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What Is a Krugerrand? A Guide for Investors

what is a krugerrand

Some people assume that coin collecting is a fad of the past. However, market experts predict that the coin collectibles market will grow by more than 10% on average each year until 2032 at least.

As coin collecting and gold investment both become more common, there are also a lot more people who are asking, “What is a krugerrand?” These special coins have a long and fascinating history. On top of that, they have many interesting features that attract the interest of collectors and investors alike.

Depending on your situation, buying Krugerrands might be a savvy way for you to improve your financial health. So what are Krugerrands, and what’s so special about them?

Read on to learn all about the most vital things to understand about Krugerrands and their value as a potential investment!

What Is a Krugerrand?

Krugerrands are unique gold coins that come from South Africa. They are some of the most prestigious coins in the world of coin collecting.

They are made from pure gold sheets. These sheets are first stamped into blank discs. After that, they are minted to create Krugerrands.

How Old Are Krugerrand Coins?

So what are some of the things that contribute to the Krugerrand’s value? Many people appreciate the history of Krugerrand coins. The first Krugerrand ever created was made in 1967 by the South African Mint.

This was a time of incredible political unrest. The United States stopped basing its own currency on gold. Because many countries look to the United States as a leader in economic issues, this made many other nations consider the possibility of ending their own gold standards.

However, South Africa made a bold decision. It created a special gold coin featuring the appearance of Paul Kruger, the president of the Old South African Republic.

Most gold coins are created so that rich people can enjoy, collect, or invest in them. However, one of the main points of the Krugerrand coin was that it would be accessible to everyone. In other words, since 1967, Krugerrand gold coins have been designed for working people and used to help them improve their financial health.

On top of everything else, the Krugerrand coin is the first gold bullion coin ever created in the world. In fact, it was the success of this coin that inspired many other countries to create similar coins.

Although Krugerrand coins are not ancient, this fascinating history adds to the Krugerrand value. As the years and decades go by, Krugerrand coins may become even more valuable as people appreciate their history.

What Are These Bullion Coins Like?

On one side of the Krugerrand coin, you will see a springbok antelope. This is the national animal of South Africa.

On the other side, you will see an old man with a long beard. As we have discussed, this is Paul Kruger, who was president at the time of the creation of these coins.

The word Krugerrand comes from combining his last name with the Rand, the standard unit of currency in South Africa.

A standard Krugerrand coin will weigh 1 oz. Krugerrand coins are made out of a special alloy of gold and copper. The combination of 22-karat gold and copper creates a coin that’s more durable than many other kinds of gold coins.

On top of that, it gives the Krugerrand coin a distinctive reddish hue. This unusual difference is another reason that many collectors value Krugerrand coins so much.

Although the original Krugerrand coin weighed 1 oz, you can now find much smaller Krugerrand coins as well, even some weighing as little as 1/10 of an ounce. These smaller coins have been created as an extension of the idea that Krugerrand coins are meant to be accessible even for the working man and woman.

Do Krugerrands Count as Legal Tender?

Although you wouldn’t want to use them this way, Krugerrand coins do technically count as legal tender. That means that the government of South Africa has committed to accepting Krugerrand coins as payment.

However, a standard Krugerrand is only worth a single Rand. That means that the metal in a Krugerrand coin is worth much more than the official value of the coin if used as legal tender.

Although there may never be any point in spending Krugerrands this way, this distinctive feature is another that adds to the attraction to Krugerrand coins for many collectors.

Why Aren’t Krugerrands More Common?

Although Krugerrands enjoy enormous prestige today, things were not always so bright for them. During the dark days of South African apartheid, many people saw investment in Krugerrands as a symbol of support for apartheid. As a result, many people looked down on Krugerrand coins and some countries even banned them as imports.

However, it has now been almost 30 years since the end of apartheid. Since then, Krugerrand coin production has only gotten larger as demand for these coins continues to go up around the world.

Can You Find Silver Krugerrands?

In the past, only gold Krugerrand coins were available. However, in 2018, a silver bullion Krugerrand coin was created.

That adds another coin to a potential collection of Krugerrand coins. That may make some collectors more enthusiastic about collecting every kind of Krugerrand coin there is to be had.

Even if you only care about coins for investment purposes, this may increase their value in the future.

Why Do Institutional Investors Like Krugerrands?

At the end of the day, there are good reasons that investors value Krugerrand coins so much. In fact, these coins are the most popular bullion coin investment option on the planet.

It’s even more impressive that these coins have achieved this success after facing so many challenges during earlier years. It is a testament to their incredible quality and value that they have out-competed all other investment bullion coins in the world.

Another great thing about Krugerrand coins is that they are recognizable. From their distinctive color to their unique design, this is a coin that many people recognize and even attach sentimental value to. Many people in South Africa are proud of this coin and hold it up as a symbol of their country.

Because these coins are so popular, it is often easier to find people willing to buy and trade them than it is for almost any other bullion coin. As much as some people love collecting these coins or using them to store their wealth, they are also some of the most traded coins around.

As great as Krugerrand coins are for investment in general, they may be an even better investment choice given current economic conditions.

Buying Gold During Times of Inflation

As more countries face difficult economic times, inflation continues to degrade the value of currencies around the planet. Of course, that means that the value of gold is going up at the same time.

Gold and silver coins are some of the most effective ways to protect your wealth from the ravages of deflation. If you’re going to invest in gold, why not invest in a gold coin that has a rich history and sentimental value as well?

The popularity of this coin is a practical consideration for savvy investors. The more stable the popularity of Krugerrand coins, the better the chance you will be able to sell your coins later when market conditions are more favorable.

How Can You Find Krugerrands?

There are banks around the world with commitments to buy Krugerrand coins at any time. That makes Krugerrand coins one of the easiest ways to protect yourself from inflation while also enjoying incredible liquidity. In fact, a few simple searches on a search engine are often enough for you to find plenty of people interested in buying and selling Krugerrand coins.

However, you don’t need to find individual buyers or even visit a bank to buy and sell these beautiful coins. There are plenty of companies that are set up to help people protect their wealth by investing in gold. Most of these companies are also willing to buy gold coins back from their customers.

Of course, it’s vital that you find the right business to work with if you want to buy or sell Krugerrand coins. You might want to start by looking at reviews from other customers. The more positively other people view a gold coin company, the better the chance they’ll be a great business to help you use gold coins to manage your financial health.

It is also worth looking for companies that have been in business for a long time. Added experience often translates to better service.

Understand the Details of Krugerrands

If you’ve ever wondered, “What is a Krugerrand?”, we hope you now have your answer. The more you understand about these unique coins, the easier it will be to appreciate why investors value them so much. We hope that this article has helped you decide whether investing in Krugerrand coins might be the right strategy to take your financial health to the next level.

To find out more about where you can buy and sell gold and silver coins, contact us at CMI Gold & Silver at any time!

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