Bullion Products vs. Rare Coins

When one goes to invest there are many choices, however, all investors should be aware of any opportunities risk to reward ratio. A risk to reward ratio compares the risk one takes with their money to the reward one can receive. When Wall Street evaluates a stock's reward (high selling price) versus the risk (low selling price) they're referring to a 12-month movement, which seems optimistic to the editors of this report. So we have examined risk to reward ratios for gold bullion and rare coins since 1980.

The future is just a speculation; so long-term trends can help to identify patterns and probabilities. Based on twenty-five years of price movement, most high-grade rare coins are 200-400 percent below their historic high price. While bullion products lag with 0 per cent historical ($850.00 high) upside, this is based on a current spot price of $850.00 also (changes daily). With the twenty-five year low price of bullion at $252.00 or 70 percent below current levels, your profit to risk ratio is less than one-to-one. Even a common year widely traded MS65 Saint Gaudens has a 5 to 1 risk to reward, favoring profit. Currently selling around $1550.00 (changes daily), with a 25-year high of $3900.00 and a low of $918.00 your upside potential is three times greater (3 to 1) then your risk. CGE offers population reports and risk to reward ratios on all products offered. In the current cycle, both bullion and certified coins should surpass their historical highs when adjusted for 25 years of inflation.

In an independent university study of gold investors, over 47 percent of those asked felt that bullion was more profitable than rare coins. Many investors fail to notice a few points on rare coins and the law of supply and demand, so we have listed seven reasons the returns can be impressive.

First. Unlike bullion, US rare coins have a fixed supply since 1933, when the government melted over 90 percent of coins originally produced.

Second. Apart from strong investor demand, there are two million collectors of U.S. rare coins, and when gold is rising, more people become interested in the hobby as well as investors seeking to leverage potential profits.

Third. Since rare coins are heirlooms as well as private items of wealth transfer, many coins pass from generation to generation, thus removing them from the market.

Fourth. Older investors remember the recall of gold bullion from 1933 - 1973 and prefer a true hedge to potential financial disaster.

Fifth. Major gold exchanges worldwide spend millions of Dollars to promote the profitability of a small supply of US rare coins.

Sixth. Rare coins are antiques. In the last twenty-five years can you think of any antiquities that dropped in price or increased supply?

Seventh. With independent certification from Professional Coin Grading Service and Numismatic Guarantee Corporation you have complete liquidity and the exact populations of your coins, a major advantage when dealing with the laws of supply and demand.

If you still have questions about the most suitable form of precious metals for you, then call one of our specialists today. When you call, we will evaluate your needs and recommend what fits your objectives, which may be a mixture of bullion and certified rare coins.