Mints in different countries periodically issue coins that are not put into circulation, and they are intended for investment. For example, Equatorial Guinea issued a silver coin called “Crystal Skull”, the Republic of Palau has “Laughing Buddha” and “Noah’s Ark” in Armenia.
What is the cost of investment coins, what are they made of, how to choose them and why are they needed at all? Andrey Litvinov, a market expert and director of the Golden Coin House, tells.
How much does an investment coin cost?
The price of these coins changes depending on how the price of the metal changes on the exchange. You add a small margin to the metal quote on the exchange and you know the price of the coin. Coin pricing is transparent and dealer prices are easy to compare.
As with ordinary coins that we pay in the store, investment coins also have a denomination minted, but its real value is many times higher.
For example, if you take the most common gold coin in Russia – “George the Victorious”, it is 7.78 grams of pure gold, and its face value is 50 rubles. You can take it to the store and buy a pack of cottage cheese, and by law you are required to accept it, it is in circulation, but its real market value is about 25 thousand rubles.
I bought such a coin in 2006 for 7 thousand rubles. Three times growth. What is this growth? Gold on world exchanges has risen in price, and the ruble is falling. Here the situation is, as the British say, “Win-Win”.
People buy such coins for investment purposes. For five thousand years of human existence, gold has been helping to save money, and I think it will help for another five thousand years.
In which coins is it more profitable to save funds?
It depends on your goals. If you want to go abroad, then most likely the most common investment coin in the world, the Vienna Philharmoniker, is 31 grams of the purest gold (0.9999 fineness).
In Russia, such a coin in 2018 cost about 80 thousand rubles, now it is about 100 thousand rubles. And such a coin is in circulation all over the world. You can come to America and sell it there.
And Russian investment coins somewhere in Europe may be unclaimed, and it will be quite difficult to sell them.
Also very popular are the Australian “Kangaroo” coins, the Canadian “Maple Leaves”, the American “Buffaloes”. These are the most widely used coins in the world. Well, and also the Chinese “Panda”, but to a lesser extent.
They have the lowest mark-up on the exchange price, so they will pay off faster when gold rises. Foreign investment coins are very beautiful, but if you are a patriot, take domestic ones.
The most popular domestic investment coin “George the Victorious”, with a face value of 50 rubles, contains 7.78 grams of gold. Such a coin is now worth about 25 thousand rubles.
This coin is minted by two mints, Moscow and St. Petersburg.
When buying coins from a private seller through bulletin boards, you risk losing money and health, it is better to buy coins from a bank or from a specialized dealer.
The coins produced at the St. Petersburg Mint are stained, and this is a famous problem. There was even a scandal with foreign buyers. The reason is poor quality chasing.
I assume that after each batch of coins, the mint should be washed in a special chemical solution and then dried. If the mint is chasing the plan and in a hurry, then they can disrupt the technology and microparticles of other metals get on the mint. That’s why they rust.
But it’s all hearsay. There are different versions of why this situation arises. The official position of Goznak or the St. Petersburg Mint is unknown to me personally.
What is better to choose: an investment coin or a gold bar?
I would recommend coins, because, unfortunately, bullion is counterfeited. For example, they insert tungsten rods into an ingot, and tungsten is the only metal that has a density similar to gold. True, this applies mainly to ingots of large weight – from 500 g.
With an investment coin, this is much more difficult to do. It is small, it is very problematic and economically unprofitable to drill holes and introduce foreign elements in it. In addition, the coins are made by high-tech stamping, which has clear parameters: diameter/thickness/weight, complex obverse and reverse design.
It is more profitable to fake rather rare old coins, because they have a very high numismatic component of the price.
And there is no point in counterfeiting investment coins. We have even been approached by representatives of the precious metal authenticity laboratory with a request to provide them with counterfeit coins so that they can study counterfeiting methods.
Technology for verifying the authenticity of gold and silver does not stand still. For example, we have devices that work on the principle of eddy current conduction. They allow you to determine with certainty whether there are foreign inclusions inside a gold or silver coin or bar.
Why buy precious metals if American stocks over the past 20-30 years have outperformed gold prices dozens of times?
Of course, there are assets that have risen in price more than gold. For example, Bitcoin took off like a rocket. But you do not take into account that profitability is a payment for the risk of investments, the risk of losses and loss of capital. In the gold option, the risks are minimal, and the possible return can be quite good.
If we are talking about money management in general, then it is useful to have various assets in the portfolio, including physical precious metals.
Isn’t it easier to invest in depersonalized metal bank accounts? Minimum spread and no need to store anything