Whether you’re an experienced collector or a new investor, you might wonder about the difference between bullion coins vs. collectible coins. Despite their variances, they each possess precious metals and monetary value. In 2020, is it worth collecting gold coins or silver collectibles?
Gold and silver have been integral spokes in the wheel of modern civilisation — from early trading to current investments to coin collecting. Throughout history, the overall value of these metals as a means to buy and trade hasn’t weakened. In fact, coins and medallions date back to 600 B.C. as the first forms of metal currency.
Gold and silver are simply metals, but they are available in various forms, including rounds, coins and bars. Which takes us back to the topic at hand: what’s the difference between bullion coins vs. collectible coins?
One has a standardised and regulated metal composition, while the other retains historical and cultural significance. Ultimately, your investment depends on which style of coins you favour most, so read on for our two cents!
Bullion is any chunk of investment metal. You can find bullion rounds, bars and coins, but each form contains precious metals. Most investors start with bullion coins, but even as their stocks increase, the commodity remains valuable. However, bullion coins are strictly for investment purposes; not for use as general currency.
Of course, investors can trade and exchange these coins for actual currency, but you won’t be able to pay for a pint at a pub with a bullion coin.
If you can’t spend them, what is the bullion value of coins? The appeal is that they’re easy to collect, store, and transport. See, every bullion coin is weighted according to government-imposed standards for composition, and purity.
The Australian government mints bullion coins, ensuring the market remains equitable and authenticated. Why would this be important to investors?
In case of emergency (survival during a natural disaster, etc.)
For inflation hedge in the event of diminished currency value
Bullion coins are primarily for investing, although some limited edition releases can be collectibles.
Generally, investors choose bullion coins that contribute all three of the above factors. The most popular bullion coins include:
U.S. Silver Eagles
Canadian Silver Maples
U.S. Gold Eagles
Canadian Gold Maples
South African Krugerrands
90 Per Cent Junk Silver Bullion — silver coins before 1965, including half-dollars, dimes, and quarters.
While these are popular investment coins, collectible coins are different in that they have historical significance and value. Collectible coins are called numismatic coins, which we’ll cover in further detail next.
Collectible coins are called numismatic because collector’s pay premium prices for them.
A key difference between bullion coins vs. collectible coins is production. Bullion coins are released every year, whereas numismatic coins are no longer produced, making them hot collectibles.
Another key differentiation is value. The biggest asset to bullion coins is their precious metal contents. Collectibles, on the other hand, are desirable for their rarity. They aren’t necessarily used for investment purposes, but novelty. You might be surprised to learn that some numismatic coins are more valuable than bullion coins.
That’s because collectible coins can’t be reproduced, making the originals rare. Unfortunately, this means you won’t have the same government protections when purchasing numismatic coins. There are general market rules, but some dealers try to cheat inexperienced buyers into paying more money for less than desirable collectible coins. Savvy investors need to research the market value of the precious metals in the coin, as well as the rarity of the coin itself, before investing.
Fortunately, some collectible coins are widely available, making their value more universally known.
Swiss 20 Francs
Peace Silver Dollars
German 20 Marks
Pre World War 1 Coins
The fantastic feature of collectible coins is that they date back to antiquity. And even more interesting is that modern coins may contain ancient gold or silver from Egyptian times. In other words: metals never die, so they continue to create new value and life.
Investing in coins, whether bullion or collectibles, opens the door to the past and creates modern value. In fact, there are an estimated 160,000 tons of average gold holdings per capita, and that’s only what’s reported.
Collecting and investing in coins is a personal matter, so have you decided which investment is right for you?
The value of collectible coins fluctuates with the market and the times. For example, pre-WW1 coins will hold a higher value than some modern European coins. The best way to flesh out a valuable coin collection is to diversify your investments.
Seasoned collectors will buy modern bullion coins and collectible coins to build a well-rounded portfolio — this ensures that whatever happens culturally or nationally, you’ve got options for trading or selling.
Ultimately, the better investment depends on your preferences. Do you want historically significant coins in your possession? Then collectible coins are likely the investment avenue for you. Conversely, if you’re looking to secure a trusted investment to endure the peaks and valleys of inflation and economic uncertainty, bullions are a smart investment.
Let’s recap the differences between bullion coins vs. collectible coins.
Bullion coins are a safe investment that secures financial longevity.
Collectible coins are a historical relic that callback to a bygone era.
Bullion coins are federally minted and regulated to safeguard their purity and value.
Collectible coins run the gamut for gold or silver purity, but can exceed the value of bullion coins, thanks to their rarity.
Bullion coins will fluctuate with the live gold and silver spot values, whereas collectible coin value hinges on historical relevance, rarity, or cultural significance.
Choosing between bullion coins vs. collectible coins is entirely personal. We’ve outlined the key differences between the two, but they do share one common trait: both coins are an investor’s asset, whether historical or monetary.
Are you interested in investing in gold and silver coins? Browse our collection of numismatic and bullion coins to start building your investment portfolio today!
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