Re: Gold Bullion Bars vs. Coins

Hi guys, new to the forums (as evidenced by my post count). I'm interested in investing in gold bullion. Not looking to make a profit, just trying to diversify my portfolio with a stable investment that hopefully won't depreciate over time. I'm not looking for numismatic value, just the value of the metal itself (hence why I picked bullion).

I've done quite a bit of reading, but I've been having a hard time getting a definitive answer with regards to the question of bullion bars vs. bullion coins. I understand that, to some extent, this is a matter of opinion, so I completely expect people to state their personal preferences. However, if possible, please back said preferences with sound evidence-based reasoning as to why you went with the choice you selected.

Ounces vs. fractionals: Which is preferred, and why? Some people have said 1 oz. for lower asking premiums, other haves said 1/10 oz. for ease of liquidation.

With regards to coins: American Eagles vs. Krugerrands vs. Maples vs. Pandas, etc., and why?

With regards to bars: PAMPs vs. Credit Suisse vs. Perth Mint vs. Heraeus etc., and why?

Best places to buy: APMEX vs. Provident vs. eBay etc., and why?

Or, to frame the question a different way: If you had $10,000.00 USD to invest, and you were to invest in only gold bullion, what would you buy?

 

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American eagles, 1/4 and 1 oz, and bars, 1/4 oz and 1/oz

 

Try to get them for as little over spot as possible

 

Coins - 1 oz. Eagles because they are identifiable, desirable, and only a couple dollars difference between the buy/sell compared to the Kruggerand.

Bars - Any recognizable 1 oz. bars.

In your case, I would purchase 1 oz. bars because you primarily want bullion value and the bars give you the best buy/sell difference.

 

Thank you gentlemen! I appreciate the responses.

For coins, 1 oz. Eagles seem to be the consensus opinion. Is there a reason for the specific comparison with the Krugerrand? Is the Krugerrand a lower-purity bullion composition?

For bars, is Johnson Matthey the most widely recognized? I suspect PAMP is highly-recognized as well?

 

Pamp is highly recognized, but have huge premiums

 

Ok

I'm doing my best

Ounces and what some people say are generally correct - 1 oz often carries lower premium over fractionals. About 1/10oz being easier for liquidation, I think that depends on who you are talking to. I don't think there will be any problem in selling your 1oz coins to big dealers like APMEX, Provident Metals, Gainesville, Gold Mart, Golden Eagle, or others (I apologize for not mentioning all dealers here).
Having said that, I like to diversify my stuff. So, I would suggest to get 1oz (half of your total asset), 1/2oz (1/4 of your total asset), 1/4oz (1/8 of your total asset) and 1/10oz (another 1/8 of your total asset).

I will only buy American Gold Eagle and Maple Leaf. Please do NOT forget the American Gold Buffalo too! The good about American eagle is that it is highly recognizable. Plus, the US government guarantees its authenticity. When things go south, the secret service will be there to invetigate. The bad thing though, it is 22K, not 24K. So, in this regard, I would probably get the American Gold Buffalo and the Maple Leaf COINS. They are both 24K. The only problem with gold buffalo is that they seems to produce mostly 1oz coins.
So, in regard to diversification, I would probably get some 1oz of gold eagle, gold buffalo and maple leaf and get fractionals of the maple leafs.

I have no comment on this one. I did purchase a 10gram PAMPs in December when gold was cheap. But I wouldn't buy bars anymore. I strick myself to buy government minted coins only.

Of the three choices, I definitely say Provident Metals. But please check out Gainesville and Gold Mart. if you pay cash, all three I mentioned in my response have great discount. They differ in the shipping fees and delivery time. Based on my personal experience, Gold Mart or Gainesville is better in term of money followed closely by Provident. But in term of delivery time, no one beats Provident.

If I were you, I would buy the followings (for heaven sake, I round things up);
1oz gold buffalo (~2000)
1oz gold eagle (~2000)
1oz maple eagle (~2000)
1/2oz maple leaf (~1000)
1/2oz gold eagle (~1000)
1/4oz maple leaf (~500)
1/4oz gold eagle (~500)
1/10oz maple leaf x 3 (~600)
1/10oz gold eagle x 2 (~400)

Enjoy shopping! :hail:

 

Ok

I'm doing my best

Ounces and what some people say are generally correct - 1 oz often carries lower premium over fractionals. About 1/10oz being easier for liquidation, I think that depends on who you are talking to. I don't think there will be any problem in selling your 1oz coins to big dealers like APMEX, Provident Metals, Gainesville, Gold Mart, Golden Eagle, or others (I apologize for not mentioning all dealers here).

Having said that, I like to diversify my stuff. So, I would suggest to get 1oz (half of your total asset), 1/2oz (1/4 of your total asset), 1/4oz (1/8 of your total asset) and 1/10oz (another 1/8 of your total asset).

I will only buy American Gold Eagle and Maple Leaf. Please do NOT forget the American Gold Buffalo too! The good about American eagle is that it is highly recognizable. Plus, the US government guarantees its authenticity. When things go south, the secret service will be there to invetigate. The bad thing though, it is 22K, not 24K. So, in this regard, I would probably get the American Gold Buffalo and the Maple Leaf COINS. They are both 24K. The only problem with gold buffalo is that they seem to produce mostly 1oz coins only.

So, in regard to diversification, I would probably get some 1oz of gold eagle, gold buffalo and maple leaf and get fractionals of the maple leafs.

I have no comment on this one. I did purchase a 10gram PAMPs in December when gold was cheap. But I wouldn't buy bars anymore. I strick myself to buy government minted coins only.

Of the three choices, I definitely say Provident Metals. But please check out Gainesville and Gold Mart. if you pay cash, all three I mentioned in my response have great discount. They differ in the shipping fees and delivery time. Based on my personal experience, Gold Mart or Gainesville is better in term of money followed closely by Provident. But in term of delivery time, no one beats Provident.

If I were you, I would buy the followings (for heaven sake, I round things up);
1oz gold buffalo (~2000)
1oz gold eagle (~2000)
1oz maple eagle (~2000)
1/2oz maple leaf (~1000)
1/2oz gold eagle (~1000)
1/4oz maple leaf (~500)
1/4oz gold eagle (~500)
1/10oz maple leaf x 3 (~600)
1/10oz gold eagle x 2 (~400)

Enjoy shopping! <img src="http://www.cointalk.org/images/smilies/14.gif" alt="" title="Hail" smilieid="30" class="inlineimg" border="0">

 

Heck of a response! Thank you!

 

I think before you can find your answer to what to buy, you need to answer this for yourself.

1. Why are you buying physical gold?
2. What is your plan to liquidate your physical gold holdings?

I realized you stated in your OP that you wanted to diversify but this isn't the answer to question #1. You could buy a paper gold investment if this is all that you wanted to do. Why do you want to hold physical gold? There are a lot of various answers to these questions for individuals ranging from "I fear hyper inflation", "I want assets off the grid", "Just because", "zombie apocalypse", etc. Likewise, are you planning to sell your holdings in bulk at some point, or do you plan to wander into a pawn shop to sell small amounts to avoid Mr. Tax Man. (I'm not giving legal advice so nobody lecture me.)

You have to answer these questions before you can decide between bars and/or coins, and the denominations. Once you do, the rest becomes obvious.

 

I would buy 1 oz Maple Leafs. They are 24K, have easy liquidity, and coins are less commonly counterfeited than bars.

 

And be sure to check the weight, diameter, and width when you buy!

 

Diversify the gold. I think BioEtOH had a very good post, and I would second most of what was said there. However, I would throw in there that Krugerrands are also well enough known, and you shouldn't leave them off your list. Stick with AGE (or buffaloes), Maple Leafs and Krugerrands, and I think you'll be plenty safe and be very able to sell them off anywhere if you need to.

My personal opinion and strategy is to have more of the fractionals - in my case more 1/10 and 1/4 - than the full 1oz. Yes, they sell for a premium, but you can also resell for the same premium, so frankly I think it's a wash. I like the idea of being able to sell or trade a smaller amount at a time because it's very easy to move at lower prices, there's a larger base of buyers with that kind of available cash. Yes, you will always have the ability to sell back to the large shops any size coin, but in my opinion you will probably get more back on average selling private than to any dealer.

I'm not a personal big fan of the bars, - a 1-gram bar is tiny, tiny. I stick to rounds.

 

1. Physical gold is tangible, a characteristic which lends itself to a personal sense of security. I understand the drawbacks to physical gold (risk of theft, eventual need for a safe/safety deposit box, etc.). Zombie apocalypse and anarchy notwithstanding, aside from security of having something readily at hand, to some extent it probably has (at least to an extent) something to do with the romanticism attached to the concept of physical ownership of a valuable natural resource. Couldn't a similar argument be had with regards to cash vs. bank accounts vs. stocks/bonds vs. futures etc.?

That said, the reason I didn't mention ETFs, futures, mining companies etc. is because I didn't think it was an appropriate discussion topic in the Bullion forum. That doesn't mean I won't invest in those things too. I plan to set a budget and then diversify on all fronts, dividing a predetermined amount between a variety of investments.

2. I'm not entirely sure on how I would liquidate, as it's impossible to predict what the future holds for us. The point to having physical gold is more for the, "What happens if..." contingency. If the national power grid goes down secondary to aliens, zombies, terrorism, etc., paper investments will largely be irrelevant. But there also wouldn't be internet, so eBay, APMEX, Provident, etc. would also no longer be relevant. If the world ended, would somebody working at a pawn shop still keep working at a pawn shop? Will gold even be worth anything? Would humanity move over to a barter system? Who's to say? On the other hand, if the place where the gold is stored gets robbed or catches fire, short of storage in an everything-proof safe, the physical gold is probably gone.

So I guess the most apt answer is that I don't know how I'd liquidate. Would I be better off investing my money in guns and ammunition?

Thanks! All good reasons. Any reason for Leafs specifically (as opposed to other types of coins)?

I think this is solid advice. At this point, I'm leaning towards sticking with rounds. I'm not sure how I'll split between AGEs, Buffalos, Leafs, Krugerrands, but that's an easier decision (I'll probably entirely forgo Pandas and others). Do you think that BioEtOH's breakdown on fractionals is appropriate, or do you have a different suggestion with regards to how one should go about distributing between different weights?

Will stay away from bars to start. Knowledge and ideologies regarding bars seem nebulous at best.

With regards to AGEs vs. Buffalos: They're both one troy oz. of gold, right? The only thing they differ in is metal purity? Is there any pragmatic (read: non-theoretical) logistical reason to buy one over the other?

 

I recommend rolls of 1/10 ounce eagles. you can get the price down that way and have a more easily distributed amounts

 

They both end up with 1toz of gold contained within but I believe that is correct with the purity amounts. I think it boils down to personal collecting preference if you prefer one over the other. Personally, I wasn't aware of the buffaloes until recently, so I guess there's a possibility the immediate recognizability of an AGE over a buffalo might exist amongst the general masses.

I'm trying to accumulate a roll of both 1/10 and 1/4oz bullion, but it's going a little slow...

-Gary

 

If you can get the same price as if getting best price purchasing 1 oz. Eagles, I agree. Otherwise no, stick with 1 oz. Eagles or Maples (depending on relative price as to each).

 

I don't remember the details but the purity or lack of AGEs makes them difficult to trade and/or import into some foreign countries.
I'm sure others will post the details

Mike

 

You mean they are 22 not 24k? Well a lot of bullions'/gold coins are often bought to be melted down to turn into Jewelry in places like Asia when times comes' so the fact the AGE is 22k makes' it less attractable and compared to PM and other mints which have stepped up their issues' in terms of newer designs' and advertising. US mint has fallen behind and i rarely even see many prominent coin stores in places like HK even carrying that any products from US and generally eagles sell for spot where as Pandas/Kangaroo/Lunar issues get a good premium.

 

Yes its the 22k vs 24K but it's not Asia it's Europe and it's a legal issue.