Coins fall into four main categories: bullion, proof, numismatic, and semi-numismatic. These four types of coins differ in how they are valued and each has distinct advantages and limitations from an investment standpoint. Important to note that numismatic coins are not allowed to be included in a gold or precious metals IRA; however, they continue to present a great option for investors considering to invest in precious metals from their funds outside of retirement accounts.
Bullion has a recognized weight and fineness and is stamped as such. Most people think that bullion only comes in “bricks” or bars that are stored in depositories, but bullion coins are made from this same type of precious metals each year, making them easier to own (a coin is smaller, and thus a less expensive investment, than an entire bar).
Proof coins are a higher quality coins than bullion and are made in relatively low quantities and feature a more reflective or cameo appearance. Proof coins are the finest quality of coin produced by the United States Mint. The term “proof” refers to the coin’s finish. Proof blanks are specially treated, hand-polished, and cleaned to ensure high-quality strikes.
Proof coins are struck using specially polished dies and are typically struck more than once or with significant pressure. The details of proof coins tend to stand out more and the field area may appear smoother than on a standard circulated coins because of the extra care taken in striking the coin. Further, proof coins are encapsulated to maintain its quality and prevent rust and are accompanied with a certificate of authenticity and presented in special packaging. The best example would be both the iconic American Eagle coins that come in gold, silver and platinum.
Numismatic coins tend to be older coins that have gained value among collectors. They are valued both for their precious metal content and their artistic or collector’s value. They must be independently certified by third-party services that grade them and provide some information regarding their value. Example of numismatic coins include the $5, $10 and $20 Indian and Liberty gold coins.
Semi-numismatic coins have both the traits of bullion and numismatic coins. Generally, semi-numismatic coins are newer bullion coins that have a limited mintage (total number produced) and are attractive to both investors and collectors. The Royal Canadian Mint produces special feature coins under its animal series coins. Over time, the value of a semi-numismatic rises above bullion due to its scarcity.
A well-diversified precious metals portfolio will include the above four types. Your Allegiance Gold coin expert will elaborate the benefit of each type of coins and guide you to choose the best options for your short and long-term needs.