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Tuesday, 11th August 2009 (3722 views)

Economic uncertainty is fuelling demand for gold and many investors are finding gold coins one of the most attractive ways to protect their money from the turmoil, an expert has said.

Mike Will, chief executive officer of collectible coin specialist Encore Gold, believes gold coins are proving popular because they allow individuals to start off with relatively small investments before they build up a collection.

He added that gold coins are generally viewed as good long-term assets, with a study by Collector's Universe finding that $1,000 invested in rare US coins in 1970 would be worth $57,977 (£34,993) now - providing a better return than the US stock market over the same period.

Gold coins also retain their value during downturns and will only increase in worth as inflation rises, Mr Will said.

Furthermore, because coin collectors can spread their investments across a many pieces, they have greater flexibility when it comes to selling and, unlike some assets, payment for coins is immediate once a transaction is agreed.

Tony Baird of bullion dealer Baird & Co recently told the Telegraph that another benefit of gold coins is that they carry no "counterparty risk", as the investment is not dependent on another entity fulfilling a guarantee or staying in business.

 

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