You may have noticed that gold bars and gold coins UK often have the same purity but not the same price. This is something you might have seen when you shopped around at a gold dealer or looked online. What should you know when choosing which one to buy, and why is there a difference?
Gold bars are usually cheaper per ounce than gold coins. The “premium” is the key reason. It’s a fee added to the current price of gold to cover expenditures like making it, shipping it, and the dealer’s profit. With bars, these costs are spread out over more gold, especially as the bars get bigger. Because of this, the price per ounce goes down. If you want to acquire as much gold as you can for your money, bars, especially larger ones, are usually the best way to go.
Gold coins, on the other hand, include more than simply gold in them. Government mints make coins like the Gold Britannia or Krugerrand that have unique designs, historical meaning, and often limited mintages. These qualities are important to collectors and investors, which makes them more valuable and, in turn, more expensive. When you buy a coin, you’re also paying for its art, how easy it is to collect, and how well-known it is in the market. These things typically make coin costs far higher than the value of the metal alone, which is what you’d pay for a basic bar.
Another thing to think about is how flexible it is. Coins are typically made in lower weights, even fractions of an ounce, which makes it easier for people to buy little amounts or sell off a small part of their holdings if they need to. Most gold bars weigh between one gram and one ounce, but the ones that are the best value are usually bigger. This can make it tougher to sell only part of your investment if you only want to sell part of it.
It’s important to remember that not all coins and bars are the same. A 1oz bar from a well-known brand might cost less than a rare collector coin, while a low-mintage, uniquely designed bar could cost more than a regular bullion coin. Always look at the exact items you’re thinking about.
Taxes are also a factor. In the UK, for instance, some coins, such Britannias, don’t have to pay capital gains tax, but gold bars might not be able to take advantage of this. Even if the price per ounce is higher, this can make coins more appealing.
In short, gold bars are usually cheaper per ounce and are the ideal choice if you want to acquire the most gold for your money. Gold coins are normally more expensive per weight, but they have their own benefits, such as being easier to sell, having tax advantages, and being valuable as collectibles. It depends on whether you only care about the metal composition or whether you want more flexibility, beauty, and historical relevance.