Deciding to invest in precious metals comes with plenty of options. You can buy tangible gold products or invest in gold ETFs, futures or mining. The most popular option is to invest in physical products, also known as bullion. But the decisions don’t stop there.
When purchasing bullion, reputable dealers like Global Bullion Suppliers offer bullion in the form of coins and bars. While having all of these choices available to you is a good thing, as it allows you to find the best investment solution for you, it can also complicate matters, especially if you have yet to gain experience investing in bullion.
Being informed of the similarities and differences can make all the difference. Here, we’ll discuss what you need to know to help you decide whether bullion bars or coins are the best choice for you and your investment goals.
What Are Bullion Bars
Bullion bars are produced by mints or refiners and are simply bars with basic information such as the weight of the bar, gold purity, serial number, logo, and manufacturer. There are minted bars, which have a more finished appearance, and cast bars, which have a rougher, less polished appearance.
What Are Bullion Coins
Bullion coins are actually legal tender in the country where they are made. While private refiners can make bullion bars, only sovereign mints can make coins. Coins also typically have detailed designs or images on them.
Value And Costs
Bullion coins can be valued for their precious metal value as well as their designs. The precious metal value is almost always higher than the face value, but coins come with a premium cost because of their designs. They can be appealing to those who are interested in investing as well as collecting. From different designs and rarity to coins that come from different countries around the world, there is a lot of interest in coins.
However, coins also come with higher manufacturing costs and are usually more expensive per ounce than bars.
For those who want to focus on minimizing upfront costs, bars might be the best solution.
With any investment, it’s important to ensure that what you’re buying is what you think you’re buying. Counterfeits do exist, and technologies to make them continuously improve, making some very difficult to spot. Thankfully, technology to increase the security and verification of bullion bars and coins is constantly improving.
Coins tend to have the edge here, with higher security features. However, there is growing investment in technology to better verify gold bars.
A benefit of bullion is its liquidity. You have the physical product, and if you want to sell it, all you need to do is find a buyer. While precious metals are generally always in demand, coins are easier to sell than bars. This is in part because of their recognizability. Gold coins can be sold in a variety of places and also usually have a stronger demand than bars. The uniqueness of their designs, which also drives up costs, creates more interest in the market.
Ultimately, there isn’t one right answer when it comes to choosing between bullion coins and bars, and the best choice will depend on what your priorities are with your investment.