in gold I think coins would be better and more liquid than bars because the purity is known and guaranteed
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Valued Member
United States
133 Posts |
if your going to invest in gold I would just buy Bullion and not pay the high premiums on the eagles and maples....
I would however invest in silver first. if you look silver is the better ivestment % wise. I've been investing in silver over the last year and so far its paid off. gold has paid off too but %wise silver has gone up way more....
theres other metals too. pallidium, rhodium, and platinum.
i would invest in silver first. its cheaper and has a better return.
its always easier to sell a $20 round then a $1200 round.
if the dollar does fail silver is better to have
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Pillar of the Community
 United States
2424 Posts |
i had thought about silver. however atm, I cant seem to find much roll hunting. I heard that older gold coins have that premium because of their numismatic value? also if the market does go down, so do the bullion prices with it. whereas the older coins will hold their value more?
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Valued Member
United States
183 Posts |
Here is a great article I read on silver and its many industrial uses. Silver is not just limited to being a precious metal. It has the highest conductivity of any metal known to man and it is the most reflective metal. Silver will out perform gold in the long run. Gold is the item everyone is running to right now, so common sense tells me I should look somewhere else. Make sure you read part 1 & 2. http://www.thestreet.com/story/1069...-part-1.htmlAlso for a small time investor like you and me silver just makes more sense. I would rather invest in 1200 War Nickels rather than hold just 1 oz of gold. |
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Bedrock of the Community
United States
10982 Posts |
Quote:
Well... it's the worst performing asset class since 1820 (even cash has outperformed).
How about silver? An ounce of silver was $1 in 1820 and an ounce of gold was $20 (in round numbers). But I digress. The price of gold was held artificially low until price controls were lifted in the 1970's. This was partly due to gold being tied to currency at gov't specified exchange rates. That said, it is a bit late in the game in invest in gold. I'd consider buying a bit but not go in heavy at current prices. |
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Pillar of the Community
United States
2541 Posts |
Despite what I have said about gold as just a pure commodity investment, there are certainly some 18th and 19th century gold coins that have done very well as investments based on their numismatic merits. As you all know some of the 18th and early 19th century gold coins had very low mintages and are very desirable to have in collections. That's probably what I'd be interested in if I were going to buy gold, but of course most of those are out of my price range.
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Pillar of the Community
United Kingdom
2838 Posts |
Just as an interesting fact only 160,000 tonnes of pure gold have ever been mined worldwide - if all of it was made into a single cube it would only measure 20m x 20m x 20m. Or to put it another way it could replace the water in two Olympic sized swimming pools! Although numismatic gold does carry a premium a coins worth is only its gold value plus the premium - if gold goes down then so does its overall value - the premium will remain unchanged apart from fluctuations in its appeal to collectors. With what seems to be boom bust in most world markets you would need to have pretty big balls to buy into the gold market now considering its 5 year trend. For the people who got in 5 years ago, even 2 years ago great, well done - not for us now though  I have read some very funny threads on other forums about people (strange people) investing in 'portable wealth' eg gold for when domesday comes and we all have to wander the wastelands like Vigo Mortensen in The Road. They don't seem to realise that if it does happen (it wont) demand for jewellery, coins and gold will be nil. Unless you can eat it or shoot it it will be worthless. If I had a bit of cash to invest I'd look at the Chinese Yuan and Chinese stocks. Just as the UK ruled the world in 1800s, the USA in the 1900s I think Chinas time is coming very soon. As the $, £ and Euro suffer the Yuan should still be strong. Another option would be the stocks of disgraced US and Europe banks. As much as I hate them they seem to have gotten off with plunging us all into recession and even though their stocks are rock bottom they will not be allowed to fail. They will simply pay the taxpayer back for the bailouts by charging us more to bank with them (great - we get to pay ourselves back!). Once they are re-regulated and fully recovered their stocks will rise again. Personally I'd rather burn them to the ground and shoot most of the bankers than invest but hey - this is how the world seems to work. Rant over. |
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Pillar of the Community
United States
2661 Posts |
I would buy collectible gold coins. I feel that the metals market is in a bubble and that it will eventually burst within the next two years. Just like the recent housing bust, the 1999-2000 tech bust and the metals bust of the early 80's. At least with classic gold coin, the numismatic market will more than likely still be there and value should modestly increase over time.
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Valued Member
United States
312 Posts |
With the Gold standard up and down by as much as a couple hundred an ounce, I would say how brave are you to take the risk?
Currently(as in right this second) Gold American Buffalo is at $1176.50, and the Gold American Eagle is $1166.20. 1 oz. Bullion is at $1111.00.
A few weeks back bullion was down to $1052.00 an oz. Some people would get nervous about a decrease like that.
I love looking at gold coins, but would never buy any because they are way out of my range I could afford.
Silver, is another story. Though I might consider, someday, purchasing silver bars, for the most part my purchase of silver is in coinage, whether 90% content, 40% clads, or 1 oz bullion coins.
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Replies: 14 / Views: 1,737 |
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Posted 03/10/2010 2:31 pm
