Investing In Gold Coins And Bullion
By: Davin Michaels

The first known coins were minted in the mid-seventh century B.C. Coins revolutionized the conduct of commerce.



Alexander the Great introduced a regulated and universal coinage
throughout his empire. Coins were typically engraved with the
likenesses of rulers and deities, providing a historical snapshot. Coin
collecting started in Renaissance Europe. Wealthy



Europeans collected Greek and Roman coinage.

The United States minted its first gold coin in 1795. From then until
1933, U.S. mints produced hundreds of styles and denominations of gold,
silver and other coins. Dazzling pieces of artistry and history,
collectible rare coins and bullion are among the most prudent additions
to any quality investment portfolio.



A collection of coins and bullion could add value and stability to a
portfolio. Investing a percentage of a diversified portfolio in gold,
silver and platinum could act as a hedge against inflation. Gold can be
viewed as an alternative asset class. Tangible assets are usually not
as susceptible to the same market pressures as stocks and bonds.
Typically, gold is not correlated to either the stock or bond markets.



Gold often trades inversely to the U.S. dollar, making it a useful
hedge in times of dollar depreciation. The gold supply is limited – all
the gold ever mined would fit into a storage room about 55 feet long,
55 feet tall and 55 feet wide.



Bullion is a term for coins, ingots, private issue, and so on that
trade below, at, or slightly above their intrinsic metal value. Only
the precious metals (gold, silver, platinum, and palladium) are
included as bullion. A bullion coin is a legal tender coin that trades
at a slight premium to its melt value.



Examples of bullion: U.S. Gold, Platinum and Silver Eagles, Canadian
Maple Leafs, South African Krugerrands. A rare coin can be determined
by several factors: mintage, grade, series. Values of coins are
determined by both scarcity and grade.



Set building is the practice of collecting a complete series of coins
representing all the different designs of a certain U.S. coin, for
instance. It provides a systematic path for the collector.



Investors have frequently found that a carefully assembled set of coins
is worth substantially more than the total of its individual pieces.
Well-compiled sets have also tended to be more liquid than comparable
accumulations of random coins. It can provide an exciting historical
treasure hunt, as well as an investment instrument.



Set building provides the investor with the opportunity to define
objectives and formulate strategy. Set building can be a life-long
adventure. Sets can be collected by: type (which can be any particular
design or denomination), series (all dates and mints struck of a
denomination) or design type, commemorative issues, and more.



A key date coin is generally considered to be the most important coin
in a particular series, usually the lowest-mintage and/or the most
expensive. Rarity is based on the number of specimens extant of any
particular numismatic item.



For protection, investors and collectors should only buy rare U.S.
coins that have been graded and certified by the three leading
independent coin-grading firms: professional Coin Grading Service
(PCGS), numismatic Guaranty Corporation (NGC), independent Coin Grading
Company (ICG). These organizations are recognized industry-wide for
their accuracy, objectivity and high standards.



These services help to make the market in numismatic coins safer and
more liquid. When a coin is graded, it is immediately encased in a
tamper-resistant slab and sealed with its certification number and
grade displayed.

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