Deciding on Investing in Gold Coins vs. Gold Bars

Whether you are a novice or a veteran in buying gold, the dilemma of investing in gold coins vs gold bars always requires some thought and deep consideration. Number of reasons and factors contribute to that decision including your personal circumstances and goals. Some of the key factors to consider are –

Premiums

This refers to additional costs apart from the gold price and encompasses manufacturing costs, packaging and handling, insurance and delivery. This amount varies from company to company in an effort to remain competitive. However, one common factor prevails. Generally gold bars have lower premiums than gold coins. This is because they have a larger unit size which implies lower manufacturing costs.

Flexibility

Majority invest in gold for creating a diverse and rich wealth portfolio as well as for getting maximum returns on their investments. Gold bars tend to give best value when buying but not when selling. In contrast smaller gold bars below or equal to 100 gms or gold coins offer greater flexibility and returns when selling. They facilitate part selling which can raise some quick cash when required and sometimes give better returns on investment.

Other pros and cons of gold coins investment

Gold coins enjoy a legal tender status and are more easily collectible than gold bars. They are also available as junk coins which can sometimes be procured at a price lower than the spot price. They also have a higher liquidity, helping any investor raise instant cash in any financial emergency situation.

Other pros and cons of gold bars investment

Comparatively, these are easy to store and transfer as they can simply be stacked. With the lowest premium any time over the spot price, it also helps any investor to build their financial portfolio pretty quickly. However, during any financial crisis, larger bars are extremely difficult to barter and raise liquid cash fast.

 

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