Investing in gold is a popular choice, and many investors turn to Royal Canadian Mint gold coins for their tangible value, unique history, and captivating artistry. But the real question remains: Are Royal Canadian Mint gold coins an effective investment?
The Royal Canadian Mint and Its Gold Coins
Established over a century ago in 1908, the Royal Canadian Mint is renowned for producing Canada’s circulation coins and minting medallions, tokens, and coins for other countries. Among its widely sought-after products are gold coins – including the Gold Maple Leaf coin that stands out as one of the purest globally at an impressive 99.99% purity.
The Royal Canadian Mint (RCM) is one of the most advanced and innovative mints in the world. Coins minted by RCM have high artistic value because of exceptional quality and attention to detail. That is why RCM is often awarded contracts from national banks of other countries.
Investment Value of Royal Canadian Mint Gold Coins
The value of Royal Canadian Mint Gold Coins comprises several factors, including gold content, collectibility, and aesthetics. The highest value share comes from gold content, so most RCM gold coins are valued and priced based on gold content.
However, in certain cases, collectibility can also play a role, as there are many rare and limited-edition gold coins. The worth of a coin, paper money, or any other type of currency goes beyond its face value and intrinsic metal value – it has what we call numismatic value. This is based on factors like rarity, condition, age, and more that can affect the overall price. Canadian mint gold coins could appreciate in value over time, particularly during tumultuous economic periods when gold typically flourishes as a reliable refuge asset.
It is also important to keep all the certificates and original packages of RCM gold coins. Otherwise, it can be difficult to prove authenticity.
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Buying and Selling Royal Canadian Mint Gold Coins
You can purchase Royal Canadian Mint gold coins directly from the RCM or through authorized dealers, such as post offices and banks. However, it is important to take time to compare prices since post offices and banks may charge significantly more, and coins sold at post offices and banks have low numismatic value and come at high prices compared to their precious metal value.
So, spend your time researching before investing to ensure that the value you get will align with the coin’s price. The higher your value, the easier it will be to sell the coin and even earn money from your long-term investment.
Taxes, Shipping, and Other Considerations
If you’re investing in gold coins – including those sold by the Mint – these are exempt from taxes. However, they must meet certain criteria. The gold purity must be 99.5% or higher, and this includes all modifications made to the coin, including gems and other embellishments. In Manitoba and British Columbia, Provincial Sales Tax is applicable when a coin’s selling price surpasses its face value.
Comparing ETRs and Gold Coins
ETRs provide a viable option for investors who want to invest in gold without the hassle of storage and insurance. Although they do incur management fees, their prices generally follow market trends, so you can expect them to stay close to that of physical gold.Investing in Exchange-Traded Receipts (ETRs) involves costs that differ from other types of investments.
Generally, there’s a brokerage fee when buying ETRs which varies based on the broker. Some online brokers now offer zero-commission trading. You can use our brokerage comparison tool to find the best brokerages with the lowest fees in Canada.
This article is the shortened version of an article originally published on Hardbacon.ca by Yuri Sychov under the title "Are Royal Canadian Mint Gold Coins a Good Investment?".
