Reasons Why You Should Invest in Krugerrands Available From ISA Gold in Johannesburg
Many associate the Krugerrands of Johannesburg with the year 1967 when the first Krugerrand was minted and became an investment icon. The coins, however, of which well over fifty million have been minted over the years, have a long and interesting history steeped in excitement and war.
When the Golden Arc was first discovered in Johannesburg, the large deposits of gold attracted gold diggers from around the world and shortly after, war erupted over the main control of the gold. Britain and the Boers fought two wars, with the second one ending in 1902.
The face of Paul Kruger, the president of the Republic of Transvaal at the time of the Second Anglo-Boer War, featured on the surface of the first set of Krugerrands. The gold coins consisted of a mixture of gold and a bit of copper for strength, which gave them their unique colour. Modern day Kruger coins are still made to last forever and feature exceptional beauty.
What made the year 1967 so special?
It was the year in which 40 000 Kruger coins were stamped in addition to specially made collector proof Kruger coins. The coins haven’t lost their lure and have been reported to be amongst the most sought after gold bullion coins globally.
Original Role of the Rand Refinery
The Transvaal Chamber of Mines established the Rand Refinery with the sole responsibility of gold refining and today this is the largest gold refinery site globally.
Lure of Krugerrands
The American citizens by law could not own any form of gold bullion, but they could possess coins from other countries. South Africa saw an opportunity and crafted the Kruger coins to be valid tender with the weight stamped on the coins. This made it possible to trade in gold without the need to melt the gold. The first miniature Kruger coins came on the market at the start of the eighties which made it easier for investors to buy the coin of choice based on the current gold price.
Why is investment in Krugerrands a good idea?
News reports of 2013 indicated a rising interest in Krugerrands, mostly because of a weaker gold price. With a weaker gold price, investors get to buy the coins at lower prices, giving them more opportunity to realise a profit on their investment quickly. Of course, the news of Cyprus selling off gold in order to help sustain the banks also contributed to the sudden high interest in the coins. The coins are popular, not so much for speculation purposes, but for the long-term investment value and of course, investors love the idea of having something tangible in return for their investments.
South Africans especially appreciate the coins because of the vulnerability of the South African currency and ongoing depreciation of the Rand due to unrests, strikes and lower investor’s confidence. People who make use of such times to invest in Krugerrands benefit the most because of the potential value increase.
Krugerrands are an excellent hedge against the vulnerabilities of the Rand and are also a good buy even when compared with investment in other types of assets. Most buyers only invest a small portion of their investment portfolio in Krugerrands, which is wise since it is better to diversify risks than putting all your money into a single type of investment.
With the demand for gold being almost always higher than the supply, one cannot argue with the wisdom of putting at least a portion of your investment in Krugerrands. For smaller investors there is no better way to invest directly in gold bullion and because gold is a solid investment, it is an excellent security in tough economic or political times. It is the cheapest way for South Africans to stock up on security and because there isn’t a limit to the amount that one can hold, you can invest as much as you want.
Many people buy gold and specifically Krugerrands from ISA Gold in Johannesburg as insurance against the unforeseen, especially because it is such a liquid investment. Contact us today to enquire about the various options for buying highly valuable Kruger coins.