Buying Gold Guide
There are three main ways an investor can buy gold – Krugerrands, gold bars and gold sovereigns.
Gold bars are the least expensive way to buy gold, followed by Krugerrands and finally sovereigns. Each method of purchasing gold has advantages and disadvantages, so it’s worth your time researching the most suitable preference for you.
Gold Bars
Buying gold bars today will cost one between £75,000 to £92,000. While this may prove too expensive for the small time investor, kilo gold bars can be purchased for approximately £6000. One can use the British Numismastic Trade Association (BNTA). The BTNA was founded in 1973 and organise Coinex, the only major International Coin Fair held in the UK, which takes place each October in London.
Gold bars, while relatively cheap, can be difficult to sell. One must use a recognised, specialist gold dealer through which to buy and sell gold. Furthermore, the gold bar cannot be split into smaller parts and sold – one most sell it in its entirety.
Being a tangible investment, one must also consider storing gold. At present, the safest place to store gold is using a deposit box in a secure bank. This will cost upwards of £100 per year and needs to be factored into the investment cost.
Krugerrands
A Krugerrand is a South African gold coin first minted in 1967. Krugerrands cost approximately £250 to buy. They can be bought in great quantities, often at a discounted price, or as single 1 ounce coins. The coins are decorated with the face of Paul Kruger on one side and a springbok on the reverse.
The production quality of the coins is, typically, to a high standard, although they do not have the historical value of gold sovereigns. However, Krugerrands provide an effective means for small time investors to buy gold, plus they contain exactly one ounce of pure gold, making it a dependable way to compare prices.
Gold Sovereigns
Gold sovereigns are the most prestigious form of gold, outdating Krugerrands and also having a classic, historic value. Sovereigns are small than their modern South African counterparts and are considered the shrewder long term investment. Yet, due to their attractiveness as an investment, sovereigns are more expensive than Krugerrands buy up to five per cent.
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