Everything You Would Want To Know About Gold Bullion Coin

By: Eric McMillan

In the past, it was precious metals that were being traded for items and goods, until they began trading it in the form of the gold bullion coin. It had just become less convenient to have to lug along gold bars that weighed 12.4 kilos per bar around to trade for items, so civilization developed the need for something more practical and mobile, such as gold coins or even a 1 oz gold bullion.

Gold coins have had a long use in commerce and it was in the time of King Croseus in 643 BC when the first gold coins of uniform purity began circulating in the markets. Until the 20th century, gold was a common form of money and it was only during the Great Depression when countries stopped making gold coins because of hoarding.

Today, gold coins are making a comeback but only in the form of gold bullion coins. These are never meant to be released and circulated mainly because its face value is far less than the value of the gold it contains. For example, the Canadian Gold Maple leaf, which contains one troy ounce of gold, has a face value of 50 Canadian dollars, but as of July, 2009, the gold coin value has been estimated to be more than 1000 Canadian dollars already.

In the United States, the American Gold Eagle is the official gold bullion coin and is based on the Gold Bullion Act of 1985. These coins were released into the public in 1986. The 22 karat gold coin contains silver and copper and the impurities make the coin more durable.

The obverse of the American Eagle depicts Lady Liberty holding a torch and an olive branch while the reverse shows a male eagle above a nest that contains a female eagle and some hatchlings.

The gold coin can have different weights and face values. A coin that is roughly the size of a US dime can have as much as one-tenth of an ounce of gold inside it. A gold coin that has a troy ounce of gold within it is roughly the size of a US half dollar. To date, the biggest coin in the world is the Gold Nugget of Australia which has 1 kg of gold in it!

Today, most of the gold bullion coin ends up in the hands of collectors or investors. One buys bullion coin at a premium over the real value of the gold it contains. The reason for this includes cost of processing, storage and distribution, but the main force that determines how much gold is sold is good old supply and demand.

Article Source: http://yourfinance.co.za

About The Author
Eric McMillan is an ex real estate guy, who now markets online and is an die hard coin collector. Go to his website for more info about gold bullion coin. While you're there, pick up a free copy of the Gold and Silver Coins guide.