Buying Bullion Bars VS Coins — Pro’s and Con’s
Original Source: Guardian Gold Australia: https://guardian-gold.com.au/market-updates/buying-bullion-bars-vs-coins-top-pros-and-cons/
When it comes to investing in precious metals, gold and silver are two of the most popular options. But within each of these metals, there are two distinct forms of investment: bullion bars and coins.
In this article, we’ll explore the differences between gold and silver bullion bars and coins, and help you decide which one is right for you.
Gold Bullion Bars Vs Coins
Gold bullion bars are usually rectangular blocks of pure gold, usually ranging in size from one gram to one kilogram. They are produced by private mints and government mints (such as The Perth Mint), and their value is based purely on the weight and purity of the gold they contain.
Gold bullion coins, on the other hand, are coins that are usually minted by government mints and have a face value, which is usually much lower than the value of the gold contained in the coin. The value of the coin is based on its gold content, as well as its rarity, condition, and historical significance.
One of the main advantages of investing in gold bullion bars is their lower premium. Since they are produced by private mints, there are fewer production costs associated with their manufacture, which means that they are often sold at a lower premium over the spot price of gold than gold bullion coins. This makes them a cost-effective way to invest in gold.
Another advantage of gold bullion bars is that they are easy to store and transport. Since they are compact and uniform in shape, they can be stacked neatly in a safe or storage facility, which makes them ideal for investors who want to store large quantities of gold in a small space. For example, the safe deposit box options at Guardian Vaults will fit a greater weight of bullion bars VS coins, as the coins packaging tend to take up more space.
Gold bullion coins, on the other hand, are often preferred by investors who are interested in collecting as well as investing. Since they are minted by governments, they often have a unique design and historical significance, which can make them more valuable to collectors.
In addition, gold bullion coins can be easier to sell in certain markets, since they are more widely recognized and accepted as a form of currency. This can make them a more liquid investment, which is important for investors who may need to sell their gold quickly in the event of a financial emergency.
Silver Bullion Bars Vs Coins
Like gold, silver bullion can also come in the form of bars or coins. Silver bars are typically made using the same process as gold bars, and they can range in size from as small as one ounce to as large as 1,000 ounces. Silver coins, on the other hand, are typically smaller than bars and are often made in denominations of one ounce as the most popular size.
One of the advantages of silver bars is that they are generally cheaper than coins. This is because the manufacturing process for silver bars is simpler than for coins, which means that the production costs are lower. This can make silver bars an attractive option for investors who are looking for a cost-effective way to invest in silver.
However, like gold bars, one of the downsides of silver bars is that they can be difficult to sell privately. This means that investors may need to find a bullion dealer like Guardian Gold who is willing to buy the bars in larger volumes.
Silver coins, on the other hand, are generally easier to sell and very liquid given their low value per coin. They are recognized by dealers around the world, and there is a well-established market for silver coins. This means that investors can sell their coins quickly and easily, which can be an important consideration for those who may need to liquidate their investment quickly. Many silver coins are traded in the secondary market.
Another advantage of silver coins is that they can be much more collectible than silver bars. This means the selling value of the coin in the future could be well above the underlying spot value of the coin, depending on it’s rarity. Many Perth Mint silver coins like the lunar series are considered collectable and often have larger premiums in the secondary market some years after their initial release.
One of the most important considerations would be where you intend on liquidating your bars or coins in the future. The vast majority of bullion dealers will pay the same per ounce price on bars and coins, so it may be best to stick to bars if you intend on selling back to the bullion dealer you initially purchase through.
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