Gold Sovereigns Versus Krugerrands
Real Gold Coins at Similar Prices to Bullion Coins
We believe that for most investors, and for most of the time, sovereigns are a better buy than Krugerrands, other one ounce bullion coins, or gold bars. This advice does depend on changing market conditions, and the differential in premiums between the different coins at the time of purchase. At the time of writing, our best rate of Krugerrands was 4%, and our best rate on sovereigns was 5%, on quantities of 500 and 1,000 respectively, leaving a differential between them of only 1%. In our opinion, sovereigns should be worth at least 2% or 3% more than Krugerrands, so at current levels, sovereigns remain the better buy. For small quantities, however, we do charge a higher premium on sovereigns, 15% compared with 7% on single pieces, so for the smaller investor, we generally advise Krugerrands as the better buy. These premiums can change, so it is always worth checking the current premiums we have listed on our sovereigns and Krugerrands pages.
Historic Price Comparisons
During the last quarter of 1999, our quantity buying price for Krugerrands was 4% premium, and for sovereigns 10% premium. This may help to put the current premiums into perspective, and we believe these prices are a truer representation of the "correct" relative values.
Another guide may be to look back further in time. From memory, in the 1960's sovereigns were trading at a premium of about 40% over the value of their intrinsic gold content, although we must admit that our recollection is now a little hazy after this length of time.
Other World Coins