Gold Proof Coins

Minters craft gold proof coins to exacting standards from superior metal. That makes these coins an excellent investment for any portfolio. In the content below, you’ll get the answers to some of the most frequently asked questions about gold proof coins.

How Do Proof Coins Differ From Bullion and Other Coins?

Minters make proof coins to the highest standards. Their dies are handcrafted and monitored closely. These dies are regularly reworked and repolished. That ensures each and every silver or gold coin proof has a clean, blemish-free finish.

Minters strike each proof coin at least twice at lower speeds and higher pressure than bullion and other coins. In other words, making proof coins is more laborious than traditional coin minting. The effort is worthwhile though, as proof coins are sharper and more defined than other coins. That makes them the ultimate examples of coin minting.

Most proof coins also have striking finishes. They typically have mirrored backgrounds and frosted foregrounds. Using two different and contrasting finishes emphasizes the foreground details better. Some proof coins have reverse frosting with frosted backgrounds and mirrored foregrounds. Matte and satin frosting and all-frosted finishes add further interest. There isn’t much variation in the finish of bullion coins and other collectible coins. These coins usually have the same mirrored appearance on the background and foreground.

To maintain die quality, minters make fewer gold proof coins than bullion coins. They usually market proof coins as limited editions. Their relative rarity further adds to their appeal.

Proof coins are often sold as premium items with protective boxes and authenticity certificates. They are also inspected and hand-polished to ensure they look their best. Bullion coins don’t receive this VIP treatment. They are often unboxed and sold without certificates. The higher prices of proof coins reflect their superior quality and scarcity.

Who Buys Proof Coins and Why?

Discerning coin collectors and investors buy proof gold coins. These buyers appreciate the superior finish of proof coins and don’t mind spending more on them. Some people simply want to have the best in their collection. Others spend more now, anticipating a greater payout when they sell their proof coins in the future.

What Factors Drive Changes in Proof Coins and Their Value Over Time?

Proof coins typically appreciate in value over time. Several factors drive their growth in value, including:

  • Their flawless quality: As minters inspect proof coins before selling them, boxed coins that aren’t handled often stay flawless. Flawless coins can command much higher values than coins with blemishes.
  • Their boxes and certificates: As with action figures, toy cars and other collectibles, proof coins in original boxes can cost more than unboxed coins. Certificates of authenticity also increase value.
  • Their relative scarcity: Since proof coins are produced in limited quantities, demand usually outstrips supply. This can force prices up. The smaller the number of proof coins made, the more likely it is they’ll significantly increase in value.
  • Their date of minting: Following on from the earlier point, proof coins with key dates can appreciate more rapidly than other proof coins. Key dates are dates in a given coin series that are rarer than others. For example, the 2017 American Eagle one-ounce gold proof coin is usually valuable because there were only 9,245 ever made. The 2001 one-ounce American Eagle proof gold coin is a prized older example. These proof gold eagles are the first low mintage coin in this series with only 24,555 made.

Why Buy a Gold Proof Coin?

You might decide to add one or more gold proof coins to your collection or investment portfolio for several reasons, including:

  • They look beautiful. Their higher minting quality and typical mirrored background make gold proof coins so striking. Many people buy proof gold coins simply because they think they’re beautiful.
  • They are expertly made. Gold proof coins are for people who appreciate the finer things in life. They’re minted to exacting standards, so they’re a great choice when only the best will do.
  • They are real collector’s items. Since most gold proof coins come boxed with certificates of authenticity, they appeal to collectors. You might buy a gold proof coin because you love collecting items or because you think they will appeal to a collector in the future.
  • They’re made from precious metal. Gold is a premium metal that many people love. A gold proof coin can be a real status symbol.
  • Many are limited editions. Minters make many proof coins in very limited qualities. Many people buy them because they know many others won’t have them.
  • They can diversify your portfolio. The best investment portfolios contain a range of different items. Choosing different investments helps minimize a portfolio’s volatility and risk. You might buy a gold proof coin to expand your investment options.

Why Buy Gold?

Proof coins are available in gold and silver. Both are excellent options for collectors and investors. However, there are several reasons you might choose gold over silver:

  • It holds its value. Since ancient times, cultures have revered gold as a precious commodity. Unlike some investment options, gold tends to hold its value. That can make it a very secure investment option.
  • It’s a good inflation hedge. Unlike most investments, the value of gold tends to increase as the cost of living rises. Buying gold can be a great way to offset other investment losses when inflation soars.
  • It’s in demand. As demand for commodities increases, their prices typically rise. Demand for gold has increased as emerging economies, including India and China, have become richer [1]. Gold has become highly sought after for investments and jewelry, a trend that may continue in the future.

Most people appreciate the superior craftsmanship of gold proof coins now, but it’s also the key to their investment appeal. For collectors and investors alike, gold proof coins can be an excellent addition to any portfolio.


Sources

  1. Investopedia. 8 Good Reasons to Own Gold, https://www.investopedia.com/articles/basics/08/reasons-to-own-gold.asp. Accessed September 15, 2020.