Article: Lifestyles Magazine Prague: Investing in Czech Gold and Silver Coins
Modern mainstream opinion has generally seen investing in gold and silver as the preserve of doomsters and cranks. Not any more. And even though precious metals have recently experienced a strong price increase, most analysts agree that they still have much further to go.
With all the talk about gold and silver reaching new multi-decade highs, many people are looking for ways to invest and make handsome gains. While it is no secret that both gold and silver are recognized as a solid investment, what is not so well known is that although gold has demonstrated a trend of appreciation since 2001, more than doubling in price, the performance of silver has recently outperformed that of gold. In fact, between July 1, 2003 and November 30, 2006, the price of gold increased approximately 84%, while the price of silver increased more than 200%.
Precious metals are stable in times of worldwide uncertainty. Used correctly, they can be an effective component of a diversified investment portfolio. Still, they are an investment like any others, and have an element of risk (albeit more modest). It’s essential to achieve the proper mix.
When most people think of investing in gold and silver, they think of bullion. Although many people do invest in bullion, there are investments in many different forms – futures, options, mining stocks or mutual funds, for example. In this sense, they have tremendous liquidity and can be bought and sold without problems. However, stock certificates often lack the attractiveness of precious metals; so investing in this metal has a special appeal.
A fun and profitable hobby
Coin-collecting is one example of a relaxing and enjoyable (albeit somewhat expensive) hobby. Coins are the footprints of history, it has been said, and without question it is interesting to hold history in your hand. Back in the middle-ages, Bohemia used to be one of the centers for silver coinage.
A few decades ago, in the 1950s, the typical coin buyer was a numismatist. According to the best tradition, a numismatist was and is a person who buys coins for the intellectual satisfaction they provide. Coin investment was popular then, as it had been for most of the preceding century. However, coin investment was considered as a side benefit to collecting. Forming a meaningful collection was most important, and investment benefits came naturally as part of the package. Today is different – investment is the name of the game.
If you buy properly, coins can be an excellent place to park your money for a rainy day, and if you buy the right coins and the market improves, you may even be able to make a profit on your collection. But people entering the field primarily to make a gain are warned to study before buying. Certain companies, some of whom may advertise on television, in newspapers, or in popular magazines, are alleged to make exaggerated claims about the present and future values of their wares. After learning the basics of the field, it is often possible to make better purchases from reputable dealers.
Anyone who wants to buy gold and silver coins in the Czech Republic can do so without much difficulty. Most cities have coin sellers, and if a buyer is looking for a particular coin or series, dealers will search the market to find them.
Get to know the basics
A good place to learn the basics about investing in coins is the Czech National Bank exhibition “People & Money”, held in the beautiful spaces of the former strong-room at the CNB’s headquarters. The exhibition provides a comprehensive picture of both monetary and financial development in the Czech lands, including the history of the Czech National Bank since its foundation. It is also the best address to purchase Czech commemorative coins both in gold and silver.
“Investing in silver bullion seems to be growing in popularity,” said Marie Šebestová from the Czech National Bank’s Money Museum. “Both in coins and bars that can be stored somewhere safe where they can grow in value, and someday be used by the investor or his heirs. Precious metal values may move up and down some over time, but they will never experience the sharp rises and declines that paper money or stocks are capable of, so it makes a solid object for investment.”
