Gold Sovereign Coins
The Gold Sovereign Coin is a British coin that is produced by the Royal Mint as a bullion coin and released for investors and collectors. With some designs being issued in limited numbers the coin attracts a lot of interest and is considered one of the standard ways in which investors can build a gold holding of their own. Steeped in history there are many examples of gold sovereigns in the UK including those that have been in circulation as well as bullion coins. Some issues are scarcer than others and can attract significant premiums due to their rarity. Buying these coins is widely regarded as a secure investment and, coupled with other forms of precious metals, offers a way to diversify a traditional investment portfolio to achieve a balance of paper and physical assets. When it comes to buying gold sovereign coins, Physical Gold has plenty of options for both investors and collectors including single investment opportunities of rare and collectable coins in addition to our gold bullion coins.
Used in general circulation until 1932, this is the most iconic of British coins, examples of which can be found dating back to its original issue in 1817 to the present day. The first coin was originally minted in 1489 and was called the English Gold Sovereign. Produced up until 1604, these historic pieces were largely produced as bullion but occasionally used in general circulation. The English Gold Sovereign is an extremely rare coin and was a much-revered coin during its day. Originally weighing half a troy ounce, King Henry VIII decreased the gold content from 23-carat to 22-carat. Dubbed ‘crown gold’ this revision became the gold standard by which both Britain and the U.S. has adhered to. The English sovereign was replaced by the Sovereign in 1817 following the Great Recoinage of 1816. Prior to this, the weight of sovereigns (as well as other coins) fluctuated dramatically. The Coin Act provided a strict technical specification for the new sovereign coins (and other coins) that remains in place today, though a small degree of adjustment was made following the adoption of decimalisation.
Mintage of SovereignsThe coins were minted exclusively in the UK between the period 1817 to 1917 when production was shared with mints in Canada, Australia and South Africa. In 1957 the coin’s production was returned exclusively to the Royal Mint until 2013 when a deal with Indian based manufacturers, MMTC-PAMP, took over some of the mintage. The techniques used at MMTC-PAMP are identical to the Welsh-based Royal Mint but the coins produced overseas bear a special ‘I’ mark to distinguish them from British produced sovereigns. Over the years, many designs have been issued as well as several variations including the half, double and quintuple sovereign.
2020 Full and Half Gold SovereignsApart from 34 individual years, the gold sovereign coin has been produced annually with 2020 being the most recent example. Produced solely for the investment and collector’s market, the 2020 edition features the fifth portrait of Queen Elizabeth II by Jodie Kidd. The sovereign’s George and Dragon design on the reverse has been in place for over 200 years, this coin is a perfect partner coin to the Gold Britannia. The 2020 Gold Half Sovereign, the diminutive cousin of the full sovereign offers a lower price entry point for more modest investments whilst offering the same degree of liquidity and diversity offered by coins over bars.
Gold Sovereigns as an investment opportunityDue to its long history of mintage, the Gold Sovereign is available in plentiful supply and presents an attractive investment opportunity for inclusion in a precious metals portfolio. Though the price per gram is slightly higher than other larger gold coins, like the Britannia, the Sovereign can be viewed as an excellent entry opportunity into the precious metals market. Here, we shall explore the reasons why.
A wide variety of SovereignsWe have already established that the Sovereign is a great starting point for gold investors, due to its smaller size and affordability. However, an even more compelling reason to invest in this coin is its variety. The variety of these coins can, of course, be attributed to its long history of mintage. This factor coupled with the choice of monarchs creates an infallible investment opportunity. One of the easiest ways to start is to get hold of Sovereigns that feature our current Queens, Elizabeth II on its obverse. But there is a large market for previous monarchs. Modern Sovereigns that were minted from 1817 onwards feature the images of Queen Victoria, Edward VII, his son King George the fifth and our current Queen’s father – King George VI. There are different types of designs available in Sovereigns, issued during the reign of each monarch. The variety is breath-taking. For example, the reign of Queen Victoria itself produced Sovereigns that portray the young head, Jubilee head and old head. Such variety is unmatched in any other gold coin across the world.
Divisibility is the keyDivisibility is an overlooked, but significant factor in gold investing and portfolio planning. It’s really the main reason behind the preference of investors to buy gold coins, rather than bars. Since gold is capable of unlocking tremendous value in the long run, it is highly advantageous to hold small bits of it in the form of coins. This allows you the freedom to drip feed your coins into the secondary market, taking advantage of various price points at the time of selling. Buy gold sovereigns and receive four times the divisibility, in comparison to other popular gold coins like the Britannia. So, if you’re looking to create a purchase in the range of £2000 to £5000, the Sovereign would be the coin of choice.
LiquidityThe success of any investment can be measured by the returns it can bring. If owners cannot sell it, the very purpose of investment is defeated. The Sovereign enjoys global liquidity, as a highly sought-after British coin. The coin enjoys popularity and instant recognition all over the world, due to its long history. It can literally be sold within a few hours. The sovereign also enjoys the additional advantage of easy availability due to its massive ‘pre-owned’ market.
Sovereigns as a tax-efficient investmentSince Sovereigns are minted with investment-grade gold, they are VAT free in the UK. Likewise, they also enjoy a capital gains tax-free status, since they are legal tender in the UK. The tax saving component makes Sovereigns highly attractive to investors.
Watch our Video, "5 Reasons to buy gold sovereigns"