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If you're going to keep some money in cash, is there any downside to keeping it in gold coins that you can buy at their face value, where that face value is higher than the metal value?

I came across this €1000 coin, which can actually be bought for €1000. It contains 17 grams of gold, worth about €600 today. Is there any downside to this over keeping €1000 in regular banknotes? (Other than the practical challenges of getting a bank to accept it, I guess.)

The potential upside is, of course, that the metal may eventually be worth more than the face value. (Of course, if you're keeping many of these for a long time there would be some storage costs, like with any physical metal.)

Rodrigo de Azevedo
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EM0
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1 Answers1

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I came across this €1000 coin, which can actually be bought for €1000. It contains 17 grams of gold, worth about €600 today. Is there any downside to this over keeping €1000 in regular banknotes?

These are bullions / medallions / collectibles / Non Circulating Tenders or whatever name one wants to call it. A coin has a value because the Central Banks says so that enforces everyone accept it at that.

This as such is not a coin. Banks or anyone else will not accept this for face value.

These are of numismatic interest and certain people do collect such items. They are collectibles to the extent the price is dependent on general interest in future on such items and quantity available. So if future the price may go up much higher than the gold price or may retain its gold price.

Mints make these with intricate design, best finish, limited quantity to charge the additional premium.

If you are not into numismatics, stay away, a better options is buy simple gold bullion of similar weight for actual gold price.

Dheer
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