British Gold Coins

By Author: Bob Ethan
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British Gold Coins

Among the most well-known lines of gold coins around the world is British Sovereign. Because of their exiting and rich history and cultural value, old Sovereigns are in high demand by coin collectors. And Sovereigns minted in more recent years are of big interest to investors.

The first British Sovereigns were struck in the year 1489 by King Henry the VII. They were valued at one pound sterling, or twenty shillings. However, since they were used for official purposes and not as regularly circulated coins, there is no face value indicated on the coins.

The first generation of British Sovereigns were composed of twenty three carrat gold, in other words 96% pure bullion, and the gold contents weighed 15.6 grams, in other words one half troy ounce. When Henry the Eight was ruler, Sovereigns' purity level was reduced to 22 carats (92% pure), which set the standard of what is now referred to as "crown gold", a standard still commonly used today in Britain and the USA. The amount of gold in them was further decreased on several occasions until it reached 7.322 g, in other words 0.2354 troy ounces.

A ...
... number of varying denominations of Sovereign gold coins have been minted by the British Royal Mint, including half sovereigns with a nominal value of 10 shillings (a half pound sterling), double sovereigns with a nominal value of two pounds sterling, and quintuple Sovereigns with an official value of five pounds sterling Then in 2009 the Royal Mint for the first time has issued 1/4 Sovereign coins with a nominal value of 5 shillings. It is obvious that the official value has nothing to do with their real price in in these modern times.
Gold Sovereigns were minted in large quantities until the First World War, when the pound was removed from the gold standard.Until 1932, Gold Sovereigns were minted strictly at local mints in some commonwealth countries, specifically in South Africa, Canada, Australia, and India.Production was halted until '57.

Starting in 1957 Sovereigns were once again produced, to end the devaluing of the Sovereigns' value by counterfitting crooks.

Until 1982, sovereigns were minted as circulated bullion, but from 1982 to 1999 were released strictly as proofs for numismatists. Since 2000, Sovereign gold coins are again being produced as standard bullion, with value determined primarily by weight in gold.

As mentioned earlier, British Gold Coins have an official value. But their real value is decided both by the present market price of the weight of their gold content as well as variable numismatic value, which varies massively depending on the specific coin and buyer demand.

Bullion coins minted in recent times should in theorycost approximately the market value of their weight plus a minimal premium, but can sell for a lot more. Throughout history, British gold coins were often taken out of circulation by the Royal British Mint and their gold contents remolded into new coins. There were also buybacks of coins that had lost some of their weight in circulation, and were exchanged for full weight Sovereigns. Since so much remolding of old coins took place, old British gold coins are often very rare and have a high value to numismatists.

Sovereigns are treasured because of their historical and cultural value. Collectors love sovereigns and they can have tremendous numismatic value because of their history and rarity.. But old British sovereigns might inappropriate for people who just want to invest in gold not collect it. That kind of investor is better off buying only bullion coins rather than numismatic coins, because they're not very concerned with the coins' beauty. Soverigns minted in recent times would be a better idea.

However, even if you are buying as an investor, one possible downside of these British gold coins is their uneven gold content that measures 7.322 grams, and is not written on the coin. This could make Sovereigns less liquid than a 1 oz. coin, particularly outside of the UKwhere British Sovereigns are widely known. You could certainly take them to a bullion shop and sell them, and they would be recognized by the dealer. But if there is ever an economic meltdown and you need immediate liquidity for daily transactions, sovereigns may not be widely recognized. Undoubtedly, they do make a good investment, but I would nbot rely on them as emergency funds.
Whether you're a collector or an investor or just simply curious, visit The Gold Market and learn more about British gold coins and more.