Investing in Precious Metals: Bullion vs Numismatics
A key part of investing in precious metals is knowing the difference between bullion and numismatics. It all boils down to how a person (that’s you) perceives its value. Are you purchasing precious metals purely for their commodity value or are you purchasing precious metals mostly for their collectability?
To uncover the complete answer to the question, “What’s the difference between bullion and numismatics?” We will provide a little more explanation.
What is bullion?
Bullion is a highly pure (.999+ percent pure) precious metal that can be sold to investors who gauge the product’s value purely on the content of the gold, silver, platinum or palladium.
Bullion can be purchased in bars or coins in a wide variety of sizes, from one-gram coins up to one-kilogram bars (and more). Bars can be cast or minted, and often include simple design elements: the mint’s logo and basic bullion content on at least one side. Popular bullion coins include the U.S. Mint’s Silver Eagles, the Royal Canadian Mint’s Gold Maples and the South African Mint’s Krugerrands.
The simplicity and uniformity of bullion ensure that there is always a large market of buyers and sellers around the world.
What are Numismatics?
Numismatics refers to collecting currency, and in this topic specifically, that would mean collecting coins. Numismatists are collectors who see beyond the metal weight and purity and want to obtain precious metals for other reasons. This also often leads to the price of a numismatic coin being more expensive than bullion.
The reasons for collecting gold, silver, platinum and palladium coins can be quite varied, depending on who is doing the collecting. Some collect older coins for their historical value – the writer of this article would like to start a collection of historical coins beginning with the 1794 Flowing Hair Dollar. Many older coins are tarnished, have faded designs and have lower purity, but collectors do not mind as much since they consider many other aspects of the coin to also have value. Some coins are collected purely for their sentimental value (the year they were produced, the location of the mint or the theme of the design.) Some collectors see additional value in the beauty of the numismatic coin designs, some being collectable purely for the cultural occasion the coin celebrates, the royal figure’s effigy or a mint’s “minor” error.
Since rarity is often a key component in the value of numismatic coins, they can be more difficult to buy or sell at the price you want.
But Can Bullion Buyers Also be Collectors and Can Numismatists Also be Investors?
The waters can be muddy on this issue – they sure can. Some investors who buy bullion want to collect sets of bars, or specific bars or coins from mints for particular reasons, while collectors can also buy their coins for their future value.
Both bullion and numismatic coins can be great investment opportunities. Both can be collectable. They both can give you great joy. Whether you are collecting, investing or just having some fun, check out the bullion and numismatic products available to Canadians right here on www.RoyalBull.ca/shop.