Rare gold coins versus gold futures: deciphering the price difference for collectors and investors

By Michael McConnell

Gold has been all over the headlines lately, and with good reason. According to a recent

Market Watch

report, gold futures have risen more than 70% over the past four years alone. These values, in turn, have prompted broad interest in the purchase of gold bars and coins. However, there is a crucial difference between pricing

rare gold coins

and gold futures. When it comes to collecting coins versus purchasing precious metal shares, it is important to understand the varying factors that can influence market value. Also, as we have noted in past columns, rare coin collecting is rarely an appropriate method for solely building a nest egg. Those who choose to pursue coin collecting are most successful when they do so for the sake of education and entertainment, with lasting tangible value being one of several incentives for buying coins, as opposed to the collector’s primary goal.

Simply put, rare gold coins are not necessarily priced in direct accordance with gold futures. Even in the midst of gold’s meteoric rise in value, a rare 1909 piece that sold for $34,500 in summer of 2008 went for $23,400 last fall. Numismatists (rare coin scholars) ascribe instances like this 32% decline in value to the U.S. government’s increase in gold sales. In the wake of the recession, demand for gold and other hard assets prompted officials at the U.S. Mint to sell a wide variety of gold bullion coins. However, when buyers snatched up these Mint pieces, it may have reduced the value of classic coin series’ already in circulation among collectors and may, in turn, have had a detrimental impact on high-end collectible values.

Several months ago, we wrote a column about the fluctuating nature of precious metal futures. This argument holds as true now as it did then. No matter how “hard” or secure an asset it may be, gold will always still be subject to market activity and speculation. Therefore, the difference between gold futures and rare gold coin pricing is simply another reminder for buyers to do their research before purchasing gold on a whim – and for collectors to focus on the intrinsic value of a timeless and educational hobby rather than the prospect of monetary gain.

As experienced

rare coin dealers

, we strive to help customers at both of our San Diego locations to improve their research methods, develop an eye for genuine pieces and learn how to make the best purchases for their collections. In addition, we offer clear guidance when it comes to fair pricing, as well as honest assessment, purchase and sale of rare gold coins. To learn more about

precious metals in San Diego

, stop by The Coin Shop in La Jolla or get in touch online today. Visit