Brands, Branding, Commodities & Gold Investment Gold Coins
Krugerrands, Sovereigns, Maples, Nuggets, Eagles, Philharmonicas are all examples of brands of investment gold coin, but it makes no sense to pay a higher premium for a commodity.
Traditionally, branding was a way to increase the market share or price paid for a consumer item, through perceived higher quality or consistency. In recent times, branding has become paramount in consumerland. Young and gullible people are targeted by marketing campaigns to establish premium price brands. To be seen wearing or consuming a non-premium brand has become a social faux pas among the mindless mass of fashion victims.
Branding is the opposite of commoditisation.
The Role of Branding in Investment Gold
Among international and central banks, the most commonly accepted standard of gold used as a commodity or money is the "London Good Delivery Bar". Many different refiners produce these, and the "brand" is only important in that it is known to conform to the LBMA's standards, or fails to conform. These bars are almost useless for the private investor, firstly because of their size, and secondly because they are variable in actual individual weight between 350 and 430 troy ounces. Most small investors would find this very confusing and undesirable. Large institutions may transfer ownership of hundreds of bars at a time, and would carry any small balance (up to 400 ounces) as a paper entry.
Similarly, in the "small bars" market (anything smaller than 400 ounces, usually one kilo and smaller), the actual refiner is usually not considered to be of the highest importance, only the fact that the refiner or promoter is recognised and universally accepted.
Consumerism and Collectability
We fell that brands and branding have increased their stranglehold on the mind of the consumer, who has become brainwashed to the extent that if he has not seen a product advertised on television or in a glossy magazine or newspaper, that ergo it cannot be any good. We also feel that as consumers have been increasingly spoonfed, their reliance on their own judgement has diminished or disappeared completely, and that reliance on the assurance of buying a brand has become a substitute for individual judgment..
Paying too much when purchasing an investment is counter productive. Much of our gold investment advice boils down to paying as little premium as possible, within reason. By all means buy a brand of gold coin or bar if, as an investor, it is not costing you any more (or at worst only a tiny premium), otherwise avoid buying a brand when buying what should be a commodity.
Collectors & Aesthetics
We are aware that a number of people enjoy collecting different designs and types of gold coin and gold bar. In this case, it's only to be expected that obtaining the item of your choice will almost always cost you a higher premium or price. Some bullion coins are very collectable.
We are flexible enough to be able to help the collector as well as the investor, and we are also well aware that some people combine investment and numismatics.
We have just mentioned that some people buy gold purely as an investment, others as a collectable item, and that there are some people who combine both aspects. This creates a kind of "crossover" market between investing and collecting. We try to meet the needs of all three types of buyer.
It's also worth looking at our August slowdown page.
The corollary to this page.
You may wish to look at our gold investment advice page.
Please be aware that for callers to our showroom hoping to buy Investment Gold we must see two forms of identification. Please see our identification page for further details.
There are now live spot gold prices available on this website, please see our gold prices page.
Gold - Your Flexible Friend