Investing in gold coins
When world economies shiver and shake, gold prospers.
Gold bullion coins, which sell in the millions weekly, tap into the allure of investing in gold. American Eagle and Canadian Maple Leaf gold coins have high gold purity and are easily bought and sold through precious metals dealers.
Following the financial crisis, some investors turned to gold exchange-traded funds, or ETFs, to cash in on gold's rise. But in recent years, people have been moving away from them, says Barry Stuppler, president of Stuppler & Co., a precious metals dealer in Woodland, California. Why? Some ETFs don't own the physical gold, instead trading in a gold index. For example, the CBOE Gold Index tracks the price of gold-mining companies. Gold ETFs may even trade in gold futures contracts, making them risky investments, says Paul Mladjenovic, author of "Precious Metals Investing for Dummies."
That's why Mladjenovic prefers gold bullion coins. The price of the 1-ounce, 24-karat Maple Leaf approximately matches gold's spot price and enjoyed a meteoric rise between 2005 and 2011, when the price of gold more than quadrupled. But what goes up sometimes comes down: The price of gold coins has tracked the recent decline in the price of gold, as well.