The weight of gold coins usually ranges from 1/10 of a troy ounce of gold to one full troy ounce, with gold purity varying from mint to mint. These differences leave investors and collectors with a vast range of investment options.
Choosing between mints, types of coin, and purity can be overwhelming, but it doesn’t need to be. Let’s take a look at the benefits of 1/10 oz gold coins and whether they might be the right choice for your journey with gold, whether you’re just getting started or you’re adding to your established collection.
The lowest weight coins in regular production, 1/10-ounce gold coins tend to offer the most affordable entry point to an investment in physical gold coins. These gold coins are light and easy to store and transport, offering immediate benefits whether you’re holding gold personally or paying for storage. For instance, the 1/10 oz American gold eagle is a bit smaller than a dime.
On one hand, heavier coins offer more value when compared to the spot price of gold, simply because they contain more gold. On the other hand, lighter coins like 1/10 oz coins allow investors to buy more individual coins with about the same amount of money. For the price of a single 1 oz gold coin, you could buy perhaps 8 to 10 coins weighing 1/10 troy ounce each. It’s not a direct correlation, though. Even though smaller coins contain less gold, they take about the same amount of labor to mint as larger coins. Despite their lower price per each, fractional gold coins generally cost a higher percentage over spot price than larger coins.
Buying more coins for your money allows you to significantly diversify your collection, potentially hedging against fluctuations in market prices. The value of many types of gold coins isn’t tied solely to the spot price of gold. Different mints, years and designs of gold coins may have quite different values, and those values may change based on the demand for that specific type of coin at any given moment.
Many investors choose to diversify their collection to prevent weak demand for one specific type of coin from undermining the value of their overall gold coin holdings.
Finally, the monetary value of each individual coin isn’t the only consideration. Gold coins are fascinating pieces of art and craftsmanship, each with a rich history and designs chosen by their respective mints. Many collectors and investors consider this as well, prizing the beauty that a diverse range of coins can offer.
Mints worldwide issue 1/10 oz gold coins. A classic example is, of course, the 1/10 gold eagle which features Lady Liberty by Augustus Saint-Gaudens on the obverse side. Those particular coins are in high demand with an active, liquid market and consist of an alloy called crown gold which is 91.7% gold, 3% silver, and 5.3% copper. These baby eagles each have a face value of $5.
South African Krugerrands are issued by the South African Mint at the Rand Refinery. They bear a 916.7 or 91.67% gold fineness (also made of crown gold), bearing Coert Steynbert’s portrait of former president of South Africa Paul Kruger on the obverse side. Unlike most sovereign-minted coins, krugerrands do not have a nominal face value.
There are many other coins in this weight class on the market. Other examples include:
Most of the world’s “gold” trade is actually paper-based, meaning it relies on gold that may or may not exist. Today, this level of trading is handled through computer systems. This aspect of gold investment is vulnerable to computer errors or hacking as well as human error in the various banks and institutions carrying out the trades.
Paper-based gold is very far removed from the trade of physical gold, which cannot be hacked, erased, or duplicated on a computer. Owning physical gold guarantees your investment actually exists (you can see it and hold it in your hand). This is by far our preferred method of owning actual precious metals.
One of the oldest forms of money globally, gold today acts as a hedge against sovereign-issued, unbacked IOUs (also known as “fiat money”), which again is highly digitized. World central banks increased the global supply of cash by unprecedented levels in 2021, sowing the seeds for significant inflation events. As such, many new investors and savvy individual savers have begun to consider gold as a safe haven from that inflation.
Many gold coins are eligible for inclusion in a precious metals IRA, allowing you to save for your retirement with physical precious metals. Ultimately, the experience of owning a collection of gold coins with designs and backstories from around the world simply must be experienced to be understood. Each coin is like a museum exhibit packed with culture, history and technology that you can hold in your hand. Investment in physical gold grants a level of security and freedom that many find simply isn’t possible otherwise.
Need help or advice in purchasing 1/10 oz gold coins? Get in touch with BullionMax to get started with your gold purchase now.