In the ancient times, gold served an important role in the cultural and economic lives of people. Thanks to its beauty, rarity, and excellent malleability, gold became a very popular material in the creation of jewelry and art pieces that adorned both people and edifices across time and cultures.
Gold was also used in the production of coinage, which became a primary medium of exchange in many countries. In the Modern Era, gold standards were even implemented as monetary policies within nations, helping create currencies of stable value.
Nowadays, the precious metal continues to be popular as a primary material in the production of personal ornaments. On top of this, gold is also used in a spectrum of other applications, with industries as varied as dentistry, electronics, aerospace engineering, and medicine taking advantage of the useful properties of the metal. Gold also plays a role as a commodity in the contemporary global economy.
Gold is often purchased by people as a means to diversify their wealth and as hedge against inflation. Physical gold comes in the form of bullion bars, bullion coins, and numismatic coins. We often hear about these different products, but what exactly are they? Find out by reading this short guide:
Gold Bullion Bars
Also known as gold ingots, gold bullion bars are produced by bar makers according to specified standards and conditions of manufacturing. The bars typically come in various sizes and weights. For instance, Europe’s Good Delivery bullion bars — known for their huge size and high level of purity — are manufactured as 400-troy-ounce or 12-kilogram bars. They are usually used in the gold reserves of governments and are traded in major international markets. People can also buy smaller bullion bars like those weighing 1 kg, 100 g, 10 oz, and 1 oz.
Gold Bullion Coins
Buying gold bullion coins is one of the most popular ways to own gold. Bullion coins are sold at cost according to their purity and fine weight, but there is a small premium based on their design, provenance, and external factors like supply and demand.
Gold bullion coins typically have purities of no less than 900 thousandths, and they are also available in different weights, usually as fractions of 1 troy ounce. Some of the most popular varieties include the American Gold Eagle, the Canadian Maple Leaf, the Australian Gold Nugget, the British Sovereign, the South African Krugerrand, and the Austrian Vienna Philharmonic.
Gold Numismatic Coins
Unlike gold bullion coins, gold numismatic coins are priced primarily according to supply and demand, which is based on the coins’ unique characteristics. The factors that can affect their price include the coins’ historical value, their rarity, their design, their age, their condition, or some other unique quality. Historical gold coins that are no longer produced today are a primary example of numismatic coins.
When it comes to pricing, numismatic coins’ actual gold content is not as important as it is with gold bullion coins; numismatic coins are typically priced higher than the base value of gold itself.
While no longer used as a currency, gold remains as valuable today as it was in the past. It is a precious metal that will outlive many generations and will continue being a popular repository of wealth for many years to come.
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