Gold? Sovereigns / Small bars, does source matter?
Discussion
Thinking of putting a small amount of savings into Gold, a) for a bit of financial spreading things out, and b) just because.
Looking on the bullion sites, there's an awful lot of different sources / names / countries / manufacturers. I thought Gold was Gold - does the name attached to it make it more or less valuable when it comes to resale? Are there some countries to avoid?
Thoughts? Thanks.
Looking on the bullion sites, there's an awful lot of different sources / names / countries / manufacturers. I thought Gold was Gold - does the name attached to it make it more or less valuable when it comes to resale? Are there some countries to avoid?
Thoughts? Thanks.
There's a difference in taxation rules depending on the type and source - for example Gold Sovereigns are exempt from capital gains tax because they're deemed to be legal tender in the UK, whereas Krugerrands are not, so if you bought them and had a big jump in value, it's taxable.
There might well be more to it than this.
ETA - not sure about bullion specifically, thought it was a generic gold question rather than specifically bullion.
There might well be more to it than this.
ETA - not sure about bullion specifically, thought it was a generic gold question rather than specifically bullion.
First, look at the gold content. Sovereigns are 22 carat which is 22/24 gold and the rest thing like silver and copper. Other coins will be different. Gold investment bars could be 995 i.e. 995/1000 gold or 9999 gold which is 9999/10000 gold or as pure as you can get.
Go on the internet and find a live gold price. At the moment it is USD1263 per oz which is GPB982 per oz. To convert to a price per gramme divide it by 31.1035. Work out the value of the gold in the product.
Anything you pay above this is a premium for things like manufacturing, transport, storage and 'spread' or profit made by the dealer.
Look at the 'spread' between their selling price and the price they will buy it back for on anything you buy as you will find there is a big difference between the price you buy for and the price you sell for. It will be significant for coins and small bars and could well wipe out any profits. The condition of the gold will also affect the price they will pay especially for coins.
Coins which will generally have the highest premium due to the manufacturing process and numismatic value. Coined bars (i.e. stamped out like a coin) will be less of a premium and cast bars less of a premium again.
A more cost effective alternative is something like the Royal Mint Signature Gold or another similar product (often called ETFs). You buy and own the gold paying a much smaller spread but you don't physically hold it. That is done by the Royal Mint or other provider of this sort of service (your bank may offer a product like this).
Unless you actually want to physically hold the gold this is a much better way to trade gold.
Go on the internet and find a live gold price. At the moment it is USD1263 per oz which is GPB982 per oz. To convert to a price per gramme divide it by 31.1035. Work out the value of the gold in the product.
Anything you pay above this is a premium for things like manufacturing, transport, storage and 'spread' or profit made by the dealer.
Look at the 'spread' between their selling price and the price they will buy it back for on anything you buy as you will find there is a big difference between the price you buy for and the price you sell for. It will be significant for coins and small bars and could well wipe out any profits. The condition of the gold will also affect the price they will pay especially for coins.
Coins which will generally have the highest premium due to the manufacturing process and numismatic value. Coined bars (i.e. stamped out like a coin) will be less of a premium and cast bars less of a premium again.
A more cost effective alternative is something like the Royal Mint Signature Gold or another similar product (often called ETFs). You buy and own the gold paying a much smaller spread but you don't physically hold it. That is done by the Royal Mint or other provider of this sort of service (your bank may offer a product like this).
Unless you actually want to physically hold the gold this is a much better way to trade gold.
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