The Difference Between Sovereign and Non-Sovereign Products

Both sovereign coins and sovereign rounds and bars have their appeal. Both contain gold or silver, both are stackable, easily portable and very durable. So when it comes time to invest in gold or silver, how do you choose the right precious metal product for you?

The choice between sovereign coins and non-sovereign rounds and bars is mainly a choice of preference and the type of investing you plan to do. Prior to making a purchase you should ask yourself what benefits are essential to you and what your future goals are. Do you want to be able to use your investment as currency? Do you want your investment to carry with it some numismatic value? Both sovereign and non-sovereign products carry with them investment value, but their features and qualities are distinct.

Sovereign Coin Benefits

If you answered yes to both of the questions above then sovereign coins would suit you well. Sovereign coins, have a face value (regardless of their precious metal content) and can be used as currency as well as an investment. An example of a sovereign coin would be a 1 oz Silver American Eagle, or a 1 oz Canadian Gold Maple Leaf.

Sovereign products are also backed by the country that minted them. This means that the United States Mint, or the Australian Perth Mint guarantees the purity and precious metal content in those coins or bars. Because of this trust in the authority that created the product, sovereign gold and silver products are normally easier to sell back because they are recognizable and trusted.

Not only are sovereign products very recognizable, but they can also carry with them numismatic value. A coins value may exceed its precious metal content for a variety of reasons such as its age, condition and most important, rarity.

Non-Sovereign Coins and Rounds Benefits

Non-sovereign coins and bars have some similar benefits as their sovereign counterparts such as portability. But the main area where they differ is that they do not contain a face value and cannot be used as currency.

Non-sovereign coins and bars are normally manufactured by a private mint or a smaller nation government. The value of that product is completely dependent on the purity and previous metal content – there is no numismatic value.

The main benefit of a non-sovereign product is that they tend to have a lower premium over spot price – this means they’re cheaper.

Which to Buy?

If your priorities when investing in gold, silver or platinum are to hold a physical product that has a numismatic and currency-based value, then a sovereign product is more than likely the right product for you. If you prefer for your investments to be tied solely to the precious metal content of your product then a non-sovereign product may be right for you. In any case you can’t go wrong because both products result in a physical coin, round or bar that contains physical precious metal.