What are fractional gold coins?

The term fractional gold refers to coins that have less than one troy ounce of gold in them. Most numismatists will tell you that coin releases undertaken by large mints around the world include sizes that have less than one troy ounce of gold. The one exception may be the world-renowned Sovereign coin which weighs approximately a quarter of an ounce. Being a ‘full’ Sovereign, it tends not to be referred to as fractional.

When we think about it, it seems like an awfully small amount of gold. So, why should anyone want to invest in fractional gold? Are there any advantages or disadvantages? Why is fractional gold considered to be a hot investment category?

In this article, we will discuss the pros and cons related to buying fractional gold.

What type of fractional gold coins are available?

Most major precious metals mints will produce fractional versions of their flagship one ounce gold coin. Examples of well-known fractional coins from around the world are Krugerrands, Maple Leaf coins, Philharmonics, Eagles and Nuggets. Alongside the 1oz gold coin, there will usually be versions made in half ounce, quarter ounce and tenth ounce weights. Some mints even produce tiny 1/20 oz fractional gold coin. Usually, mintage volumes of fractional coins are far lower than the original 1oz version.

For UK investors seeking to be tax efficient and buy UK coins, there are a number of fractional UK gold coins available.

• Gold Britannia 1/2oz, 1/4oz, 1/10oz
• Gold Half Sovereign, Gold Quarter Sovereign
• Gold Queen’s Beasts 1/4oz
• Gold Tudor Beasts 1/4oz
• Gold Lunar 1/4oz, 1/10oz (limited)

Pros of investing in fractional gold

Its worth considering buying fractional gold coins  for several reasons. With gold’s popularity with retail investors growing each year, demand for smaller fractional coins is also increasing. Their many benefits appeal to smaller investors and collectors and mints have responded by producing more fractional coin varieties.

Price

Well, the simplest factor that comes to mind is, of course, the price of the gold. Needless to say, larger and heavier coins are way more expensive. If you’re a numismatist or a hobbyist, you may not want to commit very large sums of money while spending on building your collection. Fractional gold coins allow you to build a collection without breaking the bank.

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Ideal and affordable gifts

Buying gold for a loved one as a gift is becoming more popular as it’s a thoughtful gift which is aesthetically appealing and interesting. With one-ounce gold coins costing upwards of £1,600, these coins can prove too expensive for most gift buyers. The fractional gold coin versions offer the ideal affordable gift option for birthdays, Christmas and special events.

Building your own collection

Building your collection from scratch can be an absorbing experience. So, that’s all the more reason why you need to get more bang for the buck. Investing in fractional gold coins will mean that you’re buying your bullion in smaller sizes and can, therefore, acquire more for the same price. If you keep at it, over and over the years, your collection will grow and you could have a formidable gold coin collection.

Trading in your gold coins

Many collectors frequently sell a few gold coins for a bit of liquidity and cash flow. Fractional gold coins are ideal for this purpose, as it is possible to trade in them without selling off the more expensive coins from your collection. This is why some collectors like to invest in fractional gold coins.

Easy liquidity

Numismatists all over the world are constantly on the lookout for trading opportunities that can help them acquire better coins for their collections. In terms of liquidity, fractional gold coins are great as they offer good bartering opportunities, which is not always possible with gold coins that contain a higher amount of gold, with a larger value.

Cashing in on the higher demand for gold

As the price of gold rises, the value of your fractional gold coins is also likely to increase. As discussed earlier, fractional gold coins are typically cheaper to buy and so, investors looking to make quick returns from the price of gold would buy these coins when the price of gold falls. Later on, as the price rises, they can cash in these coins and get quick returns.

Hedging against the risk of economic uncertainty

Gold investors are always looking to hedge their risks in the event of a global economic crash. However, liquidity is also an important factor. In the event of a global economic meltdown, most investors would move to gold and the price of gold would rise swiftly, as it did in 2011. At a time like this, if an investor wants to free up some of their capital, fractional coins are ideal as they can be sold to raise funds for smaller purchases. Selling a large amount of gold is not always ideal as the investor may not want to liquidate large amounts of gold, when not required.

Disadvantages of investing in fractional gold coins

Although it might seem that

investing in fractional gold coins is a smart idea for investors, these investments also carry certain risks.

Higher mark-up price

As mints produce large amounts of gold coins, their setup cost for manufacturing these are typically more expensive when it comes to producing gold coins that contain less than an ounce of gold. Usually, 1-ounce gold coins are available at the best price. Therefore, fractional gold coins would always have a higher mark-up price when compared to other gold coins produced by the same mint.

Premium prices

Mints often charge mark-up’s that range between 9 to 15% on fractional gold coins. Many investors see this as an undesirable factor, as the mark-up is not recoverable when trading in the coins.

Talk to our gold experts before you buy fractional gold coins

At Physical Gold, our gold experts have many years of experience in being able to advise investors on products that are ideal for building a gold portfolio, while maximising the opportunity to invest at the best possible capital layout. Call us now on 020 7060 9992 or get in touch with us online to speak with a member of our team. We would always be happy to discuss your investment plans with you and advise you on the best products that suit your investment goals, no matter how small your requirement.

 

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If you’re going to invest in gold coins, you will need to ensure they are the genuine article, rather than fake. But how can you tell if a coin is nothing more than a convincing counterfeit? Here are eight techniques to help you avoid being scammed.

How Do I Detect Counterfeit Coins?

1)    Check gold and silver coins with a magnet

Anyone who knows a little about precious metals will already be familiar with the fact that gold and silver do not interact with magnetic forces. This means that a high quality, genuine coin should remain unmoved if exposed to a magnet.

If a coin that is claimed to have a high gold or silver content is attracted to a magnet, then it is likely a counterfeit that contains more steel or iron than advertised.

It’s worth remembering that for this reason, some counterfeiters use other non-magnetic metals like copper and lead. This means the magnet test should be carried out alongside the other techniques if it proves inconclusive.

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2)    Examine coins closely for visual imperfections

Even the best counterfeiters in the world make mistakes, and with a well-trained eye, you should be able to spot the difference between the real deal and a fake. This applies to counterfeits of mainstream coins as well as rare collectable coins for investment.

To do this most accurately, pick up a magnifying glass, or go a step further and invest in a specialised loupe used by jewellers to get a closer look at the surface.

If you don’t have a genuine coin to hand, find a high-resolution image of the coin online and use this to make your comparison.

3)    Weigh and measure coins

From modern silver Britannia coins to vintage gold half sovereigns, all high quality coins will have been struck consistently and only put into circulation if they adhere to strict standards for their dimensions and weight.

Because major mints are so reliable in these terms, spotting a fake coin is fairly easy. You just need a calliper and a set of electronic scales.

A standard set of kitchen scales will not offer sufficiently accurate measurements, so buy a scale that displays weights to at least two decimal places. Weigh the suspicious coin and if it is out of kilter with official figures by a significant margin, reject it.

Even a coin that is on the ball in terms of weight can still be a fake. By using a calliper to measure its depth and diameter, you will be able to spot any inconsistencies.

Counterfeiters find it almost impossible to create the perfect phoney coin which both weighs the same as the currency it is spoofing and also has the same dimensions. With the right kit, you can steer clear of dodgy deals.

4)    Stack suspicious coins

Another obvious sign that a coin is not of sound origin can be seen in the relief. Even small variations in the height of the relief can become apparent with a straightforward stacking test.

All you need to do is place the coin in a small stack with other examples of similar heritage. Real coins will stack neatly and remain stable, while fakes that are not struck with the same attention to detail or high-quality craftsmanship will teeter, totter and tumble over.

Identifying uneven relief height using this technique does require that you have access to real coins of the same age and denomination. This might limit its usefulness if you are new to investing in or collecting coins, but will help those who are expanding an existing hoard.

5)    Ping silver and gold coins

This technique is specific to gold and silver coins as a result of the properties of the metals and the noise that coins make when they collide with a hard surface.

Pinging is a straightforward test for valuable coins, as the sound produced by silver and gold as they hit a tabletop, or are struck against another coin, is unique. While coins made with lesser metals, including counterfeits, will sound dull when dropped, a genuine coin will ring out for longer and produce an unforgettable high-frequency sound.

Prepare yourself to scrutinise potential coin purchases by performing the ping test on a gold or silver coin you know to be genuine, or check audio examples online. That way you’ll have a fixed idea of what to listen out for later on.

6)    Place an ice cube on the coins

Gold is a great conductor of heat, silver even more so. That means as soon as an ice cube comes in contact with the surface of a gold or silver coin, it will begin to turn back into liquid water.

If a coin is made of a less conductive and less valuable metal, this process will not begin as quickly. Try this test out with genuine gold and collectable silver coins to see what the reaction should look like.

7)    Check the specific gravity of gold and silver coins

This is a far more technically advanced test than the others covered so far, which makes it a little harder to recommend to the average coin investor. However, arming yourself with as much knowledge as possible is always a good thing, so understanding the specific gravity test will be helpful for everyone.

The specific gravity of gold and silver will be unique and thus different from that of other metals. You can calculate the expected relative density of a coin made of a precious metal, then test it in real time using a set of scales, a container and some distilled water.

Weigh the coin, then fill the container with the water and place it on the scales, before resetting the measurement to zero. Tie a small length of thread around the coin and slowly place it into the water until it is entirely beneath the surface, but not touching the bottom of the container. Take a note of the weight that has been added and then divide it by the ‘dry’ weight of the coin you took earlier.

For gold, the specific gravity you are looking for is 19.3 for a completely pure sample. For silver, it’s 10.49.

8)    Work with respected silver and gold coin dealers

If you want to avoid all of the complications that come with trying to detect counterfeit coins under your own steam, the best option is to only buy from dealers that have a good reputation.

This isn’t just about avoiding first-hand contact with con artists, but also about building up a trusting relationship with a company like Physical Gold which you can rely on for all your future precious metal investment needs.

Most of all you should avoid coins that are being sold well below their market value, or being pushed upon you by a dealer who seems eager to get the sale over with as quickly as possible. The signals of an attempt to shift fake coins should be clear, so long as you are willing to look for them and don’t fall for a deal that’s too good to be true.

Call or email Physical Gold for more coin advice

Our experts know everything there is to know about gold and silver coins, such as Sovereigns and Britannias. So, if you are thinking about investing and want more information, then the best option is to get in touch. Make a quick phone call to 020 7060 9992 or email us for outstanding coin advice.

Image Credits: Pixabay, Pixabay, PickPik, Pix4Free and Pixabay.

How much is a Sovereign worth?

Victorian Gold Sovereign coins can make a wonderful gift or investment and are one of the most popular forms of physical gold.

But what are the Sovereigns worth?

With the price of gold moving steadily upwards over the years and money very tight for many of us, it could be time to dig out those coins we were handed down by our Grand Parents to raise some much-needed funds. If you’re lucky enough to have been given the coins, you’ll see why Sovereigns are such a good investment as the price has risen dramatically.

Do you own one of the 10 best British gold coins in history?

1. Underlying Gold Price

We always start deriving the value of a Victorian Gold Sovereign coin from the underlying gold price, known as the spot price. This price is generally quoted in various currencies in ounces and grammes and acts as a benchmark to value the various types of gold. The value of a Victorian Gold Sovereign will be at a premium or discount to this benchmark – with the first step being to multiply the ounce spot price by 0.2354 (which is the gold weight of a Sovereign coin in ounces). The underlying gold price values all gold-based coins including Gold Sovereigns as well as Gold Britannias.

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Click to discover the 10 rules you need to know to sell your Victorian Gold Sovereign at the highest price

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2. What sort of Victorian Gold Sovereign do I have?

It’s important to note that not all Victorian Sovereign coins are valued the same. 95% of them will likely fetch the same price regardless of the year of issue. However other factors to consider would be the condition of the coin, the year of issue and the rarity of the coin. For instance, there are 3 varieties of Victorian heads available, each of which may attract different collectors or buyers (Young Head, Jubilee Head, Old Head).

Why does this matter?

With Victorian holding the record for longest British female monarch, up until recently when Queen Elizabeth took her crown (sorry!), the Sovereigns issued during her extensive reign were updated twice. Obviously, the Young head portrait represents the early years of her reign when she was a young woman. Therefore they’re the oldest Victorian coins of the three and worth the most. Prices for young head coins can be around 15-20% than later portraits. These coins are also unique as they were produced in what’s called ‘coin alignment’ This means that the portrait side and reverse side are upside down to each other.

How about the later versions?

The jubilee head was the next version to be launched and encompasses the middle period of Victoria’s reign, including her golden jubilee. This portrait only lasted for 7 years (compared to the Young Head’s 17-year stint) so naturally, there were fewer coins minted. For this reason, you could argue that the Jubilee Head coin is rarer than the more expensive Young Head version. Perhaps this suggests that premiums on these could rise faster in the future. Certainly, the value varies quite a lot depending on general market supply. Sometimes, it trades at the same level as the newer Old Head coin, while other times it can command 5% higher prices than the Old Head. This coin also marked the very first Sovereign to be minted in ‘medal alignment’, whereby the obverse and reverse are printed the same way around. All Sovereign issues since have followed this format.

Old Head Victorian gold Sovereign value

The Old Head Victorian coin, also known as the veiled head due to the portrait featuring the monarch wearing a veil rather than a crown, is generally the least valuable of the three versions. It’s the most recent edition so has less history about it and there is a plentiful supply. Generally, we tend to see relatively stable premiums for these coins. Because of this, they can be a really good value way of adding Victorian Sovereigns to your gold investment collection without having to pay the high premiums of the rarer coins.

What else do I need to know?

Generally, the second-hand Sovereign market will provide a good price for Victorian Sovereigns as long as there isn’t visible damage to the coin or small pieces missing. Clearly, a coin of over 100 years in age isn’t expected to be in pristine condition. You may want to check whether your Victorian coin falls into the 5% of Sovereigns worth significantly more than others. If your coin is a shield back, then this could instantly demand a premium over regular coins. Years of low print runs (and therefore rarity) will also command a further premium.

Read our article on which gold Sovereign coins are the most valuable.

 

3. Mint Marks

Of course, sometimes the devil is in the detail. If you look closely at Victorian Sovereigns even of the same year and portrait, they’re not necessarily identical or command the same price. Their worth can also vary due to mint marks. These can be difficult to see but basically, a letter will depict which mint the coin was produced in. The Young Head and Jubilee Sovereigns were minted amongst three different factories, namely – London, Melbourne and Sydney. The Old Head coin added Perth Mint to the production list. Interestingly, this reflected Britain’s growing empire, with the Sovereigns to follow in the Edwardian and Georgian eras, also being minted as far afield as Canada, South Africa and India.

How can I benefit?

Depending on which branch mint the coin was made, certain coins can be worth more, depending on the quantity produced by each mint. For instance, while the various Australian mints produced Sovereign coins for between 30 and 50 years, Ottowa and Pretoria mints only produced for around a decade, with Bombay only minting during 1918!

Mint marks to look out for are London (L), Sydney (S), Melbourne (M), Perth (P), Ottowa (C), Bombay (I) and Pretoria (SA).

4. Timing

Exactly when you choose to sell or value your Victorian Sovereign will impact its value. We’ve already spoken about the underlying gold price, and how the worth of any gold bar or coin is calculated from that point first. Clearly selling your Gold Victorian Sovereign when the gold price is high will dramatically enhance the worth of your coin. But there are two other timing elements which play a role.

Market sentiment

The supply and demand dynamics of gold are fluid. In other words, there are times when supply is particularly tight, perhaps due to mine closures or investors hoarding their gold. Other times, we see plentiful supplies of even the more numismatic gold coins. Similarly, demand can fluctuate greatly. In particular, we experience the same theme time and again, that demand for gold rises when there’s economic or political unrest and then declines during periods of economic prosperity and global peace.

So how can I actually use this?

Intuition and common sense tell us one golden rule with investing. Buy low and sell high. Simple! However, with gold investing, retail buyers tend to buy gold as the price is rising or already high as they’re seeking a safe haven. When newspaper headlines feature stories of impending banking crises, Brexit disasters and world wars, retail investors buy gold coins and bars as security against possible stock market crashes and property price declines. Unfortunately, they’re buying at high prices as everyone else is also looking to purchase.

Conversely, when equity and property markets do well and political news is quiet, the gold price falls. When this happens, many investors sell their gold as they feel the bad times are over.  Again, the timing isn’t great as they’re selling at a low price.

But it gets worse because dealers will react to supply-demand dynamics, further amplifying the movement of the market. In other words, when everyone is selling, dealers will pay lower premiums for Victorian coins as there’s a spike in supply and fewer buyers in the market. When everyone is buying and very few offloading Victorian Sovereigns, premiums go up to reflect the difficulty in sourcing the coins.

Just like the smart money – think hedge funds and central banks, try to buy your gold sovereigns when the price is low and everyone else is selling. If you can, sell them when the market is high and everyone else is helping push up premiums.

Which price point to take

If you’re looking to sell your Victorian gold Sovereign, make sure you agree with the buyer if the price is fixed or set on either the live gold spot price or the LBMA gold fixing. On a volatile day with lots of economic news releases, the gold price can fluctuate considerably. The difference between fixing a price on the morning fix, afternoon fix or live spot price, can have a huge impact on the value of your Sovereign.

Watch our YouTube video and then decide – “Gold Britannias or Gold Sovereigns – which is the best investment?”

5. Who you sell to

Is my coin worth a premium or discount to the spot price?

If your coin is deemed to hold a numismatic value due to the year of issue or design (a value over and above simply the gold content), then it will undoubtedly fetch a premium to the spot price, in some cases up to 75% more. Otherwise, the value of the coin will depend on who you eventually sell to, and the current state and volatility of the gold market.

Selling to ‘Cash For Gold’ sites or a jeweller will undoubtedly achieve the largest discount to the benchmark (the lowest price) as these buyers will seek to melt down the gold and profit from your sale. However, this route may offer the convenience of simply dropping in the coin locally.

Selling to a collector may achieve a high premium as an individual may need your coin to complete a collection. However, you may be waiting for years to find the ‘right’ collector and you also expose yourself to the danger of dealing with the public or small unknown intermediaries.

Selling to a gold dealer should achieve a value close to the spot price while offering both convenience and safety. These coins are tax free in the UK which means gold dealer’s specialising in gold investment have a great need for these coins.  Indeed, at the moment supplies of second-hand Sovereigns are particularly tight due to the demand for physical gold, meaning that the brand-new gold Sovereign coins are better valued than old ones.

 If you were handed the coin many years ago, you may be delighted to know that a coin worth around £20 when it was given to you 10 years or more ago may be worth more than £400 now.

King George V sovereigns are highly valued amongst numismatics due to being the last gold sovereign in actual circulation before the end of the Gold Standard in Britain. Over the years gold sovereigns have become a standout investment for collectors as they not only represent a significant part of British History but are also considered legal tender in the UK. This means they are Capital Gains Tax exempt.

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You may know your stuff with George Sovereigns, but our Insiders Guide covers gold investment as a whole. Download Now

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Why do King George V Sovereigns make a good investment?

Gold sovereigns are one of the finest examples of British craftmanship, a symbol of a time when the British Empire was still considered great. George V was one of the country’s most popular monarchs and reigned during a time of great change, not just in Britain but throughout the world. His time on the throne saw the rise of new political movements such as socialism, communism and fascism, however, the advent of World War I in 1914 would have the biggest impact on his reign.

Up until the first world war, gold sovereigns were still a major part of everyday life. Just days after the start of the war in August 1914, however, people were urged to donate their gold coins. Sovereigns continued to be mined overseas but this period marked the end of an era for what had been one of the most important coins in British History. After the gold standard was abolished, there was less of a need for gold sovereigns and so the number of coins being minted started to go into decline.

Gold Britannias or Gold Sovereigns – which is the best investment? – a Physical Gold Video

It was under George V that the final two branch mints would be opened, one in India and one in South Africa. George V Sovereigns are the only coins to have been produced in six branches of the Royal Mint.

Gold sovereigns are considered semi numismatics. This means collectors buy them for both their bullion content as well as their numismatic (rarity/historical value) Due to the coins everlasting popularity with collectors from all over the globe, gold sovereigns are relatively liquid which means they are easily exchangeable for cash.

The 1917 George V Sovereign

The 1917 George V gold sovereign is considered incredibly rare and is highly sought after by many coin collectors. This is due to many of them being melted down after World War I in a bid to help pay off Britain’s war debts to America.

The Ottawa Mint

The branch mint in Ottawa ceased all production of gold sovereigns during George V reign. Gold sovereigns produced at the mint up until 1919, when it closed for good, are considered exceptionally rare and valuable due to the mint producing far fewer sovereigns than other mintages. 1916 sovereigns, in particular, are highly sought after, as only 6119 of them were produced in that year.

Shop George V Gold Sovereigns

Design

George V gold sovereigns were produced in 91.67% fine gold (22 carats). The design of the coin was changed in 1929 to incorporate an inner circle and beading around the outside edge. This extra level of security made it much harder for forgers of the time to replicate the coin which is why the sovereign is still held in such high regard by collectors and investors.

Purchase George V Sovereigns through Physical Gold

Physical Gold offers a wide selection of gold sovereigns spanning over the last two centuries including those minted during the reign of George V. To browse our full selection of gold sovereigns please click here. For more information please give us a call on 020 7060 9992.

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Gold Sovereign coins tick all the boxes

There’s no doubt that Sovereigns tick all the boxes for the gold investor, especially in the UK. They’re good value compared to many other coins, small and therefore very divisible, very well known and liquid and Capital Gains Tax free to UK residents.

However, Gold Sovereign coins fall into two main categories. Brand new mint condition Sovereigns still in their Royal Mint laminate blister pack and circulated older sovereigns. So, which should you buy?

Firstly, it’s important to point out that collectors may have different motivations for investors, and they may overlook value to complete their collections. From an investment angle though, it’s always important to be ruled by your head and not your heart. Collectors may also be happy to pay significant premiums for proof Sovereigns (perhaps 20% or more), but the investor should steer clear of proof coins and stick to bullion versions unless you can buy at the same sort of price.

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Indeed, the first place most gold investors will start is price. Usually, I’d recommend that a
Sovereign buyer opts for older coins for the simple fact that you can pick them up for about 3% less than brand new ones. When it comes to selling them back, you’d probably receive 1% less than for a new one so you’re up 2% net. So that’s the end of the story……

Lack of supply

…except that right now there is a distinct shortage of second hand Sovereign gold coins on the market. If you are able to source some, premiums on them are higher than that of new Sovereigns, reflecting the lack of supply.

Alternatively, if you wait in the hope that the lack of old gold Sovereign coins supply will loosen, there is the real possibility that the underlying gold market price will move up from its current position. While some buyers obsess about the premium they’re paying for gold, it is the shrewd investor who realises that it’s the absolute price you pay and not the premium which will determine your level of return. It’s pointless waiting 3 months for the premium on circulated Sovereigns to fall 5% if the underlying price rises by 10% in that time!

Watch our video, “5 Reasons to buy gold sovereigns” a Physical Gold Ltd. YouTube video.

Either way, we’ve seen the underlying gold price fall significantly in December and it has only just started to rise again over the past week. With European debt issues intensifying, everyone agrees that gold should make strong gains this year. The recent price dip at the end of 2011 represents a great buying opportunity.

So for my mind, it’s best to act now before the price runs away, and as it stands Brand New Sovereigns ARE better value than old ones. They’re cheaper to buy, easier to sell (as they’re in perfect condition), and you’ll receive a higher price when you do choose to liquidate.

The advantages of buying newer issues

Buying gold Sovereigns that are newer has a few distinct advantages. As discussed earlier, older sovereigns tend to attract larger premiums due to rarity and age. So, by buying recent editions which do not attract such premiums, you can get yourself a good deal and extract greater value by purchasing them at lower price points. Since the demand for sovereigns far outstrips their supply, you can expect a good sale price for these in the years to come and maximise your profits. However, a smart tip to remember is that one should stay away from purchasing these coins in December since premiums start to rise around this time, as buyers anticipate the following year’s issue.

So, as long as you buy current issues at any other time, you can take advantage of the huge popularity of these bullion coins. They are minted by the Royal Mint in substantial quantities and should be available with most dealers in large numbers. Indeed, availability is one of the greatest advantages of buying current issues of the UK gold Sovereign. Needless to say, you can also secure good discounts if you buy the coin in large volumes. Do not restrict your purchases to a single dealer. You will need to shop around in order to get the best deals.

Always try to buy larger Sovereigns

Another great tip that I am happy to share with you is that you can gain certain advantages by opting to buy larger Sovereign coins. The logic behind this is quite simple. Smaller coins carry higher production costs. The costs involved in designing and cutting smaller coins is greater than production costs of larger gold coins. Due to this reason, larger coins are available at a lower price per gram.

Many investors prefer this option as it enables them to acquire more gold for their money. So, this can be a great strategy, especially if you intend to purchase Sovereigns in large quantities. An ideal choice, in this case, would be the quintuple Sovereign. This coin is popularly known as the 5-pound gold coin. You need to be aware that certain dealers do charge a premium for commemorative issues. So, steer clear of these premium deals and you can grab yourself a great bargain. The size of the quintuple Sovereign enables the coin to benefit from lower production costs and is a perfect choice for any gold portfolio.

Call us to discuss how to buy gold Sovereigns

In summary, the UK gold Sovereign is a ubiquitous choice for any serious gold investor. The coin is one of the most reputed in the world and is considered to be a flagship coin for investment, very much like the gold Britannia. Physical Gold has a team of gold investment experts who can help you make the right decisions when it comes to buying a coin of the stature of a gold Sovereign.

The advice we impart to you is backed by solid research on the availability, demand and price of the gold Sovereign. Reaching out to us is relatively simple. Just call us on 020 7060 9992, or simply drop us an email. A member of our team will contact you and help you choose the right gold Sovereigns for your portfolio.

 

Image credit: PublicResource.org

The many reasons to buy gold have been very well documented over the past few years. Most people are aware that the price has increased dramatically, they understand that gold offers great portfolio balance, protection against inflation and security against economic and political uncertainty.

What’s less obvious is which forms and types of gold to invest in. Like any tangible asset you buy, it is the price you ease you can sell it for which will determine your profit. If you buy a piece of gold that no one wants then it doesn’t matter how much the gold spot price has risen.

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Thinking of Investing in Gold Sovereigns? Download this FREE Cheat Sheet to ensure you get the best value

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Gold Sovereigns

Sovereign gold coins offer a number of compelling reasons to invest.

First of all, they’ve been around for hundreds of years so enjoy a very well established reputation and deep developed the secondary trading market. This means they’re easy to sell anywhere globally. The very fact that there are a huge number in circulation throughout the years also means a buyer has a great choice when buying. This contrasts with another UK coin, the Britannia, which has only been around for 20 or so years. So buyers generally only have the choice of brand new coins.

As a relatively small coin, they offer the chance of owning a larger number and variety than

1oz coins. Variety and diversity are always good benefits when you’re seeking a balanced gold portfolio. Because you get roughly 4 Sovereigns to an ounce it is easy to liquidate the portfolio in smaller fractions. This increased divisibility offers the investor a high degree of flexibility with their gold coins. It is also easier to find buyers of coins worth £200 or so than £900.

A major selling point of Gold Sovereigns is their tax free status. As a 22 carat coin Sovereigns are classified as investment gold and so are VAT exempt. This contrasts to some other forms of gold such as jewellery and gold nuggets, and indeed other precious metals such as Silver and Platinum which all attract VAT of 20%.

Tax Free Gold

The real bonus with Gold Sovereigns is that they’re also Capital Gains Tax free for UK residents. As legal tender in the UK, the Government don’t tax the movement of legal currency. This means that unlike some great foreign coins like the Krugerrand and Maple Leaf, investors get to keep 100% of their profits upon disposal rather than pay up to 28% to the tax man!

So the case for buying Sovereigns is strong, but you still need to ensure you’re getting the best value for money. Almost always avoid buying proof Sovereigns if you’re an investor. You can pay 15-30% premium over bullion coins and will likely receive a fraction of this benefit when you come to sell. You should only consider proof coins if you’re paying close to the bullion price or if you’re a collector.

If you’re considering choosing between full Sovereigns and half or quarter Sovereigns, then always go for a full Sovereign if you can afford it. You’ll likely pay a higher premium for the smaller fractional coins equating to less gold for your money. I also think there is less demand for the half and quarter Sovereigns as they really are very small coins. Conversely, I think the £2 ‘double Sovereign’ and £5 ‘quintuple Sovereign’ represent good options.

Finally, you need to ensure you buy the right age of Sovereign. This rule is relatively simple. Right now brand new Sovereigns remain expensive in my opinion. While they are beautifully finished you can pay 5% or more on top of second-hand prices. Like buying a car, that coin will not be the latest mint year within a year, so will represent bad value. I don’t see a huge difference in the various years of issue in second-hand Sovereigns. Infact, I see value in holding a nice mix of coins, whether they be Elizabethan, Edwardian, Georgian or Victorian. As long as the condition is decent, it can be beneficial and enjoyable to hold coins from a number of eras. Some dealers may pay a little more for Edward VII Sovereigns purely because of his short stay on the throne but the difference is marginal.

When buying gold sovereign coins watch our YouTube video – “6 Hacks to buying the best value gold sovereign coins”

All our semi-numismatic Gold Sovereigns are of at least selected quality which means we handpick our coins for a large number, rejecting those that may be showing their age more than others.

Happy investing!

Coinex numismatic trade show is an annual event held every September in London. It marks one of the most anticipated events of the British calender for avid coin collectors and enthusiasts. Organisers, The British Numismatic Trade Association (BNTA) are opening up the event to more dealers than ever, promising excellent choices for collectors and investors alike. 2023 is a special year as it marks 50 years of the BNTA and more than 4 decades of the Coinex event.

Who are the BNTA?

The BNTA was first formed all the way back in 1973 in order to help the nation’s community of coin dealers engage with the government on tax issues impacting their industry, while also attempting to stamp out forgery and counterfeit coin operations.

Just five years after its formation it launched the first Coinex event, traditionally hosted in the heart of the capital at hotels and event centres near Mayfair.

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Plans for Coinex

Coinex is traditionally held each year at The Ballroom of The Biltmore Hotel, Mayfair, Grosvenor Square, London W1K 2HP. This  at the Millennium Hotel, London, Mayfair. This venue is rebranded from the old Millennium Hotel. The hotel has was recently upgraded to a five-star status following an extensive renovation and facelift. Today, the prestigious hotel at 44, Grosvenor Square, Mayfair is part of the Hilton group. The hotel has been renovated at a cost of £50 million through 2018 and will celebrate its brand-new opening in September 2019. The BNTA believes that it will be an ideal location for Coinex for years to come. The luxurious new conference halls will mean that a larger line-up of coin dealers and attendees can be accommodated. With excellent public transport links, secure delivery access and the perfect positioning for people who want to explore London as well as buying gold coins, the Biltmore, Mayfair should be an ideal setting for Coinex Trade Fair.

Why attend this event?

Quite simply the BNTA’s size and influence mean that this annual get-together of dealers is one of the best places to find valuable coins of every conceivable age and quality.

The involvement of the BNTA also gives buyers peace of mind about the provenance of what they are buying. Every dealer this year will either be a member of the association or have been invited specifically to set up shop because they are known to be reputable. A total of more than 45 exhibitors are in attendance, representing the top UK numismatic traders, auction houses and European dealers.

It’s worth noting that over the years Coinex has expanded to include more than just rare coins. Everything from banknotes and medals to bonds and shares will be on sale, so even people with a passing interest in rarities and collectables should make an effort to attend.

With the event increasing in size year on year, you can also expect to see antiques of other types mixed in amongst the stalls, ensuring there’s something for everyone.

The 2023 Coinex event will be from 29 September 2023 – 30 September 2023. Opening times are 11am-4,30pm on Friday 29th Sep (last entry 4pm). VIP entrance fee £30. Saturday 30th Sep 10am-3.30pm (last entry 3pm), entrance fee just £5.

Why buy gold and silver coins?

Some people buying precious coins just for the thrill of collecting rare, historic objects. Others do so to make an investment in a physical commodity that will appreciate in value. Whichever category you fall into, Coinex should pique your interest. Gold coins have historically kindled the interest of numismatists and investors alike. As a stable asset class, gold coins add balance to an investment portfolio. Silver coins, on the other hand, have gained popularity over the years, as investors see the white metal as a promising investment vehicle that could provide rich returns in the foreseeable future.

Invest in precious coins with Physical Gold

If you are interested in buying rare gold coins and collectable silver coins, you don’t have to head all the way to an event in London and haggle with dealers. Contact Physical Gold by calling 020 7060 9992 or using our contact form for advice, quotes and assistance.

 

Image Credit: Burst

When making a decision regarding gold coins for our investment portfolio, we have to probe into the history of the coins, find out more about their investment potential and assess their availability. We can make an educated decision based on certain factors that most investors would consider when choosing a gold coin for their portfolio. In this article, the two coins that we shall discuss are the famous British Gold Sovereign and the South African Gold Krugerrand.

History of the coins

The Gold Sovereign

The iconic gold Sovereign has been an integral part of British coinage for more than a couple of centuries. Modern gold Sovereigns have been issued since 1817. However, it ceased to be in circulation since 1932. Gold sovereigns are now minted by the Royal Mint as a bullion coin. This amazing British coin has been minted throughout the reigns of several British monarchs. During the reign of Queen Victoria, the Sovereign witnessed three different issues, better known as the Young Head, the Jubilee Head and the Old Head. The coin is instantly recognisable due to the famous design of St George and the Dragon, which was initially created by the Italian designer, Benedetto Pistrucci. It is a coin that is loved by many investors and numismatists and worth including in your investment portfolio.

The Gold Krugerrand

The gold Krugerrand is a more recent coin. It was first issued by the South African Mint in 1967 and produced with gold provided by the Rand Refinery. The Krugerrand gets its name from the former president of South Africa, Paul Kruger. Of course, the country’s currency is called the Rand. Hence, the coin is named Krugerrand. The obverse of the coin has an image of President Paul Kruger, while the reverse features a Springbok, which is the country’s national animal. By 1980, the Krugerrand was the leading choice for investors, who wanted to buy gold coins. Due to its popularity, the coin prospered and represented 90% of the international gold coin market at one time.

Comparing the two coins

Gold Sovereigns can be a better purchase for UK investors than a Krugerrand as any profits are tax-free. While a Krugerrand can provide a cheaper overall purchase cost per gram due to its larger size, dealers may pay less for them and any profits are taxable. Sovereigns have been around for far longer so provide the possibility of owning more historical coins.

Liquidity and value

In terms of liquidity, both coins are well-placed. Both the Sovereign and the Krugerrand are globally renowned coins and sell quickly. Both coins feature 22-carat gold, which is a fineness of 91.7%. However, it must be noted that the older Sovereigns can fetch better value due to their age. The Krugerrand is a more recent coin and does not command premiums based on rarity and age.

Diversity

If we were to consider diversity, the gold Sovereign is a better choice. Having been around for centuries, the coin is available in a variety of issues and sizes. The gold Sovereign has many different sizes. Like the quarter Sovereign, the half Sovereign and even a double Sovereign. Investing in these coins can create flexibility for your portfolio, allowing you to sell different amounts of gold at different price points in the market.

Call Physical Gold to get the best advice on buying gold coins

Physical Gold is one of the most reputed gold dealers in the country and our investment team can advise you on making the best purchases in gold coins. Call us on (020) 7060 9992 or reach out to us via our website and a member of our team will contact you right away.

Image credits: Wikimedia Commons and Public.Resource.Org