Gold Coins

September 10th, 2008 at 07:33am Under Uncategorized

Gold coins are one of the oldest forms of money. The first gold coins in history were coined by the Lydian king Croesus in about 560 BC, not long after the first silver coins were minted by king Pheidon of Argos in about 700 BC. The Ying Yuan was a gold coin minted by the Chinese in the 6th or 5th century BC.

Gold coins then had a very long period as a primary form of money, only falling into disuse in the early 20th century. Most of the world stopped making gold coins as currency by 1933, as countries switched from the Gold Standard due to hoarding during the worldwide economic crisis of the Great Depression. In the United States, this was following Executive Order 6102.

However, gold-coloured coins (not made of real gold) have made a comeback in many currencies. Furthermore, many countries continue to make legal tender gold coins, but these are primarily meant for collectors and investment purposes and are not meant for circulation.

Krugerrand

Canadian Gold Maple Leaf

American Gold Eagle

Bullion coins

While obsolete gold coins are primarily collected for their numismatic value, gold bullion coins today derive their value from the metal (gold) content - and as such are viewed by some investors as a “hedge” against inflation or a store of value. South Africa introduced the Krugerrand in 1967 to cater to this market; this was the reason for its convenient and memorable gold content—exactly one troy ounce. It was the first modern, low premium (i.e. priced only slightly above the bullion value of the gold) bullion gold coin. Bullion coins are also produced in fractions of an ounce – typically half ounce, quarter ounce, and one-tenth ounce. Bullion coins do not carry a meaningful face value, as their value is mainly dictated by their troy weight and the current market price of the precious metal. (If a face value is minted on the coin, it is done for legal or other reasons and it is nearly always significantly less than the actual value of the coin.) Gold has an international currency code of XAU under ISO 4217.

Gold bullion coins usually come in 1 oz, 1/2 oz, 1/4 oz, 1/10 and 1/20 oz. sizes. Most countries have one design that remains constant each year; others have variations each year, and in most cases each coin is dated. A 1/10th oz bullion coin is about the same size as a U.S. dime. A 1 oz. gold bullion coin is about the size of a U.S. half dollar.

Counterfeits

For most of history, coins were valued based on the precious metal they contain. Whether or not a coin was actually made by the party that it is claimed to be made by was of secondary importance compared to whether or not it contains the correct amount of metal, that is, right weight and fineness (purity). Genuine appearance was simply a convenient shortcut to avoid time-consuming tests in everyday transactions.

Unlike silver, gold is denser than almost all other metals, whether something is made of gold is extremely hard to fake. Simple determination of weight and volume should be sufficent. A coin that is the right size but is not gold, or has too much base metal, will be “light”; alternately, a coin that weighs right will be somewhat larger. (Platinum was unknown in ancient times; platinum is denser than gold, but since it is about twice as expensive, making a fake coin out of platinum would make no sense. In theory, fake coins could be made of uranium, but this does not appear to be a practical problem.)

Of course, if a coin has mostly numismatic value, whether it is authentic is critical. A coin that is not genuine would (assuming it is made of gold) have the same “melt value” as a genuine coin, but this may be next to nothing, relatively speaking, for a rare coin.

There are well made counterfeit gold coins in circulation. For example, the Saint-Gaudens Double Eagle omega counterfeit is infamous for its complexity; and has fooled many numismatics experts. It is a high relief business strike, and due to the extensive wear on the die, these coins were not made for many years. For poor counterfeits, a good scale can usually tell if it’s counterfeit or not; however, there are many well made counterfeited ancient coins that not only use gold, but the correct amount as well.

The US $20 gold coin (”double eagle”) has raised lettering around its rim. If the coin is uncirculated, the letters will be flat on top. If slightly rounded, and the coin is uncirculated, it is a counterfeit. However, some counterfeits do not have this defect.

There are other counterfeit double eagles in which the gold and copper alloy was not thoroughly mixed. These counterfeits will have a slightly mottled appearance.

An old practice to test whether a gold coin was counterfeit was to bite down on it. Since pure gold is relatively soft any base metals mixed with the gold to lessen its value will also harden the coin, and so make it harder to bite on. The majority of bullion counterfeits (of all types) are rare, and fairly easy to detect when comparing their weights, colors and sizes to authentic pieces. This is because the cost of reproducing any given coin precisely can easily exceed the market value of the originals.

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Cleaning Your Coins

August 10th, 2008 at 08:26pm Under Maintaining Coins

In most cases, you usually do not clean a coin. For most coin collectors, the original state of the coin is the most valuable state. They would rather see the wear on the coin than to clean it and destroy what was created naturally.

However, if you really want to clean the coin for your personal satisfaction, stay away from jewelry cleaner, or metal polishes. Also refrain from using a tarnish cleaner; it tends to remove the toning that forms over the coin over time. In some cases, these abrasives can leave spots and scratches which lower the overall value of the coin.

Always make sure that if you are going to clean your coins, take them to a professional who’s an expert in coin cleaning. These professionals use a method which is known as dripping; it’s not for a novice cleaner though. If you attempt it and do it the wrong way, you could cause more harm to your coin then expected. Also remember to hold your coins by the edges to prevent any unwanted fingerprints on the surface.
If one of your coin happens to have wear and tear on the delicated details, date, etc of the coin, always consult a professional. They often have solutions for these sort of problems.

Also remember, that if you are going to clean your coins, always attempt all your techniques on coins that have less value, as compared to those that are of greater value. This way, even if you damage your coin, you’ll end up losing less as opposed to more.

Follow these tips and you’ll find it easier to protect your valuable investment. If you damage your coins in the process of cleaning, you could end up with nothing but a coin that has no value.

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Get To Know Your Coins

August 9th, 2008 at 08:02pm Under Collecting Coins

Collecting coins is a popular hobby. People from all over the world collect coins and also pay a decent amount for various coins. Here’s a few things you should know if coin collecting happens to be your fashion.

How will you determine that you are getting the coin you are paying for? A few of the antique coins often cost a decent amount of money, but you have to ensure that they are worth that amount. A coin grading system is mostly used to price coins, be they old or new.

Finding the price of new coins is relatively easy, as compared to old coins. You have to research about the old coins before you make a decision. Since these coins are often NOT available in the market, you need to analyse their condition, etc. Local libraries may be a good place to find books related to old coins and also those that are available in the market. You can also use the internet for your research work.

Contacting coin experts is a good idea. You can compare their valuation of the coins against yours and notice the difference. Local coin shops or the internet is a good place in case you need to find their contact details.

Keep these few points in mind. They will definitely help you to buy your favorite coins at the right price.

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How To Find Rare Coins

August 8th, 2008 at 10:43pm Under Collecting Coins

Amateur coin collectors often hope to stumble upon rare coins while engaging in their hobby; but, it does not work out this way. There are many rare coins circulating throughout the world; despite this, professional coin collectors often dedicate their lives to this hobby, while some of them also take it on as a business. Ofcourse, this does not mean that it is impossible to find a rare coin in your daily time. But it takes practice, a good eye, and patience!

Pocket Change… Save All Of It!

This may sound stupid, but make it a habit to save all the change you get in your daily life. Luck can strike anywhere, so why not give that usual pocket change a chance? Keep all your change in a jar. This increases the chances of actually finding something precious. Every so often, examine that change you’ve been putting in that jar. Look at each and every coin closely; make it a habit. You won’t just get the precious stuff out of nothing.

Research Is The Key!

The web has a plethora of information on anything and everything. The same applies to coin collecting. If you actually find something out of the oridinary and want to know whether it is worth a fortune, visit the web for guidance. A valuable resource is www.acoins.com . Another one you could visit is www.coinresource.com. Both of these sites have lots of information that can be especially helpful for the begginers.

Some of the more basic stuff that you should keep an eye for when trying to determine that ‘rare’ coin is mistakes, doubling, etc or anything that is apart from the usual. If you feel that your coin is something different from the ordinary, always research on it to determine how valuable the coin is.

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Collecting Coins

August 8th, 2008 at 10:24pm Under Collecting Coins

Coin collecting is one of the most popular hobbies today. It is a fun pastime that anyone can enjoy.

The presumtion of the hobby is that certain coins are worth more than many others. People who are amateur collectors tend to save coins that date back several decades.

Coin collecting is mainly popular among children and the young, however quite a few adults also enjoy it. Most of these people often collect old coins or coins from different countries. They don’t do it for the value, but to keep it and show others.

Amateur coin collectors often save a coin from every country they travel to. They find these different coins interesting and over time they manage to compile an overwhelming collection.

There are a few other people who collect or save only those coins that hold some meaning to them. These could be coins from the year they or their parents/siblings were born, etc. This form of coin collecting is a tribute to the person’s life and can be held as a souvenir to pass on to the future generations.

For some collectors, serious coin collecting holds great importance. They often invest a great amount of money and time to keep up with this hobby. Collectors often concentrate on a specific aspect. Some of them are looking for coins from a specific timeframe, while others hunt for coins in specific denominations that are often rare.

A coin collector can find new coins in many places. There are many online auctions that are targetted at coin collectors. They have pictures of the coins along with the description and price.
These sites often have a large variety of coins posted from different sellers all over the world, and this gives the collector the opportunity to choose exactly what they like.

The misconception that surrounds this hobby is the thought that someone who wants to engage in it has to be wealthy. This is not entirely true. Although there are some very costly coins out there, begginers can indulge in this hobby on a relatively low budget to begin with.

Coin collection is a fun hobby, and a profitable one too. You can always start low and grow later on.

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