South African Gold Krugerrand Coins
The South African Mint's gold Krugerrand was one of the earliest legal tender one troy ounce gold coins. Investors are still drawn to this 22-karat gold gem because of its rich history and diversification possibilities.
Gold Krugerrand Coin's History
To encourage the "man on the street" to invest in actual gold, the South African Chamber of Mines introduced the Krugerrand in the 1960s. Coins containing one troy ounce of pure gold alloyed with copper were first issued as lawful currency in 1967. A gold-copper alloy is used in the coin's production to increase the coin's durability. The face value of this gold coin was linked to the current gold price, hence it had no fixed value.
However, the coin's name is partly derived from the South African currency's name, "Rand." Paul Kruger, the nation's first and only president, appears on the other side. Mass production of the Krugerrand allowed for a minimal premium above gold's existing price. Half-ounce, quarter-ounce, and tenth-ounce Krugerrands were introduced in 1980 to make the Krugerrand more accessible to investors who previously had difficulty getting their hands on the precious metal.
Design of the Gold Krugerrand
This coin is named after South Africa's fifth president, Paul Kruger, and is produced by the South African Mint. While serving as South Africa's prime minister during the Second Boer War, he championed his country's interests in the face of Great Britain. As a folk hero who is willing to give up his life for his people, some compare him to him. A more negative view of him is as an intransigent leader who stood up for an unfair cause. Kruger served in the administration for more than 40 years and was president for nearly two decades.
The obverse and reverse of the South African Gold Krugerrand coin have traditionally featured the same design features. Only the photos used on either side have been updated in the five decades of manufacture.
Collectors and investors can find a portrait of Paul Kruger on the coin's obverse, along with the country's name in both English and German. The South African national animal, the springbok antelope, appears on the coin's reverse. The design pays homage to both South Africa's political and environmental history, and it does it with exquisite attention to detail.
According to the reverse, the piece is minted from one ounce of pure gold. Each Gold Krugerrand Coin bears the year of mintage.
The South African Gold Krugerrand's Minting History
As of 1967, the South African Gold Krugerrand was only available in limited quantities each year. The annual limit was 40,000 coins from 1967 to 1969. The growing popularity and a great demand for the Gold Krugerrand aided in increasing the mintage in 1970. The 1970 edition produced 200,000 coins, whereas the 1978 issue produced 6 million pieces. Following apartheid, South Africa's output has been significantly lower than in the 1970s. There were only 23,277 coins made in 1998, for example.
Is it worthwhile to get South African Gold Krugerrands?
In light of the fact that these gold coins are constructed of 22K rather than .9999 purity, some collectors may be cautious about investing in this particular piece. On the other hand, there isn't a more well-established gold coin on the world market today. Coins with proven quality and an eye-catching design make these a desirable addition to any collection. Even though they were made to entice investors in a closed economy, gold coins struck as a result of those efforts are today in high demand around the world.
The Mint of South Africa
South Africa's first national mint, the South African Mint, was established in 1890. After joining the Royal Mint in 1923, it regained its independence as an independent mint in 1941. In terms of refining and melting of precious metals, the Rand Refinery is the largest single-site operation in the world. Founded in 1920, it is the exclusive owner of the trademark "Krugerrand" for a gold refinery in South Africa.
The 1 Troy oz South African Gold Krugerrand coin may have been the first of its kind, but it wasn't the only one. The Gold Krugerrand was the most popular gold coin in the world in 1980, with a market share of 90%. The South African Mint has enlarged the collection to include three fractional-weight pieces: 1/2 oz, 1/4 oz, and 1/10 oz in response to the coin's growing popularity. All four types are still being produced today, with a gold content of 22 karats (91.67 percent).
Investing in the Krugerrand Gold Coin
For gold investors, Krugerrands remain a popular investment because of their value and tiny size, which allows for easy storage. Gold bullion, hedging against the U.S. dollar, and portfolio diversification are all reasons why Krugerrands are attractive to professional and private investors.
Due to the fact that gold's value has remained stable for so long, investors continue to acquire it. Gold is viewed by many as a secure investment, even in the event of a global economic downturn. Some investors prefer to own actual assets, such as coins or bars, rather than investments that exist only on paper.
If you plan to buy Krugerrands, you'll need a safe place to keep them safe. Be aware of scammers, find a reliable gold dealer, and familiarize yourself with your state's tax regulations, which may include a gold sales tax. Investing in gold has a number of advantages that some investors may find appealing:
- A lot of gold is traded on the open market.
- The value of your gold investment is not tied to the profitability of a gold mine.
- Because gold is a finite and nonrenewable resource, it has historically provided positive returns and seen an increase in value.
- This makes gold an excellent asset for diversifying a portfolio because of its low-to-negative correlation with other types of investments.
See also: List of Best Gold Coins
Not an IRA Approved Gold Coin
The gold Krugerrand coin is not eligible for a gold rollover to IRA.
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