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Is It Best to Buy Gold Bars or Gold Coins?

Is It Best to Buy Gold Bars or Gold Coins?

Is It Best to Buy Gold Bars or Gold Coins?

Buying gold as an investment is a very different experience to buying gold as an item of jewellery.  Whilst the incredible lustre of the metal can still be enchanting, beauty is not the primary reason for buying the item.

It is an investment in future profit and a hedge against instability. With this in mind, it's worth turning to the specialist bullion dealers, such as the Gold Bullion Company when attempting to answer the question “Is it best to buy gold bars or gold coins?”

Should I Buy Gold Bars or Gold Coins?

Gold bars take up less space than the equivalent weight of gold coins.  Gold coins will also be more expensive due to the cost of production of the more elaborate product. So, if you are buying purely for the value of a certain weight of gold, you are likely to see a higher profit margin from gold bars than from the same weight in coins.

Whilst some coins, particularly rare examples, will gain more in value due to their collectability, the additional desirability to collectors is not something that can usually be predicted at the time of the initial production run.

Are Gold Coins Easier to Sell than Gold Bullion?

The honest answer is no.  Gold bullion and gold coins are both easy to cash in for their weight value.  However,  it is worth considering that coins typically weigh less than bullion, meaning that if your investment is spread across a number of coins, it is easier to sell a portion of your assets in gold coin than it is in the form of large gold bars.  However, if you are buying a 1-ounce bar of gold or a coin that weighs 1 ounce, the difference comes down solely to aesthetics.

Are Gold Coins Legal Tender?

In the UK, certain gold coins, such as the Sovereign and the Britannia are legal tender.  However, this is largely an academic distinction, as the true value of the metal far outstrips the face value.

The Britannia gold coin, for instance, has a face value of £100.  This means that in an emergency, you could use the coin to settle debts.  However, as the price of 1 ounce of gold has not been below the £100 level in over 40 years, it makes little sense to use a gold coin in this manner.

Buying gold coins is largely an aesthetic choice, although there is, of course, the guarantee of the face value of certain gold coins, should something catastrophic befall the gold market. It is ultimately an issue of personal choice as to whether you buy gold coins or gold bars.