Sovereign Gold Coins Review: Pros and Cons

Sovereign gold coins can be a good choice for many gold bullion investors, but these do have some drawbacks as well. Before you decide to invest your capital in these choices you should understand the pros and cons of these investments, so you can make more informed investment decisions. When it comes to gold coins for sale, you have an almost unlimited amount of investing options. Almost every developed country offers bullion coins for gold investors, including Canadian and British gold coins, and many of these are well known in the gold market as terrific investment choices.

British Sovereign gold coins are one of the most popular bullion coins originating from Great Britain. At the height of British Empire, they were so popular that they were minted in Australia, India and Canada.

Modern day Sovereign gold coins are struck from traditional Crown gold of 22 karat composition. The obverse of the coin depicts an iconic profile portrait of Queen Elizabeth II and the back features St George killing a dragon design. Below you will find pros and cons of these coins for your consideration.

Pros

One of the pros of Sovereign gold coins is the history behind them. British Crown coins have been used through history, and the sovereign is the most widely recognized of all. These are so well known that during wartime many armies included some into military packs, both in Britain and in America during World War II. Unlike many modern coins, like Australian Gold Nuggets, the sovereigns were accepted anywhere in the world in the past and could be used in an emergency as currency to survive. These older Sovereign gold coins can have a high numismatic value, and they are sought by investors for this reason as well.

By acquiring gold Sovereigns you are adding an incredible piece to your collection or portfolio which is backed up by the British Royal Mint guaranteeing only the highest quality and beauty.
Recent editions gold Sovereigns are extremely liquid coins and have legal tender to be accepted as payment in many countries. American soldiers as recent as Desert Storm (1991) carried an emergency kit that included British Sovereign gold coins in case of an emergency evacuation. These coins are accepted in many countries, and can be used as legal tender if need arises.

For citizens of United Kingdom, British Sovereign gold coins also offer additional tax benefits. These transactions are exempt from the value added tax and the capital gains tax, to encourage domestic precious metal investment over foreign gold coin investment choices. This has not prevented other investors from buying these coins, and they are popular with Americans as well.

Cons

Some old Sovereign gold coins (non bullion variants) do have liquidity problems, especially if they are very rare and valuable. Some of them may be worth a large amount, and finding a buyer may not happen instantly for some of them like it can for gold Maple Leaf coins and other extremely liquid coin choices.

Sovereign gold coins carry much higher dealer premiums to the gold content compared to other bullions like American Eagle gold coins, for example. This is due to various factors including difficulty in identifying them and their high interest among numismatists.

These coins are not your standard bullion weighing a full one troy ounce, their weight is 7.988 grams (a rough ΒΌ of an ounce) and they are about the size of a nickel. This can certainly create confusion for new investors trying to calculate their value based on the current spot price of precious metals.

Sovereign gold coins do have both pros and cons, but for most investors the benefits of these coins far outweigh any drawbacks they may have. They are a popular choice for many investors, and the cons of these investment choices are normally few, and they are minor when they are present.