Since time immemorial, gold has always been valued as one of the most precious metals on the planet. It has been shaped, molded, minted and made into jewelry that symbolize good taste and wealth. As of late, the price of gold seems to be continuously increasing and many collectors are starting to wonder when the best time to sell gold coins is.
Sell Gold Coins for Cash
Thorough research is important in order to know more about the opportunities of selling gold coins. If you want to sell your gold coins for cash, the best options available include trading sites or shops, auction houses, individual collectors or organizations.
Those who are into the gold trading business would find it easier to determine the best opportunities to sell gold coins. But since not many people make a career out of gold trading, it could sometimes be a challenge to decide when to sell gold coins that would also result in a sizable profit.
Collectible Gold Coins
Although gold is a valuable metal, it is not immune to inflation and it has been through some high and low times. Their market value is dependent on the weight, carat and historical value of the gold coins. Especially if you own rare gold coins that were minted before 1933, you will have a better chance to make more profit from your collection because these are highly valued pieces of bygone years. And as the gold coins get older and rarer, their prices will most likely increase because some jewelers will melt them down for the gold value.
Serious gold coin investors employ one common strategy and that is to keep a lookout on the definitive market cycles. To optimize profit, they purchase gold coins which are currently undervalued. They keep these coins in their possession until the time when investors decide to move in and start to bid the coin prices up.
Basing on the rates for selling gold coins in the U.S. Rare Coin Market, the highest prices ever recorded for gold coins occurred during the time when the U.S. economy experienced inflation. While the stock prices were plummeting, the prices for selling gold coins were surprisingly following the opposite direction. And for this reason, many investors find gold as a good hedge against inflation and an effective way to diversify an investment portfolio.
When it comes to selling gold coins, the right time would depend mainly on how badly you need cash, what you intend to do with your profit or whether you want to use your gold coin collection as a long-term investment strategy. So, the decision is all yours to make.
Disclaimer: This is not a professional opinion to buy or sell any investment vehicle, just my opinion is based only on what I know, which may be incomplete or wrong.
Tags: gold tips, sell gold coins
For most serious value investors, gold is not regarded as an investment in their own right but rather an insurance or hedge against inflation, shaky economies, political turmoil and other unlikely events that may cause social unrest or devaluation of currency. The demand for gold in the market is often a result of financial uncertainty. In fact, it has always been proven time and again that gold demand will soar higher as the economy shows higher levels of ambiguity.
As a practice, investors use gold as a way to diversify investment portfolios. But an educated investor would often only allocate more or less 5 percent of his total investment portfolio to gold. And to have a better picture, let us compare gold to the more favored types of long term investments.
Gold vs. Stocks
It may be true that stocks are exposed to greater risks compared to gold investments. But when it comes to investing for the long term, stocks should still be more favorable than gold despite the current shrinking of the US stock market. The price of gold has a bigger tendency to ride a wave of emotions and it is also highly manipulative. Once the economy recovers, gold prices will most likely go back down. If invested within the same time frame, gold investments may prove to be more of a disappointment while carefully chosen stocks would have a chance to fare better and offer more lucrative results.
Gold vs. Bonds
Compared to other long term investments, bonds have proven over the years that they come with a lesser degree of volatility. In addition, the risk associated with bonds is much lesser than gold which is also subject to inflation at any point in time. The return may not be as lucrative as other types of assets but the standard deviation for bonds is within the range which investors could consider as a safe level. Gold should not be taken as a replacement for bonds because you will only be increasing the level of risk for your investment portfolio rather than lowering it.
There are many other reasons why gold does not qualify as a good long term investment. This just explains why a lot of people prefer to sell gold coins if they own them, especially when the prices are high. Since gold prices may plummet substantially at any point, there is no better time to sell gold but during times when you can get the most profit out of your gold investments.
How valuable is gold?
It has been given such high value mainly because it is a rare metal. It has shown to have many uses since the time of our ancestors. Even in our present times, we see in the movies the great lengths that people will go to to get their hands on gold. It means wealth spelled in bold letters. But just how valuable is gold really? Let us take a look at gold equivalents and see how much of other commodities can we get compared to a certain amount of gold.
How much can gold buy?
Based on the current price of gold which is around US$1,665, an ounce of this precious metal can buy:
• approximately 425 gallons of gas (in Los Angeles where I live)
• about 350 gallons of organic milk depending on the brand you choose
• about 830 dozens of Large Grade A eggs
• more or less 2800 individually wrapped Twinkies
• more or less 1000 pounds of tomatoes
• around 800 loaves of bread
• around 475 large boxes of cornflakes
• about 16 young goats
• approximately 1660 movie tickets without pop corn.
This is obviously not a serious evaluation of gold’s value, but in part to show what a tiny amount of gold can buy. These estimates just show how much value people put into gold in comparison to other commodities used on a daily basis. This also gives a very clear picture as to how a very small amount of gold could already purchase a relatively high volume of another article of trade.
Especially during times of inflation, money in the form of paper bills will have a lower value relative to gold. And this is where the role of gold investments comes into play. We know for a fact that other types of commodities like milk, food and other perishable items would not be a wise investment to have physically. In the event that the country’s dollar devalues, the price of gold rises and that offers an excellent hedge for the portfolios of investors. Thus, gold becomes all the more valuable for its unique properties that never spoil and convenience to use as hedge against inflation.
Ever since man started to mold precious metals to serve as a form of currency, there have been equivalents for gold. How many pigs you could buy for a certain quantity of gold has changed over time. And even today, we may not actually use gold to buy items but many countries and regions around the world still use gold as a relative standard for currency equivalents. And always remember that not only the super rich can invest in gold coins or other gold investments. If you have enough savings to buy gold items, you can buy a little each time and treat this investment like cash in your bank account. Whether you want to cash in and sell gold coins in your closet may come down to how many twinkies you need.
Sell Gold Coins
The Gold market has gone crazy. You think, maybe I should cash in those gold coins I have stashed in the shoebox in the attic, or in my case, tucked neatly away in a safety deposit box. Whether or not you decide you want to sell gold coins will be determined by several factors including how much is gold worth, do I think the price of gold will go up or down, and the purpose of holding gold.
How much can I Sell Gold Coins For?
First you have to start with a gold coins value. How much are they worth? The value of Gold coins can be divided in two: Bullion gold coins and Collectable Gold coins. Let us start with Bullion Gold Coins. These are the commonly held Gold Coins that you have seen advertised. The list includes the South African Krugerrand, the Canadian Gold Maple Leaf and the American Eagle. They are valuable not because of their face value but because of the value of the precious metal contained in the coin, it is the same with Gold as with Silver. The value of a gold bullion coin is really the value of the metal plus a premium for the supply and demand of the coin itself.
In general, these type of Gold coins are considered legal tender, the Krugerrand being the notable exception, but the face value is much lower than the value of the precious metal. For example the Gold Double Eagle has a face value of $50, but the current value of the coins are in around $1650’s, a considerable difference between the legal tender value and the previous metal value. A few years ago the American Buffalo Gold Coin was introduced, also with a $50 face value but reminiscent of the “Buffalo Nickel” coin from the early part of last century. The Krugerrand was the first modern, low cost, bullion coin. It was introduced in 1967 and contained one troy ounce of gold. It still commands the lowest premiums in the market. The premium amounts range from around 2% for the Krugerrand to higher than 5% for the American Gold Eagle.
Collectable Gold Coins
In the United States prior to 1933 gold coins were minted and released into circulation. That is people actually used gold coins in the market place. By 1933 possession of Gold in the United States was outlawed in an effort to prevent gold hording. Prior to that time Gold coins were used in circulation. These gold coins are valued based on their gold content, of course, but also have a numismatic premium associated with them. This additional value is based on rarity of the coins. That is a large quantity have survived the premium will be lower, if relatively few have survived until now, then the premium can be quite large.
Criteria for valuing Collectable Gold Coins
The criteria for valuing non-bullion (collectable) Gold coins is simple.
1) Type of Gold Coin
2) Year
3) Mint designation
4) Condition of coin
All these factors combine to tell you whether or not your coin is rare and therefore more valuable, or commonplace and less valuable.
To assess the value of your collectable gold coins you will need to either have them appraised or value them using some sort of online grading website like Professional Coin Grading Service (PCGS.com) This helps you determine a current value for the year and mint of your gold coin. You will need to pay a fee to get full access to their site, but the information can be invaluable if you have value more than a coin or two. A lower cost solution is the one I used when I was growing up: buy a coin collector’s book. There is the Official Red Book: A guide of United States Coins which retails for around $10.
How to Sell Gold Coins?
There are numerous ways to sell Gold Coins now. Traditionally you would need to go to a coin dealer or company that bought and sold gold coins. Now there numerous online and offline options including such old Faithfull’s as Ebay and Craig’s list. They are just a couple of the online additions to the auctions and brokers who have traditionally handled Gold coin sales. eBay even has a section called the Bullion Center. Another way to Sell Gold Coins is to go the American Numismatic Association (money.org) and search for an ANA dealer in your area.
Maybe you inherited a gold coin from your grandfather and you have no idea if it is worth anything above the price of gold that day. If you want to properly sell gold coins, you will need to do some research if you want the best price.