For those who are interested only in precious metals’ capacity to store stable purchasing power regardless of the fluctuations of paper money values, gold rounds offer a viable alternative to buying more expensive gold bullion coins issued by the government mints of the world. Gold rounds, like all rounds, are basically coins that are issued by non-governmental organizations but, in order to avoid being denounced as forgeries, have no face value and no claim anywhere on them to be legal coinage.
Rounds are usually not as collectible as coins or proofs, which means that their value will never increase much beyond that of their constituent metal. The spot value or melt value, plus a fairly narrow premium above spot, is all that these coins are usually worth, and, probably, ever will be worth.
Nevertheless, gold rounds are an excellent choice for those who want to invest in gold, and want it primarily as an anti-inflation hedge. The very fact that these rounds are worth only a little above spot actually might make them a better hedge in some cases, since they will be easy to liquidate for as long as humans continue to value gold highly – which will probably be to the end of time.
Gold rounds are typically made just as artistically as government minted coins are, and are designed to be as attractive a bullion source as possible. They are made to a very high standard by many of their manufacturers, with exquisitely detailed designs, crisp, clean striking, and a mirrored finish that is the equal of anything that a mint places on their coins. In their most important regard – that of their value – they are again the equal of coins, with fine gold used to strike them, with 24 carat (.9999 fineness) being the usual metal employed to ensure that their value is maximized.
One important consideration when you are purchasing gold rounds for later use is that these items are frequently traded many times among precious metal enthusiasts. Since they are usually made out of pure gold, with no alloys to lend them durability, you should remember that they are soft and can get worn if they are not properly protected.
You can place them in individual coin protectors, or you can store them in mint tubes. Because they are not actual products of a government mint, you will likely need to buy the mint tubes separately to store them with. Conveniently, however, they are made in sizes that imitate coins fairly closely, so the same storage devices that work for your coins should work for your gold rounds as well.
As with all purchases of such items, you have the choice between buying only gold rounds, and creating a mixed portfolio with gold rounds, bullion coins, and collectible coins for investment purposes. You can even throw in gold bars if you are affluent enough to collect this many different types of gold. Although a diversified precious metals portfolio is considered, most of the time, to be one that includes gold, silver, palladium, and platinum (meaning that all your stored value is not dependent on a single spot price), diversifying the types of precious metal objects within each category can be useful as well, because some types may end being more liquid in some times or circumstances than others.
Diversifying between metal types helps to hedge against price variations. Diversifying within a type is a hedge against liquidity problems – for example, you may need money in a circumstance when the person you are dealing with only wants gold bars, or you may meet a collector who will pay a high premium for a collectible coin but has no interest in ordinary bullion. Adding gold rounds to any hoard of precious metals helps to make your reserves more flexible in every situation.
More Details About Gold Rounds
Gold rounds come in a number of different sizes, though they are not quite as diverse as gold coins (especially in the larger sizes – some gold coins are so vast that they are more like gold millstones than anything numismatic). The most typical size – just as is the case with bullion coins, both gold mintage and silver versions – is one troy ounce, with roughly the same dimensions as a gold bullion coin from an official government mint.
Since gold is extremely expensive, smaller gold rounds are also produced, in order to accommodate the pocketbooks of those who do not have a high income, but still want to benefit from the wise precaution of setting aside part of their funds as a precious metal which will not lose real value whatever rises or plunges the value of paper money goes through.
Some of these sizes include 1/10 ounce, ¼ ounce, and ½ ounce rounds. Usually, the only smaller alternative is gold bars, with some fractional gold bars being as small as 1 gram – which is only a bit more than 1/32 of a troy ounce. It may be possible to find 1/20 ounce gold rounds from some producers, however.
APMEX, the American Precious Metals Exchange, is an example of a modern company which produces a range of very high quality gold rounds. Their half-ounce round gives a good idea of what can be expected from these bullion objects. This round is just slightly more than an inch (26.94 mm) in diameter, and is quite thin, at only a little thicker than 1/15 of an inch (1.7 mm). The “obverse” bears the maker’s name, the legend “1/2 Troy Ounce”, and the label “.9999 Fine Gold”.
The “reverse”, if the term can be applied to a gold round, shows a finely sculpted bald eagle with a “Liberty” ribbon in its beak, an American shield beneath the bird, and the well known emblems of the sheaf of arrows and the olive branch in its talons. The written information from the obverse is repeated here in lieu of national or denomination markings. This is a good example of how gold rounds are designed to provide information about the round, its purity, and its manufacturer, while evoking imagery that is strongly suggestive of national monetary themes.