Advantages and Disadvantages of Investing in Bullion and Coin

September 14, 2006 | By | Reply More

Gold IngotThe simplest and most efficient method of participating in the precious metals market is by the direct purchase of the physical metal in the form of bullion or coin.

For the serious and financially secure investor large bullion bars are usually available at lower premiums than smaller shapes and coins.

The downsides are the regular charges for storage and insurance and the limited market when it comes to selling.

It is clearly not practical to attempt to sell part of a one kilo bar of gold or platinum and finding a buyer other than a larger dealer limits the dealing options open to the holder.

Storage and maintenance need no longer be a consideration. Read on for information on ways to hold gold bullion without significant maintenance costs.

For those who wish to trade physical precious metals easily, one ounce bullion coins have the edge over other one ounce bullion shapes such as wafers.

Governments guarantee coins, bullion is guaranteed by Refiners.

Bullion coins are mass produced, easily recognized so easy to sell on and usually attract a competitive premium.

The older the coin the more likely it is to have a higher premium.

Bulk purchases of the newer coins, say 100 or more are likely to have premiums close to those enjoyed by larger bars.

It will pay to shop around on-line for the best price and lowest premium for the weight of coin irrespective of the country of source.

Always be sure to check out the amount of pure precious metal contained in the coin or bullion and the authenticity of the source.

Older coins such as the British sovereign may be a better buy than newer coins.

The market and the premiums constantly fluctuate so no long-term price presumptions should be made. All investment gold, including coins, is exempt from VAT in the entire EU. Before investing in physical precious metals check out the tax implications in your country of residence.

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Category: Bullion

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