Here’s What You Should Know
Coin collection is one of the oldest hobbies in the world. It’s an appreciation for art, antiquity, geography, and economics, all of which are embodied into precious metal coins. The practice of collecting coins for their antique or artistic value started in Ancient Rome and medieval Mesopotamia. Scholars and state treasuries collected and studied coins, giving rise to the science of numismatics.
While investors buy gold mainly because of its market price, collectors are drawn to gold coins for artistic and historical reasons. They are exclusively crafted coinage, featuring decorative designs, which are changed regularly to denote special events, milestones or national celebrations. If you’ve ever wanted to collect gold coins, but didn’t know where to begin, this blog is for you. Below are a few tips to help you get started, and educate you about the basics of gold coin collecting.
Your Guide to Collecting Gold Coins
Gold bullion coins are an excellent way to start collecting coinage, mostly due to the value in their precious metal content. As you gradually know more about numismatics, it’ll be safer to invest in rarer coins, but fine gold coins will always hold their value.
Coin collectors consider a number of factors when investing in gold coins, such as composition, design, finish and mintage. These factors along with the coin’s age, determine its value. As a novice collector, purchasing coins from other collectors can be a risky move. There’s a whole new terminology to coin collection that you need to learn.
The term “composition” means what the coin is actually made from – the basic metal and its purity. Two of the most common compositions include:
- 99999 (or 99.999%): Extremely high purity of gold.
- 9999 (or 99.99%): 24-karat gold of high purity.
Many gold items from the Royal Canadian Mint boasts a remarkable 9999 purity. The American Gold Eagle coin, one of the world’s most coveted gold coins, has a purity of only 9167 and contains 1 ounce of gold. With a purity of 99999, the Royal Canadian Mint Gold Bullion Series is unique and delivers the best quality gold coin to any investor or collector. The collections at Silver Gold Bull is centred around gold bullion coins. You can also find Canadian Gold Maple Leaf coins.
An exceptionally important term for coin collectors, “finish” refers to the surface texture of the coins. The most popular finishes are:
- Proof: The coin has been struck at least twice with a frost relief on a brilliant surface
- Reverse proof: Bright, reflective or mirror-like finish on a frosty or slightly matte surface
- Specimen: A brilliant image finish against a matte or lined backdrop
The numismatic value or the value of a coin’s precious metal content is more significant than its face value (the nominal value displayed on the coin). However, gold coins from the Royal Canadian Mint are given face values as legal currency. When you buy gold bullion coins, you pay for the gold content, and not its face value. The same thing is applicable when you sell gold coins. As you become more adept at collecting rare coins, numismatic value will be a determining factor for how valuable a coin is.
Mintage means the total number of a specific coin produced by the mint in a particular year. This will decide its rarity in the near future. Nevertheless, it doesn’t mean that a low mintage coin will have more value in the coming days. Its demand and corresponding rarity will make it more valuable. For example, a 1967 Gold Krugerrand from South Africa (the very first gold bullion coin sold to collectors) will have a higher value in comparison to a 2016 Royal Canadian Mint gold coin. This is basically due to its unique lineage and distinct rarity.
Now that you have some basic knowledge about coin collecting and its related terminology, you can start your own coin collection. It’s a fun, engaging and educational venture that will arouse your curiosity and encourage you to know more. When you research about coins from different parts and eras of the world, you know about their political history and changing economic policies. An expert gold coin collector can make money out of their hobby, but for most of the passionate coin curators, their collections are a rare treasure that they would like to pass onto their children. It’s a precious hobby that can last a lifetime.