King Croesus, ruler of the Kingdom of Lydia in western Asia Minor (latter-day Turkey) from 560 to 546BC, struck the first gold coins in history. The king minted gold brought from his own mines and the sands of the River Pactolus. Gold coins have been a recognised form of legal tender ever since.
Bullion coins and small bars offer private investors an attractive way of investing in relatively small amounts of gold. In many countries - including the whole of the European Union - gold purchased for investment purposes is exempt from Value Added Tax.
Bullion coins
Investors can choose from a wide range of gold bullion coins, issued by governments across the world. In their country of issue, these coins are considered legal tender for their face value, rather than their gold content.
Alternatively, the market value of bullion coins is determined by their fine gold content, plus a premium or mark-up that varies between coins and dealers. Of course the premium tends to be higher for smaller denominations.
Bullion coins may range in size from 1/20 ounce to 1000 grams, although the most common weights (in troy ounces of fine gold content) are 1/20, 1/10, 1/4, 1/2 and 1 ounce. It is important not to confuse bullion coins with commemorative or numismatic coins, whose value depends on their rarity, design and finish rather than on their fine gold content. Many dealers sell both.
Visit industry specialists Gold Bars Worldwide’s website for additional information regarding gold bullion coins.
Small gold bars
Gold bars can be bought in a variety of weights and sizes, ranging from as little as one gram to 400 troy ounces (the size of the internationally traded London Good Delivery bar). The definition of a small bar is one that weighs 1000g or less.
According to industry specialists Gold Bars Worldwide, there are 110 accredited bar manufacturers and brands in 28 countries. Between them they produce a total of more than 500 types of standard gold bars, all of which normally contain a minimum of 99.5% fine gold.
Visit the Gold Bars Worldwide website for additional information regarding the international gold bar market.