Buying & collecting gold coins

Tidybuoy · 12:51 PM

I was thinking that I might get some gold Kruggerands and maybe some other gold coins. My thought is that if I were to start collecting something or start a new hobby, I might as well buy something that has and will keep value.

Anyway, I was looking at Kruggerands on eBay and I was surprised to see such a variance in price for a one oz coin - ranging from $900 to $1500

So, if the price of gold is currently at about $930, what would drive the price of the coin up to $1500 or is this a special collectible coin or is this seller just taking advantage of people that don't know any better. I noticed that many coins sold are descrived as "uncirculated" and others are just plain old gold.

I believe, but I'm not positive that kruggerands were started in the '70's. So it could be an interesting goal to collect one of every year & maybe 1/10, 1/2, and 1 ounce coins - money permitting of course.

When I was in high school, my friend's dad was an eccentric doctor who was always preparing for the end of the world - even had a stocked bomb shelter. He was an avid gold coin collector and had, literally, hundreds of pure gold coins - many of them Kruggerands.

So I was thinking that someone on this board might have some advice.....

Rot 911 · 09-10-2009, 01:00 PM

My experience is you get better deals from local coin shops. That is where I buy all my gold coins.

nota · 09-10-2009, 02:01 PM

personally I like silver better
as I can see trading a silver dollar [old style big one]
for a can of soup or something else I need
much better then a near $1000 oz of gold
if everything goes real bad

many more silver coins out there too

that said I do have a few gold coins
but they were my mom's charm bracelet
and are keep for that reason alone

on2wheels52 · on2wheels52's Garage

"if the price of gold is currently at about $930, what would drive the price of the coin up to $1500 or is this a special collectible coin or is this seller just taking advantage of people that don't know any better."
Spot gold was in the $990's today. My take is the Kruggerand sell for the least of the one ounce coins; I sell them for $20 over (spot). A US eagle would go for $40 over, I guess that isn't a whole lot more, %age wise. I don't know why a Krand should sell for $1500, maybe I don't know how to market them.
Jim

Tidybuoy · 09-10-2009, 08:05 PM

Quote:

Originally Posted by on2wheels52

My take is the Kruggerand sell for the least of the one ounce coins; I sell them for $20 over (spot). A US eagle would go for $40 over, I guess that isn't a whole lot more, %age wise. I don't know why a Krand should sell for $1500, maybe I don't know how to market them.
Jim

Here's an example of one coin being offered at $1,350 but nothing special about the coin....why the pemium. I will definately look at our local coin shop.

Also, while the Kruggerand may sell for less than the US Eagle, I think Kruggerands do well because its unique in that it is the only coin that has a full oz of pure gold where the others weigh and exact oz but have slightly less gold due to the alloys.

Quote:

Originally Posted by nota

personally I like silver better
as I can see trading a silver dollar [old style big one]
for a can of soup or something else I need
much better then a near $1000 oz of gold
if everything goes real bad

many more silver coins out there too

that said I do have a few gold coins
but they were my mom's charm bracelet
and are keep for that reason alone

I'd say you have a good point but if it was difficult to use a 1 oz coin, then it would be better for me as I would be less likely to spend it or give it away. But nothing wrong with collecting both.

vangndy · 09-10-2009, 08:18 PM

www.bulliondirect.com

on2wheels52 · on2wheels52's Garage

"I think Kruggerands do well because its unique in that it is the only coin that has a full oz of pure gold where the others weigh an exact oz but have slightly less gold due to the alloys."

Are you thinking about the pre-1932 US $20 gold pieces? They weigh less than an ounce of au. But neither the Krand or the Eagle weigh a troy ounce, they're 22 dwt. They contain that ounce of gold but it's a 90% alloy, thus the 10% extra weight. If you're after purity the Canadian Maple Leaf and the Chines Panda are .999, and some others also.
Jim

Tidybuoy · 09-11-2009, 09:09 AM

I was under the impression that the kruggerand has 1 troy ounce of pure gold with additional alloy to give it strength. As a result, a Kruggerand is slightly larger than other gold coins.

http://en.wikipedia.org/wiki/Krugerrand

From Wikipedia:
The Krugerrand is 32.6 mm in diameter and 2.74 mm thick. The Krugerrand's actual weight is 1.0909 troy ounces (33.93 g). It is minted from gold alloy that is 91.67% pure (22 karats), so the coin contains one troy ounce (31.1035 g) of gold. The remaining 8.33% of the coin's weight (2.826 g) is copper (an alloy known historically as crown gold which has long been used for English gold sovereigns), which gives the Krugerrand a more orange appearance than silver-alloyed gold coins. Gold alloy coins are harder and more durable, so they can resist scratches and dents.

pwd72s · 09-11-2009, 11:13 AM

Bottom line...these are NOT collectables...their price will fluctuate with the price of gold. Not that there's anything wrong with buying some if you wish to have gold...but do realize they are not a collectable coin in the sense that coin collectors use.

Joeaksa · 09-11-2009, 11:21 AM

You should have started this years ago.

Have some gold from the years we spent overseas (always had some to use in an escape if needed) then when my Father passed a number of $10 and $20 gold coins came my hands.

Hope that I never need to use them...

Joe A

Tidybuoy · 07:22 PM

Quote:

Originally Posted by pwd72s

Bottom line...these are NOT collectables...their price will fluctuate with the price of gold. Not that there's anything wrong with buying some if you wish to have gold...but do realize they are not a collectable coin in the sense that coin collectors use.

That was kind of my initial point. I want to collect some of these coins just as a way to stash some money and do it in a way that would be some fun - like collecting. But not as a collectable, just as a hobby. Basically, all my jars are full of quarters, dimes, and nickels and now it'st time for a jar of gold.

So, this is why I was wondering why some one ounce kruggerands are selling near the price of gold ($950ish) and some are selling for ($1,500) and yet there's not much difference in the coin. Maybe the seller of the $1500 is banking on the fact that inexperienced coin buyers are out there. And if I'm really smart, I will go to a coin store and buy one coin for $1k and immediately list it on eBay for $1.5k - it could work.

This is why it's sometimes good to be poor. I have plenty of time to look into it before plunking down a grand +.