Like all investments, there are many pros and cons to gold bars and gold coins. Typically, you will lean to one over the other due to the pros suiting your situation more. However, finding information that breaks this down can be difficult to source. Whether you’re a beginner or an experienced investor, it’s important to know all the pros and cons of each investment, to ensure you’re investing your money optimally. Read on to discover the advantages and disadvantages of both gold bars and gold coins.
Premiums & Value
Gold coins are typically sold with a higher premium percentage in comparison to large gold bars as a result of higher production costs. However, smaller gold bars also incur high premiums that are sometimes higher than coins. This arguably makes large investments more efficient and straightforward when investing in large gold bars, as you get more gold for your money. With that said, some gold coins have more value than just the intrinsic value of the metal itself. Some also hold collectable value, which can also gain numismatic value over time. Furthermore, gold coins are legal tender and bars are not. However, the intrinsic value is worth more than the tender itself.
Profits, Selling & Liquidity
Despite having higher premium percentages, some coins - such as British Sovereign - profits are free of Capital Gains Tax when you sell, meaning you can sell your coins with flexibility, without losing out on potential profits. Not only that, it’s significantly easier to sell gold coins in comparison to large gold bars, especially in the event of needing to raise funds. For example, if you have a 100g gold bar, and require the value of 5g of gold, you can’t just cut it off - you would have to sell the entire bar, which is a difficult task in itself. Whereas if you had the same weight in coins, you would only have to sell a small portion. However, as previously mentioned, 100g grams of coins would come with a significantly higher premium in comparison to a 100g bar.
Carat & Certification
Gold bars are typically 24 carats, making intrinsic value simple. As well as this, it’s easier to buy gold bars with certification, verifying the legitimacy of your bullion. A lot of gold coins are 22 carats or slightly less, and ideally, you want them to be 24 carats to understand the intrinsic value easily. Furthermore, some coins don’t come with certificates that verify the mint, unless they are part of a coin set or they are proof coins.
Storing small amounts of both coins and bars is relatively simple, with options to store at home that are more than suitable, or alternatively stored using our professional vault storage. Larger quantities are where things get slightly more complicated. Realistically, you don’t want to store large amounts at gold within your home, as this will drastically up your home insurance premiums, and needless to say, using professional vault storage is a much safer option. Large gold bars are arguably easier to store, due to their consistent shape. Gold coins are slightly more tricky, requiring tubes to keep them organised.
Which one should you invest in? That's up to you! Beginners will probably find gold coins a better investment, and large gold bars are arguably the best option for serious investors. With that said, both make great additions to any investment portfolio. The pros and cons listed should help you determine which of the two is better for you.
Here at Bleyer Bullion, we have expertise in a variety of precious metals, to help you make a worthwhile investment. If you would like any further assistance, give us a call on 01769 618 618.