Investors are sometimes scared away from the rare coin market because of talk about dates, technical jargon (“What in the world is ‘numismatic?’“ is one I hear often), and the fear that some marketers build in people that “rare coins are not as liquid as the coins WE have, and the premiums are much too high on rare investment-grade coins.” The fact of the matter is that not all investors should buy rare gold coins for their portfolio, and some misguided individuals have lost a bundle by buying rare coins when they should have stuck with bullion.

However, there is a certain demographic that historically does better when they buy rare gold coins instead of gold bullion products. Before we talk about that demographic, though, we should discuss the term “rare” in reference to gold coin investing. A rare coin that collectors look for is different than a rare coin that investors look for, because rare dates and special mintages are more for the collector side of the market. An investment-grade rare coin tracks the price of gold bullion and moves in the same direction as the gold market spot price (found at www.COMEX.com), and the worth of a rare coin also tends to grow over time because it is an antique that is no longer produced.

Rare gold coins have higher cost association than regular bullion, and these costs tend to be overcome within the first 14 months of the holding period. Once the “break even” point is reached, certified rare gold coins tend to outperform raw bullion products anywhere from 1.38:1 to 4.57:1. Therefore, if you are looking for long-term safety then buying rare gold coins is probably going to end up better for you than buying bullion bars or coins. For more information on the risks and benefits of gold bullion and certified rare gold coins, stay tuned to this blog or contact us directly for the answers you seek.

Shawn Penny