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Four Bullion
Portfolios & FAQ
Please
note that our recommendations vary depending on your concerns and
the market.
If
you want to invest in gold and silver to protect your assets and
have something easily divisible and spendable in the event to
hedge currency depreciation or collapse, then:
v
If you
have $5,000 or less to spend
put half in US 90% silver coin, and half in British Sovereigns,
French 20 Francs, or 1/4 oz. American Eagles. (All references to
“ounces” below mean troy ounces of 480 grains or 31.1034
grams).
v
For
$10,000
buy two-thirds US 90% silver coin, and the balance in British
Sovereigns, French 20 Francs, or 1/4 oz. American Eagles.
v
For
$25,000
buy 3 bags of US 90% silver coin, $2,000 worth of Sovereigns, French
20 Francs, or 1/4 oz. American Eagles, and the balance in one oz.
Krugerrands, Austrian 100 Coronas, Mexican 50 Pesos, or American
Eagles.
v
For
$75,000
buy 10 bags of US 90% silver, $5,000 worth of Sovereigns, 20 Francs,
or 1/4 Eagles, $5,000 worth of platinum Nobles, and the balance in
Krugerrands, American Eagles or 100 Coronas.
For over $75,000 simply
do multiples of this portfolio.
If
you want to invest in precious metals to simply protect your assets
and don’t think you’ll ever need to actually barter with them, then
v
If you
have $5,000 or less to spend
put half in US 90% silver coin, and half in one ounce Krugerrands or
American Eagles, or in Austrian 100 Coronas or Mexican 50 Pesos.
v
For
$5,000 through $25,000
put at least half of your money in US 90% silver coin. Put the rest
in one ounce Krugerrands or American Eagles, or in Austrian 100
Coronas or Mexican 50 Pesos.
v
For
$75,000
buy 10 bags of US 90% silver, $5,000 worth of platinum Nobles, and
the balance in Krugerrands, American Eagles, 100 Coronas, or 50
Pesos. For over
$75,000 simply do multiples of this portfolio.
FAQ
Moneychanger, what is US 90% silver coin and why do you recommend
it?
US 90% silver coin is quarters, dimes, and half dollars
minted before 1965. Each face value dollar (4 quarters, 10 dimes,
or 2 half dollars) contains 0.715 of an ounce of silver. Coins are
traded in “bags” of $1,000.00 face value containing 715 troy
ounces pure silver. (We refer to a “face value dollar,” the value
stamped on the coin’s face, which is always less than from the
“paper dollar” cost you must pay. So if you have $1,000.00 in
paper dollars to spend, you will never get $1,000.00 face
value.) You can purchase any portion of a bag that you
wish.
We recommend 90% silver coin simply because right now it
is the cheapest, most divisible, most widely recognised and traded
form of silver.
Moneychanger, why do you recommend gold coins like Krugerrands,
Austrian 100 Coronaes, and Mexican 50 Pesos, and what are they?
We recommend these foreign coins because they cost less
per ounce and give you more gold for your money than the
American Eagle gold coin series. All of these coins are well known
in the industry and any dealer will readily buy them.
The 22 karat South African Krugerrand gold coin
contains exactly one troy ounce of fine (pure) gold. The American
Eagle copied the Krugerrand’s specifications, and is minted to
exactly the same weight and fineness.
The Austrian 100 Coronae is an official re-strike
from the Austrian mint. It is 20 karat (90% pure) and contains
exactly 0.9802 troy ounce fine gold.
The Mexican 50 Peso is an official re-strike from
the 400-year old Mexico City mint. A 20 karat coin, it contains
exactly 1.2057 troy ounce of fine gold.
These three coins take turns as the cheapest coin on our
price sheet.
Why
do you recommend older-issue, foreign fractional gold coins instead
of modern issues or American Eagle fractionals?
Modern issues like American Eagles, Maple Leaves, Philharmonics, and
Nuggets include half, quarter, and tenth ounce coins: the smaller
the coin, the higher the cost per ounce. With the smallest coins,
premiums over the gold content approach 15%. That makes no economic
sense because gold is gold. British sovereigns (containing
0.2354 troy ounce fine gold), French 20 francs (0.1867 oz.), Swiss
20 francs (0.1867 oz.), German 20 marks (0.2304 oz.), Netherlands 10
guilders (0.1947 oz.), the whole series of Mexican peso coins, and a
number of other gold coins offer lower cost per ounce and good
liquidity. Not recommended are gold coins so infrequently seen in
this country that you will suffer a big discount when you sell them,
such as Iranian Pahlavis (0.2354 oz.) or Saudi guineas (0.2354
oz.). If you can’t sell them, they’re not a bargain.
Moneychanger, nowhere in your recommendations do I see anything
about pure gold coins like the Canadian Maple Leaf or Austrian
Philharmonic. Why not?
Gold is one of the softest and most ductile metals. Pure
gold coins scratch and scar very easily unless handled with extreme
care. Throughout history gold coins have generally been alloyed
with copper or silver, hardening them to withstand circulation.
Customers often unwittingly damage pure gold coins and therefore
receive up to 5% less for them when they sell. In our opinion the
purity of 24 karat gold confers no benefit and in fact often creates
drawbacks.
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