Friday, December 9th, 2016 MST

Gold Krugerrands vs. Gold Eagles

With the sharp drop in the price of gold, Krugerrands are scarce because few investors are willing to sell. Further, for a while the U.S. Mint was not able to supply enough 1-oz Gold Eagles. So, a major wholesaler began importing, for the first time in decades, new Krugerrands.

Yes, 2008-dated Krugerrands are for sale. However, they sell near the same price as new 1-oz Gold Eagles as the wholesaler’s cost is about the same for Krugerrands as it is for Gold Eagles.  So, when the situation is Gold Krugerrands vs. Gold Eagles, I recommend that gold buyers wanting 1-oz gold coins go with Gold Eagles, not 1-oz Gold Krugerrands.

When gold again moves up in price—and it will shortly after the bullion houses get finished with their manipulation—the premium on secondary market Gold Krugerrands will fall as sellers return to the market.

It is estimated the some 25 million 1-oz Gold Krugerrands call the United States home, and for decades Krugerrand sellers more than met the demand for the coin, causing the Krugerrand to be the low premium “bargain” gold bullion coin. I believe that situation will return as the price of gold moves higher.

Meanwhile, 1-oz Gold Eagles have maintained solid premiums (except for the Y2K selling throughout 2000 and part of 2001). So, don’t buy Gold Krugerrands at Gold Eagle prices when Krugerrand premiums are likely to shrink when sellers return.

Investors seeking low premium gold coins should consider the Mexican 50 Pesos Centenarios (1.2057 oz) and the Austrian 100 Coronas (.98 oz). Although the coins are not now promoted and therefore not well known with the public, these two coins are well known in the coin and bullion industry and can be easily liquidated. Although Centenarios and 100 Coronas are not always available, they are worth an inquiry. One-ounce gold bars and 10-oz gold bars are other low premium options