To the untrained eye, one round disc of official-looking metal looks the same as another, but, while they might look similar coins and rounds serve two very different purposes.
Coins are minted by national mints and are accepted as legal tender in the country or region there are issued from. American nickels, dimes and quarters are coins, as are Gold Eagles or Canadian Maple Leafs. That means, gold coins can be used as money and used for transactions just as readily as quarters or dollar bills.
However, investment coins such as Eagles or Maple Leafs are almost never seen in circulation (you’ll almost never see anyone pay for groceries with a Maple Leaf), but they must be accepted as payment just like any ‘regular’ coin.
Rounds, on the other hand, are valued by the amount of precious metal they contain. They do not have a set value, are not backed by any government, nor do they have to be accepted as legal tender. Another key difference between the two is that rounds can be minted by private mints, while coins must be minted by government-owned mints.
Why Buy Gold Rounds?
Since the value of a round is based on the amount of precious metal it contains, buyers who choose to invest in bullion rounds rather than coins are investing more in the value of precious metal than any numismatic, or collectable, attributes. Over spot prices on bullion rounds, like that of ingots and bars, are usually very low and rounds will never gain or lose value based on rarity.
Rounds make a good investment for a buyer looking to bet on the value of gold, but, either for reasons of cost or security, are not interested in buying large amounts in the form of bars or ingots. This is a particularly attractive attribute of rounds, because it allows individuals with limited funds to enter the gold market and steadily increase their stake by gradually buying more and more. In addition, rounds are also very easy to find and sell.
Gold rounds are available in a range of sizes, the most common being ½ ounce, ¼ ounce and 1/10 ounce. Rounds carry some of the lowest premiums in the industry, making them a cost-effective investment for beginner and seasoned investors.
Rounds from reputable private mints such as APMEX are ornately designed with culturally-relevant motifs such as the eagle and the US flag, and stamped with the company’s logo. A gold round from a renowned dealer may be struck from 0.9999 fine gold, with the purity engraved and guaranteed by the mint.
Rounds can be harder to find than bars or coins, but don’t be tempted to pay more than you have to. Remember, rounds hold no value beyond their weight in the precious metals they contain, so never pay more that barely over spot prices for them. Beware of commercially sold rounds (like those sold on TV late at night) or ‘special’ mintings. Many companies will market gold rounds as collectable or rare when they are anything but.