Gyroscopic Investing

Preface:  Please note that I have no any relationship with any of the companies I mention below. 

Below is my Reader’s Digest version of how and where to get the best deals on precious metal coins.  Keep in mind the following is just my opinion.  Anyone contemplating a purchase of precious metals by reading this assessment needs to do their own due diligence, research the claims I make, compare dealers for cost and reliability, and purchase as they deem prudent, not necessarily as I deem prudent. 

1. Begin your research at goldprice.com and goldshark.com.  These two websites search out prices at various listed dealers so you can see the differences in dealer markup on bullion coins. 
2. It’s also probably a good idea to check the various precious metal website forums for opinions on various dealers and current special sales.  Here’s a few forums to visit:
http://forum.bulliondirect.com/index.php
https://www.kitcomm.com/
http://www.bullionstacker.com/
http://www.goldismoney2.com/forum.php
3. Below is a chart I made comparing the sell/buy prices at dealers with the tightest spreads I have found:

Kruggerand Gold Eagle Gold Maple Gold Buffalo
Goldmart +30/+10 +58/+35 +35/+15 +60/+41
Tulving +30/+12 +60/+34 +38/+18 +60/+36
Provident +50/+8 +82/+34 +50/+12 +84/+36
Gainesville +48/NA +68/+33 +42/+15 +63/+33
Texas PM +40/NA +70/NA +45/NA +70/NA

Silver Eagle Silver Maple Buffalo Round Junk Silver $1000 Face Value
Goldmart +2.79/+1.70 +2.35/+1.30 +1.15/+0.15 -0.30/-1.46
Tulving +2.79/+1.70 +2.19/+1.60 +0.99/spot -0.30/-1.50
Provident +3.19/+1.65 +2.89/+1.40 +1.19/-0.30 +0.10/-1.50
Gainesville +3.06/+1.10 +2.85/+1.34 +1.25/+0.10 +0.10/NA
Texas PM +2.88/NA +2.78/NA +0.99/NA   NA/NA

Note: Prices are above spot (+) or below spot (-)
Note:  I use the price listed for a 500 coin purchase of Silver Eagles, Maples, and Buffalo rounds
Note: all dealer markups as quoted on 27 Aug 2011.

4. The following is a brief discussion of the dealers mentioned above. 
Tulving: Tulving has been in business since the late 1970’s and over the years has developed the reputation as the lowest cost dealer online.  I couldn’t find a rating on them by the BBB and Tulving did go bankrupt in the early 1990’s.  Still, most forum members swear by them for their prices and turnaround time.  Note that they have extremely high minimum purchase requirements
Goldmart: Goldmart is a recent startup business that began operating about 1 year ago so they don’t have much of a track record.  As noted above, they rival Tulving for the tightest spreads.  Rated “A”? by the BBB.  They have no minimum purchase requirement.  There have been some complaints about slow delivery.
Provident/Gainesville Coins/:  These companies seem to be well known and well liked companies which offer competitive prices for their products and good service.  All three are rated “A”? by the BBB. 
Texas Precious Metals:  I found little discussion of this company on the forums.  Rated “A”? by the BBB.  Their website says they had previously been precious metal wholesale seller to dealers since 2004.  Recently  they began selling directly to end customers. 

Many people prefer to buy from their local coin shops.  If you do this, you’ll pay a higher price but some feel more comfortable dealing with someone face to face or feel uncomfortable transacting in large sums of money over the internet.  If you order online, perhaps the best approach is to place a few small orders first to see how the different perform for you.  Once you feel more comfortable with the process, you can move up to larger purchases.  Then you’ll have a better idea of what to expect.  Bottom Line:  Buy your coins from a dealer with whom you feel comfortable.  But please shop around and get the best price.  w

Of course, this is just my opinion.  I could be wrong.

This seems like a very good initial list for the spreads between buy/sell for different places. I'm thinking of going with Goldmart for my first gold coins (since they are seeming the cheapest) and right now they are running a special on free shipping if over $5000 purchase.

There was an old thread that spoke a bit about the bid/ask spreads but any idea how often these change over long period of time? Or I guess the other question would be, if the bid/ask spread stays roughly the same difference between the two and just either moves up or down, would it make the most sense to go with the lowest coin (Krugerrand) over spot? It might be worthwhile to have various coins just in case over time one is favored over the other (so having potentially Eagle and Krugerrand. Potentially either Buffalo or Maple but I worry about if I'll stratch 24k gold.

Thoughts?

Someone told me that if you need to leave the country with your gold then there is an advantage in owning US gold coins like the Eagle because it can be declared at face value of $50. Is this true?

Reub,

Here's an article you might find interesting. At the end of this thread it speaks about what you mentioned about taking gold out of the country.

https://www.kitcomm.com/archive/index.php?t-71229.html

It'd be worthwhile however for a second source citing this knowledge. I'll be on the lookout.

-Greg

Update: Found this. It looks like if the face value states $50 on a coin, that that is the value used for the $10,000 limit. I'll be checking though. Here's the document that is needed if you travel with more than $10k of face value moneys to another country.

http://www.fincen.gov/forms/files/fin105_cmir.pdf

Reub wrote: Someone told me that if you need to leave the country with your gold then there is an advantage in owning US gold coins like the Eagle because it can be declared at face value of $50. Is this true?

Its no longer true in practical terms.  Custom officials are wise to it.  Any market value of $10K+ has to be declared, or you risk civil forfeiture.  Do you really want to argue with them or the TSA and risk it, especially in the middle of a crisis?

You also have to file another form because you are exporting the gold.  And then there are forms and penalties at the receiving country's end if not all properly followed.  So you better know WTF you are doing both ways to one before you even attempt it.

1NV3ST0R wrote: This seems like a very good initial list for the spreads between buy/sell for different places. I'm thinking of going with Goldmart for my first gold coins (since they are seeming the cheapest) and right now they are running a special on free shipping if over $5000 purchase.

Have you seen this as it compares prices from 10+ dealers: http://www.goldprice.org/gold-prices/

Now I know you're new to the PP, but you're correct that you want to pay the lowest premium possible above spot.  However keep in mind that certain gold bullion coins have to be reported when sold, so that would exclude things like the Krugerrand, etc..  But you'll have to double check on the specifics as my memory is spotty on the specific coins.

If you want some more upside kicker potential than with regular bullion, take a look at the brilliant uncirculated (PCGS MS60+), semi-numismatic Liberty and St. Gauden's gold bullion coins minted from the mid 1800's to 1933.  The have extremely low historical premiums right now, about 9% above spot.  I believe back during the Y2K crisis, plain ol', modern American Gold Eagles had a 50% premium above spot!  (Incidentally, Eagles use the beautiful front design from the St. Gaudens.)

In my book, I-Bonds and St. Gaudens are that proverbial free lunch right now.  The former will save you from inflation, but the latter could potentially get you dirty rotten filthy stinkin' rich.

Thanks for the links MachineGhost. It still looks like GoldMart is still cheaper by just a few dollars, and with free shipping, it seems that it beats the other ones on that list. Good to know though in case price leaders change in the future.

I'll have to see about Krugerrands, but isn't that there is a form that merchants/you have to fill out if you purchase more than $10k in a year? Not sure how easily you can then purchase more than that if you use other dealers.

And I'm not sure if I'm ready for a numismatic coins yet. I want to dip my feet in the water and get comfortable before I start splashing around. But thanks though, I'll keep the thoughts in mind.

1NV3ST0R wrote: I'll have to see about Krugerrands, but isn't that there is a form that merchants/you have to fill out if you purchase more than $10k in a year? Not sure how easily you can then purchase more than that if you use other dealers.

Machine Ghost/1Nv3stor,
I think the link below will answer your questions.

http://www.onlygold.com/faqcenterpages/ ... ndgold.htm

BTW it seems there has been a huge run on bullion coins lately.  Tulving and Texas Precious Metals have sold out on Eagles and Buffalos.  Tulving does have Maples at +26 over spot right now which seems the best deal if you can swing the 20 coin purchase requirement.

Sadly, Goldmart and Texas Precious Metals don't post their buy back prices online anymore.  It might be a good idea to check out companies like Apmex and Provident that still do post their buy back prices in real time.  If you check all the companies I listed in my original post you'll see a buy/sell delta of $20-25 is normal for almost any type of coin.  I'd consider any smaller delta you find for a particular coin to be a prime candidate for purchase.

JMHO  

FarmerD wrote: BTW it seems there has been a huge run on bullion coins lately.  Tulving and Texas Precious Metals have sold out on Eagles and Buffalos.  

It's the same here in the UK, glancing at one of the lower margin gold dealers that also publish their stock levels;
http://www.hattongardenmetals.com/buy-gold.aspx

There havent been any Sovereigns available for months, and lately there haven't even been Krugs or even bars.
Clearly, there must be all you want at higher margins but I still find it curious that you can have all the paper you want but physical you have to work a bit harder for at the moment.

gizmo_rat wrote:

FarmerD wrote: BTW it seems there has been a huge run on bullion coins lately.  Tulving and Texas Precious Metals have sold out on Eagles and Buffalos.  

It's the same here in the UK, glancing at one of the lower margin gold dealers that also publish their stock levels;
http://www.hattongardenmetals.com/buy-gold.aspx

There havent been any Sovereigns available for months, and lately there haven't even been Krugs or even bars.
Clearly, there must be all you want at higher margins but I still find it curious that you can have all the paper you want but physical you have to work a bit harder for at the moment.

The price of gold has been going down as well.  I conclude large institutions must be selling lots of gold and small investors are snapping up as much gold as they can.  I've read the European banks are selling gold to raise money because of their liquidity crisis.  Perhaps, in the short run gold will continue to fall while the banks are selling then you may see a big spike upward when they stop.