Although gold coins have been used since thousands of years in our society but it is a different story when we invest. In banking and investing terms, a gold coin refers to hallmarked gold medallion of generally a round shape. Gold is bought widely in India but mostly as jewellery which do not make the investment. You lose money on the making charge.
Investing in gold coins for long term is one of the best and simplest investments you can do. There are some things you should before you go for a gold coin.
For investment, the coins are standardized as either 22 karat or 24 karat. The jewellery standards may not apply here so do not buy coins which are not 22 or 24 carat.
Coins are made in India with various deities and designs. It is better not to go to such fancies as with more designs, the more making charge is put on the cost. But when you sell it, you will only get the cost of gold and the making charge is a loss for you. Many investors prefer to take gold bars to get rid of this making cost but it is only possible if your investment is bigger.
Generally coins start from 0.5 g up to 100g. Standard range of coins is 1g, 2g, 4g, 8g, 10g, 25 g, 50 g and 100 g. An 8g coin is termed as a guinea. Gold bars come in higher denominations.
Buy hallmarked gold only for your investment. Every standard gold coin seller will provide it.
Buy and sell coin
You can buy coins from the jewellery store and also from some banks and brands selling it online. Gold coins can be sold back to the jewellery stores. Banks and the online sellers may or may not buy back, check terms and conditions for each organization before buying.
What to do
You can buy and use the gold later to make jewellery. If you want to sell it, keep it at least for three years so that you get a good return on investment.
Gold prices except for minor cases always go up in the long term. It is said that gold is security against inflation. If you want to plan to save for a marriage, buy gold coins instead of jewellery which can be made into jewels or used for cash.
Investment and collection
Please note that gold coins for investment are different from a collector’s gold coin. A collector’s can be old and engraved. However investment coins will be purity hallmarked. Two coins of the same gold weight will have different market value.
How to keep
Please keep your gold coins as an investment, properly wrapped and in bank locker. Keep the invoice/certificates safely that you might get with it. This will help you in future to calculate your Return on investment.