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Fistful of affordable gold is within reach

By Mark Benvenuto

When it comes to serious coin collecting, and assembling collections that ought to go up in value over the course of years and decades, many collectors think of gold. There are certainly some beautiful pieces and beautiful series that have been struck in gold. The metal takes a design very well and often strikes up easily with sharp details. But the downside of gold is, and probably always will be, the price. It isn’t the king of metals for no reason.

Let’s see, though, whether gold has earned its “high priced” reputation or whether some of that is no more than hype. In other words, let’s see if there might be some gold coins and series we can collect without flattening our wallets thinner than the proverbial pancake. Here, for your consideration, are five areas you might want to look at when it comes to affordable gold.

 Not all Liberty Head $5 gold pieces are rare.

Not all Liberty Head $5 gold pieces are rare.

First, the Liberty Head Half Eagles

A few different series are called classic United States coins, including the Morgan silver dollars, the Peace dollars, and the Walking Liberty halves. When it comes to gold, the Saint-Gaudens $20 gold pieces are often at the fore. But we’re looking for affordable gold, and so Christian Gobrecht’s artistry – that used for the quarter eagle and half eagle from the late 1830s all the way up to 1908 – is the design and the coin we’re going to gravitate towards. Minted at the Main Mint in Philadelphia as well as at six other branch Mints over the course of decades, the half eagle series is long and has both some amazing highs and some truly low lows.

These half eagles have 0.24187 troy ounces of gold in each, which means we can look at the price of gold and estimate their worth at about one fourth of the market price of the precious metal – with an important caveat or warning. That warning is this: United States gold is collected extensively enough that we’ll never find these $5 gold pieces at or near the spot price of gold, unless a particular example has a lot of wear on it.

Since we know there is going to be a markup beyond the gold metal price, a logical way to start building any assembly of Coronet half eagles is to look for the most common ones and check their prices. A look through any catalog that gives mintage figures reveals that there are fifteen dates or mintmarks that saw totals higher than one million, with five of those going over two million. These are the most common coins in this entire series, and right now each costs about $450 in a grade such as MS-60. If you’ve always insisted your purchases not total more than $100 per coin, it’s time to recognize that gold will never be that inexpensive. But overall, $450 for almost a quarter of an ounce of gold that is also a piece of American history is not too bad a deal.

 High mintages make modern gold $5 commemoratives trade at gold value.

High mintages make modern gold $5 commemoratives trade at gold value.

Second, United States Modern Proof Gold Half Eagles

Moving forward in time several decades, we get to the modern United States commemorative coin program. It started in 1982 with a Washington half dollar in silver, and the gold component was first added in 1983 with a ten-dollar gold piece that is part of a three-coin set honoring the 1984 Olympic Games. The first half eagle, though, was unveiled in 1986 as part of a three-coin set honoring the centennial of the Statue of Liberty. For quite a number of reasons, this three-coin set was a big hit with collectors; and since the set could be ordered either in uncirculated or proof conditions, plenty of folks opted for the proof. Interestingly, that makes the proof version the more common of the two today and the less expensive.

It is noteworthy that the specifications for the 1986 half eagle are the same as for the classic half eagles that were made for circulation all those years ago. Indeed, all the half eagles in the developing modern commemorative series kept the same specifications. This means that when gold is trading on the world markets at $1,200 per ounce, a Statue of Liberty half eagle contains $290.16 worth of gold. This is certainly worth knowing when you look at price lists and find that the coin lists for only $350 in a grade such as PF-65. That’s a lot of gold for a very small markup.

The Statue of Liberty gold piece is the first in what has become a rather impressive string of commemorative half eagles. If you want to assemble some sort of set, you surely have to keep your eye on the prices, but it is also worth comparing the official mintages. The reason is that as time went on, and as the number of commemoratives in the program grew, a lot of folks appear to have decided there were too many to collect, and the official outputs dropped. For example, the 1992 quincentenary of Columbus’ voyage saw an attractive half eagle as part of a three-coin set, but only to the tune of 79,730 proofs. That’s quite the dip from the 404,013 proofs minted for the Statue of Liberty. But virtually all price guides list each of these two proof coins at the same price. That basically means the Columbus piece is a sleeper. It might be a fun pastime to find out just how many other sleepers are snoozing in this series, should you choose to build a collection of them.

 Tenth-ounce gold American Eagle coins are affordable and popular among collectors.

Tenth-ounce gold American Eagle coins are affordable and popular among collectors.

Third, the 1/10th Ounce U.S. Gold Eagles

If even the lower cost of the commemorative half eagles is too rich for your blood, you could step down to a third offering in our growing list of affordable gold to the 1/10th ounce gold American Eagle bullion coins. These are the littlest siblings of the gold Eagle bullion program, which have been produced annually since 1986. With over 30 years of them from which to choose, and with no real rarities in the series other than an error produced in 1999, it’s simply a matter of finding good-looking specimens. Those that can be called the regular strikes generally cost about $175 each, while the proof version made for collectors cost about $225. Yes, if you are doing the math in your head, this is higher than a direct 10% price markup when compared to the price of gold metal. That’s because there is always some increase when selling bullion coins, as opposed to just bullion. All things considered, though, it’s tough to find gold coins that cost less.

 Unlike the 1917, many British sovereigns were minted by the millions.

Unlike the 1917, many British sovereigns were minted by the millions.

Fourth, the British Sovereign

The fourth entry in our growing list is another classic but one that is not quite U.S., the British sovereign. It may seem odd to say “not quite U.S.” when referring to an obviously foreign coin, so let’s give a bit of back story here. The British sovereign has a centuries-old history to it, but during its heyday – roughly from the time of Victoria to just before the Second World War – this coin was accepted just about anywhere. A wealthy traveler getting off a ship that went from London to New York would probably have had little trouble spending his or her sovereigns or trading them for U.S. coinage at some bank. The British Empire was at its height, and its money was accepted in plenty of spots worldwide.

A person looking to begin a collection of sovereigns today could start quite easily with a couple from Queen Victoria, who has several different royal images on these pieces. The next step might be adding one per king, for every monarch after her. The prices won’t be all that high, since many of the dates are quite common. There is 0.2453 ounce of gold in each, making them just a tad heavier than our just-mentioned half eagles. But since these coins are not collected as heavily in the U.S., and since many of them are found in conditions that are AU or EF, it’s not odd to find them priced at something like the price of gold plus 10% or 15%. That’s roughly $311 when gold is at the $1,200 per ounce level. And that in turn is not a bad price for a gold coin with lots of history.

 A taste of the exotic comes with French 20-franc coins. This design ended with the outbreak of World War I in 1914.

A taste of the exotic comes with French 20-franc coins. This design ended with the outbreak of World War I in 1914.

Fifth, the French “Rooster”

We’ll complete our fistful of gold with what some collectors consider the French equivalent to the British sovereign, the gold rooster. This piece is more properly a 20-franc gold piece and was issued only from 1899 to 1914. That’s a lot less time than the sovereign, but this smaller date run means it might be possible to put together a date run as a collection. Each has 0.1867 ounce of gold in it, making it smaller than all but the 1/10th ounce pieces we’ve looked at, but the price comes down with that. That’s because, once again, it has prices connected to that of the metal, just like the sovereign. Roughly $250 will do for each one of the roosters.

All things considered?

Collecting gold may have always seemed like some type of pipe dream, a part of the hobby in which only your rich friends could indulge. But we’ve seen here that there are at least three United States series that can hardly be called expensive, as well as two foreign ones that have very attractive price tags and plenty of dates from which to choose. Now might very well be an excellent time to expand your collecting horizons into the noble metal.

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