Bullion vs Investment Grade

Understanding Bullion

Bullion is refined gold, generally in the form of minted coins and various sizes of bars. The value is primarily based on weight, the same as other commodities like crude oil, pork bellies, natural gas and wheat. This market index price is called the "spot price."

Investment Grade Coins

Investment grade gold coins are valued for their rarity, rather than their weight. They have been certified by a third-party to guarantee their condition and help track their rarity over time. These coins do not trade on an index and therefore have a value that is much less volatile than gold bullion. Since more people want these coins than have them, the value has been going up.

Unlike with bullion, the price of investment grade coins is not subject to manipulation by world banks, the Fed or other political forces.

Just like ocean-front real estate, classic cars, and fine art, the value of Investment Grade Coins is driven purely by supply and demand. Over time, the value tends to push higher and higher, regardless of what is happening in the equities market, commodities exchanges, bond market or overall economy.

The price stability and long-term growth potential are the key factors that make Investment Grade Coins ideal for investors who want to shelter and protect their assets from the rapid swings, seasonal trends and even crashes that are possible with stocks and other traditional investments.

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Diversification is Key

Investors have long understood the concept of diversification. In fact, it's the #1 reason people give for accruing precious metals in the first place. But most investors don't realize that it's not enough to just diversify INTO precious metals. To be truly diversified, you must also diversify WITHIN precious metals, by combining allocations of both bullion and Investment Grade Coins.

This is the only way to create a portfolio that grows as the "spot price" rises, but is also protected from volatility and positioned for superior long-term growth. This simple strategy creates a metals portfolio that is diversified, more balanced and more secure.

Your specific mix of the two asset classes (bullion and Investment Grade Coins), should be determined by 3 main factors:

  • Tolerance for risk
  • Time Horizon/Liquidity Requirements
  • Investment Philosophy

Portfolios that are heavily exposed to the bullion market are more aggressive and therefore more risky. They are generally recommended for short-term investors that are placing a bet on imminent market moves and are capable of stomaching a high-degree of risk, since prices can rise (or fall!) in a short period of time.

Portfolios that are more weighted in Investment Grade Coins are considered to be more secure and conservative, since the historical data indicated much less volatility than bullion, along with steady price appreciation. A minimum hold time of a least 5 years is recommended, to give the investment sufficient time to mature.

A balanced portfolio, with both bullion and Investment Grade Coins, is perfect of investors looking to limit their exposure to the ups and downs of the gold market price and shelter their investments from the geopolitical forces that are out of all of our control.

Real World Case Study

Over the past 10 years, both bullion coins and Investment Grade Gold Eagles have increased in value, unlike many other investment options which have struggled to perform at all.

Gold Eagle Investment Grade Coins are in perfect museum-quality condition and come in sets of four - one of each size minted in the same year. The United States Gold Bureau recommends these sets as a:

Anybody can tell you where the market has been and what is hot right now. Our strength is knowing where the market is going. Our executives team has over 50 years combined experience creating diversified precious metals investment portfolios with just the right mix of bullion and investment grade coins that are just right for you.

We have identified the Gold Eagle Proof Series as the #1 Gold Coin Investment for the next 10 years and beyond. It is the optimal way to diversify a gold investment portfolio to reduce volatility and establish a more secure portfolio that can stand the test of time.

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