First of all, they’ve been around for hundreds of years so enjoy a very well established reputation and deep developed secondary trading market. This means they’re easy to sell anywhere globally. The very fact that there are a huge number in circulation throughout the years also means a buyer has a great choice when buying. This contrasts with another UK coin, the Britannia, which has only been around for 20 or so years. So buyers generally only have the choice of brand new coins.

As a relatively small coin, they offer the chance of owning a larger number and variety than 1oz coins. Variety and diversity are always good benefits when you’re seeking a balanced gold portfolio. Because you get roughly 4 Sovereigns to an ounce it is easy to liquidate the portfolio in smaller fractions. This increased divisibility offers the investor a high degree of flexibility with their gold coins. It is also easier to find buyers of coins worth ?200 or so than ?900.

A major selling point of Sovereign gold coins is their tax free status. As a 22 carat coin Sovereigns are classified as investment gold and so are VAT exempt. This contrasts to some other forms of gold such as jewellery and gold nuggets, and indeed other precious metals such as Silver and Platinum which all attract VAT of 20%.The real bonus with Sovereign coins is that they’re also Capital Gains Tax free for UK residents. As legal tender in the UK, the Government don’t tax the movement of legal currency. This means that unlike some great foreign coins like the Krugerrand and Maple Leaf, investors get to keep 100% of their profits upon disposal rather than pay up to 28% to the tax man!

So the case for buying Sovereigns is strong, but you still need to ensure you’re getting the best value for money. Almost always avoid buying proof Sovereigns if you’re an investor. You can pay 15-30% premium over bullion coins and will likely receive a fraction of this benefit when you come to sell. You should only consider proof coins if you’re paying close to the bullion price or if you’re a collector. If you’re considering choosing between full Sovereigns and half or quarter Sovereigns, then always go for a full Sovereign if you can afford it.

You’ll likely pay a higher premium for the smaller fractional coins equating to less gold for your money. I also think there is less demand for the half and quarter Sovereigns as they really are very small coins. Conversely I think the ?2 ‘double Sovereign’ and ?5 ‘quintuple Sovereign’ represent good options.Finally, you need to ensure you buy the right age of Sovereign. This rule is relatively simple. Right now brand new Sovereigns remain expensive in my opinion. While they are beautifully finished you can pay 5% or more on top of second hand prices. Like buying a car, that coin will not be the latest mint year within a year, so will represent bad value.

I don’t see a huge difference in the various years of issue in second hand Sovereigns. In fact I see value in holding a nice mix of coins, whether they be Elizabethan, Edwardian, Georgian or Victorian. As long as the condition is decent, it can be beneficial and enjoyable to hold coins from a number of eras. Some dealers may pay a little more for Edward VII Sovereigns purely because of his short stay on the throne but the difference is marginal.All our semi-numismatic Sovereign coins are of at least selected quality which means we handpick our coins for a large number, rejecting those that may be showing their age more than others. Happy investing!

Learn more about coin values or old coins worth

First of all, they’ve been around for hundreds of years so enjoy a very well established reputation and deep developed secondary trading market. This means they’re easy to sell anywhere globally. The very fact that there are a huge number in circulation throughout the years also means a buyer has a great choice when buying. This contrasts with another UK coin, the Britannia, which has only been around for 20 or so years. So buyers generally only have the choice of brand new coins.

As a relatively small coin, they offer the chance of owning a larger number and variety than 1oz coins. Variety and diversity are always good benefits when you’re seeking a balanced gold portfolio. Because you get roughly 4 Sovereigns to an ounce it is easy to liquidate the portfolio in smaller fractions. This increased divisibility offers the investor a high degree of flexibility with their gold coins. It is also easier to find buyers of coins worth ?200 or so than ?900.

A major selling point of Sovereign gold coins is their tax free status. As a 22 carat coin Sovereigns are classified as investment gold and so are VAT exempt. This contrasts to some other forms of gold such as jewellery and gold nuggets, and indeed other precious metals such as Silver and Platinum which all attract VAT of 20%.The real bonus with Sovereign coins is that they’re also Capital Gains Tax free for UK residents. As legal tender in the UK, the Government don’t tax the movement of legal currency. This means that unlike some great foreign coins like the Krugerrand and Maple Leaf, investors get to keep 100% of their profits upon disposal rather than pay up to 28% to the tax man!

So the case for buying Sovereigns is strong, but you still need to ensure you’re getting the best value for money. Almost always avoid buying proof Sovereigns if you’re an investor. You can pay 15-30% premium over bullion coins and will likely receive a fraction of this benefit when you come to sell. You should only consider proof coins if you’re paying close to the bullion price or if you’re a collector. If you’re considering choosing between full Sovereigns and half or quarter Sovereigns, then always go for a full Sovereign if you can afford it.

You’ll likely pay a higher premium for the smaller fractional coins equating to less gold for your money. I also think there is less demand for the half and quarter Sovereigns as they really are very small coins. Conversely I think the ?2 ‘double Sovereign’ and ?5 ‘quintuple Sovereign’ represent good options.Finally, you need to ensure you buy the right age of Sovereign. This rule is relatively simple. Right now brand new Sovereigns remain expensive in my opinion. While they are beautifully finished you can pay 5% or more on top of second hand prices. Like buying a car, that coin will not be the latest mint year within a year, so will represent bad value.

I don’t see a huge difference in the various years of issue in second hand Sovereigns. In fact I see value in holding a nice mix of coins, whether they be Elizabethan, Edwardian, Georgian or Victorian. As long as the condition is decent, it can be beneficial and enjoyable to hold coins from a number of eras. Some dealers may pay a little more for Edward VII Sovereigns purely because of his short stay on the throne but the difference is marginal.All our semi-numismatic Sovereign coins are of at least selected quality which means we handpick our coins for a large number, rejecting those that may be showing their age more than others. Happy investing!

Learn more about coin or half sovereign

The first gold sovereigns were 23 carat gold (96% percent pure) and contained 15.6 grams, or one half troy ounce, of gold. King Henry VIII, reduced their purity to 22 carats (92% pure), which defined the standard that is now referred to as “crown gold”, a common standard for gold coins in both the UK and the US. The gold content was reduced several more times and fixed at 7.322 grams, or 0.2354 troy ounces, where it remains today.

The British Royal Mint has released various additional denominations of gold sovereigns, including half sovereigns with a nominal value of 10 shillings (a half pound sterling), double sovereigns with a nominal value of two pounds sterling, and quintuple sovereign coins with a nominal value of 5 pounds sterling. And in 2009 the Royal Mint for the first time has issued quarter sovereigns with a nominal value of 5 shillings. Obviously the nominal value has nothing to do with their real value in modern times.

Gold Sovereigns were produced in large numbers until World War I, when the British pound was removed from the gold standard. Until 1932, sovereigns were produced only at branch mints around the British Commonwealth, specifically in Melbourne, Sydney, Perth, Bombay, Ottawa, and Pretoria. Production was then halted until 1957, when gold sovereigns began to be minted once again, to prevent the debasing of the coins value through counterfeiting.

Until 1982, sovereigns were minted as regular bullion, but from 1982 to 1999 were produced only as proof coins for collectors. Since 2000, Sovereigns have once again been minted as bullion coins, whose value depends mainly on their weight in gold, and not on numismatic prestige.

As mentioned earlier, British Gold Sovereign coins have a nominal value. But their real value is determined both by the current market price of their gold content plus variable numismatic value, which varies massively depending on the specific coin and buyer demand. Newly minted bullion coins should theoretically cost approximately the market value of their weight in gold plus a minimal premium, but older sovereigns can sell for much more. Historically, British Gold Sovereigns were regularly removed circulation by the Royal Mint and their gold content reminted into new coins. There were also buybacks of coins that had lost some of their weight in circulation, which were exchanged for full weight sovereigns. Because of this history of reminting, old British gold coins often have extraordinary numismatic value because of their rarity.

Collectors love sovereigns and they can have tremendous numismatic value because of their history and rarity. But these same strengths make old British sovereigns inappropriate for simple investors. Such investors would be better off staying away from numismatic coins and buying only bullion coins, whose value depends on their gold content rather than rarity or aesthetics. Bullion sovereigns minted in recent years would be appropriate. But even if buying bullion sovereigns as an investor, one potential pitfall of sovereigns is the unusual gold content of 7.322 grams, or 0.2354 ounces, which is written nowhere on the coin. This makes British sovereigns less liquid than a standard weighted one ounce gold coin, at least outside of the UK. They can probably be sold to most bullion dealers, because they will be familiar with them. But if there is ever an economic meltdown and you need immediate liquidity for daily transactions, sovereigns may not be widely recognized. They still make a solid investment, but as an emergency supply of real physical money, other one ounce coins are probably a better choice.

Learn more about old coins or coin