One of the big risks involved in investing in gold coins and bullion is the possibility that you may come across a bogus gold product. Counterfeiters are very crafty and often can pull the wool over the eyes of pros in the gold game. There are a few precautions gold investors can take to authenticate their gold coins and bullion, however.
The easiest way to authenticate any gold coins and bullion you may have is to take them to a professional. Coin graders with credentials from the Professional Coin Grading Service can verify the authenticity of gold coins with a great deal of accuracy. However, they don’t do this for free. For coin collectors and bullion buyers who want a more cost-effective options for evaluating their gold, here’s a few methods.
For coins, there are a variety of manuals available giving the specs on a wide variety of coins. Read up on the coins and then apply what you’ve learned to the coin in question. Measure it, weigh it and compare the art with that in the book. Gold coins and bullion are made to exact size specs, even more historical coins, so if the coin is off, it’s probably bogus.
You can also verify authenticity by looking at the surfaces of the gold coin. Bogus coins are usually very dull or extremely shiny. Fake coins often have a yellowish tint that differs from the color of gold. Also, fake coins are often less detailed than real coins as many are made from molds made from real coins. If possible, compare a questionable coin with a real coin.
Coin collectors may also test for authenticity by dropping the coin onto a hard surface. Real coins will produce a ringing sound, while fake coins will only produce a dull thud. Don’t try this with coins where the quality of its design is a factor in its value as it may damage the coin. For bullion coins, this test is fine, however.
Simply feeling the coin may also be a good indicator of its value. Fake gold coins or bullion will usually have a slippery feel, or have edges that are sharp. It helps to have an authentic coin to evaluate the other coin against.
With gold prices recently crossing the $1,300 per ounce mark, there’s little wonder that gold coins and bullion are becoming a popular investment commodity. However, before spending thousands of dollars on coins, be sure to do your homework to ensure you don’t get taken advantage of by shady dealers.
