Gold Coins: Is It Time To Buy or Sell?
Are gold coins at a good price? Even though you see more about gold in the press, you get mixed signals. You see ads try to sell you gold coins. Then you see ads offering to buy your gold. Which is it? Buy gold or sell your gold?
Like anything else, it really depends on how much gold, if any, you have now. I'm not saying this to be cute or coy. I'm saying it to reinforce a really important point. To make good decisions regarding your money, you've got to make decisions that fit your own specific circumstances. I'm usually leery of most "one size fits all" investment recommendations.
With that said, let's get back to gold. If you hold gold right now and are comfortable with how much you hold, don't start selling now. We're just getting out of an extended correction in the price of gold. Maybe you sold your gold. If you did, it was probably a mistake.
Why a mistake? Well, if gold is in a true bull market, as I think it is, then why would you sell during a correction? Actually I know the answer. In bull markets, people are always scared out of their positions during corrections. Think of it this way: the bull always tries to shake you off his back.
If, on the other hand, you don't own any gold, this might be as good a time as any to buy some. (I'm not getting into any more specifics right now. Maybe in a later post.)
If you want to buy gold coins, then, as with any purchase, you have to do a little shopping. Go to at least 2 or 3 sources and get a price for gold coins. Unless you're buying hundreds of thousands of dollars of gold in one shot, coins are probably your best bet to get started.
Don't buy "numismatic" coins. These are "collectible" coins. You have to have a lot of knowledge about the specific coins, just like you'd have to have a lot of knowledge if you were collecting anything else, like, let's say, stamps. Most of the ads you see are for numismatic coins. Unless you are a knowledgeable coin collector, you won't know whether you're buying that particular coin at a good price.
If you just want to invest in gold itself (as opposed to some specific collectible coin), buy "bullion" coins. These are generally priced close to their weight in gold, whereas numismatic coins are priced with a premium depending on their quality and rarity.
You can easily buy gold or silver coins from coin dealers. If you have a dealer nearby and want buy in person, go ahead. Buying on the internet is now a more common way to buy theses coins. Just be certain you know and trust the dealer. If not, you'll need some way to make sure what you're buying isn't some sort of fake or imitation.
For gold coins, which should be the core of your investment, you should strive to pay no more than 6% above the "spot" price. An easy way to find the spot price is to go to a site like www.kitco.com. Add 6% to the spot price and call (or visit) the coin shop.
The easiest and most common gold coins to buy are the 1 ounce coins. They have the lowest premiums. For gold, I see no reason to buy coins of a lesser weight - unless you don't have the cash to buy the 1 ounce coins.
We live in a time when most Americans have no real knowledge or understanding of gold, its history and its place in portfolios - never mind specifics like gold coins. This wasn't always the case. But it is now.
So I'm thinking that maybe a good idea would be to post more thoughts and information about gold in the future. I just don't want this blog to be one of those "gold bug" blogs. It's not meant to be that.
On the other hand, gold may be the single most mysterious item to most Americans when it comes to investing. And it really shouldn't be. Just promise me that you won't think I'm nutty if I start talking about gold here from time to time. If you promise me that, I'll post more on gold.
For now, just be careful when you respond to ads you see about gold. I've never heard of most of the companies that put out these ads.
And as for our original question about buying or selling gold coins, if you're going to consider gold as part of your holding, you should be pretty much thinking buying, not selling, at this point.
Like anything else, it really depends on how much gold, if any, you have now. I'm not saying this to be cute or coy. I'm saying it to reinforce a really important point. To make good decisions regarding your money, you've got to make decisions that fit your own specific circumstances. I'm usually leery of most "one size fits all" investment recommendations.
With that said, let's get back to gold. If you hold gold right now and are comfortable with how much you hold, don't start selling now. We're just getting out of an extended correction in the price of gold. Maybe you sold your gold. If you did, it was probably a mistake.
Why a mistake? Well, if gold is in a true bull market, as I think it is, then why would you sell during a correction? Actually I know the answer. In bull markets, people are always scared out of their positions during corrections. Think of it this way: the bull always tries to shake you off his back.
If, on the other hand, you don't own any gold, this might be as good a time as any to buy some. (I'm not getting into any more specifics right now. Maybe in a later post.)
If you want to buy gold coins, then, as with any purchase, you have to do a little shopping. Go to at least 2 or 3 sources and get a price for gold coins. Unless you're buying hundreds of thousands of dollars of gold in one shot, coins are probably your best bet to get started.
Don't buy "numismatic" coins. These are "collectible" coins. You have to have a lot of knowledge about the specific coins, just like you'd have to have a lot of knowledge if you were collecting anything else, like, let's say, stamps. Most of the ads you see are for numismatic coins. Unless you are a knowledgeable coin collector, you won't know whether you're buying that particular coin at a good price.
If you just want to invest in gold itself (as opposed to some specific collectible coin), buy "bullion" coins. These are generally priced close to their weight in gold, whereas numismatic coins are priced with a premium depending on their quality and rarity.
You can easily buy gold or silver coins from coin dealers. If you have a dealer nearby and want buy in person, go ahead. Buying on the internet is now a more common way to buy theses coins. Just be certain you know and trust the dealer. If not, you'll need some way to make sure what you're buying isn't some sort of fake or imitation.
For gold coins, which should be the core of your investment, you should strive to pay no more than 6% above the "spot" price. An easy way to find the spot price is to go to a site like www.kitco.com. Add 6% to the spot price and call (or visit) the coin shop.
The easiest and most common gold coins to buy are the 1 ounce coins. They have the lowest premiums. For gold, I see no reason to buy coins of a lesser weight - unless you don't have the cash to buy the 1 ounce coins.
We live in a time when most Americans have no real knowledge or understanding of gold, its history and its place in portfolios - never mind specifics like gold coins. This wasn't always the case. But it is now.
So I'm thinking that maybe a good idea would be to post more thoughts and information about gold in the future. I just don't want this blog to be one of those "gold bug" blogs. It's not meant to be that.
On the other hand, gold may be the single most mysterious item to most Americans when it comes to investing. And it really shouldn't be. Just promise me that you won't think I'm nutty if I start talking about gold here from time to time. If you promise me that, I'll post more on gold.
For now, just be careful when you respond to ads you see about gold. I've never heard of most of the companies that put out these ads.
And as for our original question about buying or selling gold coins, if you're going to consider gold as part of your holding, you should be pretty much thinking buying, not selling, at this point.
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