As it becomes more and more commonplace for people to turn to gold, silver and other precious metals as a way to add stability to their portfolio and hedge their assets against inflation, it is worth remembering that the prudent investor carefully considers the best strategy for attaining their financial goals. After all, investing without a long-term plan can be costly.
This investing also holds true for coins. Although some coin enthusiasts may view their collection as more of a hobby than an investment, the reality is that it’s a bit of both. As such, it is important for both the coin hobbyist and the serious investor to have a strategy in mind when purchasing their precious metal coins.
Below are some popular strategies for collecting gold coins that you can use.
By Series
The traditional approach of acquiring one coin of each date and mint within a series tends to be the most daunting collecting strategy, particularly for gold coin collectors. However, it can also be very rewarding.
The Saint-Gaudens double eagle series, for example, ran for 26 consecutive years, with several variations between high-relief and low-relief versions, circulated and uncirculated, as well as frequent design changes in the early years. And, of course, the true series collector would also have to get their hands on the 1986 American Eagle gold bullion coin since it reused the classic Saint-Gaudens obverse design.
While there are other coin series that are newer and thus easier to achieve a complete collection—such as the Indian Head gold dollar or the Australian Lunar series—affordability tends to be another challenge of collecting gold coins by series. Certain coin mints and years are extremely rare, fetching high prices—some as much as five figures. Because of this, collecting gold coins by series requires planning and saving, and is not for the faint of heart.
By Denomination
An alternate coin collecting strategy is seeking out each type of coin with a particular denomination. Denomination is the proper description of a currency amount. For gold coins, $2.50, $5, $10 and $20 denominations are the most common.
For instance, you could decide to collect only $10 gold coins, or perhaps $10 and $20. Collectors may run into scarcity issues on the earlier versions, however, when taking a denomination-based approach. One tactic for collectors who decide to go this route is to focus on the most readily available issues first by selecting denominations introduced later.
By Century or Year
Another coin collecting strategy is to stay fixed on a time frame, such as a particular century, decade or year. The 20th century set, one of the most popular collection types, consists of one example of each of the 8 types of circulated coins minted dated 1901 and 2000 (the Coronet Head $2.50, Indian Head $2.50, Coronet Head $5, Indian Head $5, Coronet Head $10, Saint-Gaudens $10, Liberty $20, and the Saint-Gaudens $20). The 20th century set is one of the most popular coin collections because a completed set is easily achievable and fits most collectors’ budgets.
You might choose instead to collect all coins from a different century or a significant year, such as the year you were born.
By Design
If you are partial to a particular design theme or designer, consider focusing your collection on that attraction. For instance, if you really like the Bald Eagle, then pursue coins with that motif, such as the American Gold Eagle, Saint-Gaudens Double Eagle, Indian Head and the Canadian Bald Eagle coins (among others). Or perhaps you can start a collection of all the coins conceived by a famous designer like Anthony de Francisci, sculptor of the Peace Dollar.
(Read our article Knowing the Anatomy of your Coin to learn more about the terms we use to describe the design of gold and silver coins.)
By Mint
Today, there are four official U.S. mints: Philadelphia, Denver, San Francisco and West Point. There are also branches located in Carson City, Charlotte, Dahlonega, New Orleans and Washington D.C. Each of these mints and branches are rich in history and offer a touch of regional uniqueness. So collectors with an interest in, say, the California Gold Rush may find it most rewarding to focus on San Francisco mint gold coins exclusively.
(Read our blog post exploring the California Gold Rush for an exciting tale of daring adventure, fame and fortune…)
By Circulation
In the various categories of gold coin types, another distinction exists between coins that were circulated as currency versus those that were not. Uncirculated commemorative gold coins are the latter of these—coins that do not serve as legal tender, but rather are issued to commemorate a particular event, issue or individual. Some popular commemorative coin series are the American Arts Commemorative Series and the Presidential $1 coins, for starters.
By Collector’s Choice
Of course, the beauty of coin collecting is that collectors aren’t forced to limit their set to a certain series, denomination, year, mint, design or type. You can use any combination of these strategies above, or invent your own approach that best fits your interests and budget.
Whatever strategy you ultimately decide on, the most important thing is to be prudent and have fun!
Start your own gold coin collection by visiting Provident Metals online. Click here to shop now, or check out our Coin Buying Guide to learn more coin facts, history and specs.