The Royal Mint is offering investors the opportunity to purchase gold and silver coins with the launch of a new website.
Traders will be able to buy single gold Sovereigns costing £197 while larger gold Britannias are priced at £800 and silver coins will cost £19. The Mint has launched the new website to help expand its bullion business but investment analysts have urged traders to err on the side of caution when purchasing these precious metals.
One of the main concerns from analysts is the volatility in the gold market with the bullion prone to unexpected drops every now and then. Speaking to the BBC, Surrey-based financial adviser Martin Bamford highlighted the risk attached to something that does not have any income linked to it. He stressed that it was important for investors to be wary when making a purchase like this.
The World Gold Council estimates that the UK is home to a £4 billion untapped market for gold prompting the Mint's decision to encourage people to invest in the sector. To qualify for the Mint's scheme investors need to be committed to purchasing at least 25 Sovereigns, around £4,711, or a tube of ten Britannias which are slightly larger than an imperial ounce.
At the moment, the price of gold on the futures market stands at $1,214 (£743) an ounce but has gone through some volatility in recent times. The figure is £400 lower than three years ago and prices recently dropped against a strong dollar.
In early September, the price fell to a two-and-a-half month low as the ICE US Dollar Index grew 0.23 per cent to 82.97. It prompted December gold futures to decline by 1.14 per cent to $1,272.6 on the New York Mercantile Exchange. This volatility highlights the need for investors to be extremely careful when purchasing gold bullions from the Royal Mint.
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