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Posted in Money

Gold Eagle vs. Krugerrand

Gold Eagle vs. Krugerrand

At a Glance

The Gold Eagle and Krugerrand are two of the most recognized gold coins in the United States. When you attempt to sell a Krugerrand, though, you may find that the premium you paid when buying no longer holds up.

Most of the investors who enter the gold market for the first time wonder about the differences between the American Gold Eagles vs. the South African Krugerrand gold coins. The Krugerrand is one of the world’s most famous bullion coins, produced during a time in which it was still illegal to invest in gold bullion in the United States. However, the Gold Eagle — a product of the United States mint — has since overtaken the Krugerrand in popularity. There are some differences between these coins which investors should be well aware of. One thing most investors notice in the first glance is that the prices of these two gold coins often vary.

General Characteristics

Pictured at top: 1/10 Ounce American Gold Eagle

As mentioned earlier, Krugerrands are South African gold bullion coins. Krugerrands have been minted since 1967. As a result, they are the oldest minted gold bullion coins that remain in production today. On the other hand, Gold Eagles are American gold bullion coins. They have been minted in United States of America since 1986. In fact, they are the most popular gold bullion coins in America.

Appearance

On the face of a Krugerrand, you can see the portrait of South Africa’s President, Paul Kruger. On the back, a Springbok Antelope is clearly visible. A standard Krugerrand weighing one ounce is just 32.77 mm in diameter. It is 2.84 mm thick. On the other hand, the Gold Eagle features a portrait of walking Lady Liberty. This image is on the front. On the back, you can see an eagle soaring on top of a nest. Gold Eagles are 32.70 mm in diameter. They are 2.87 mm thick. The design of the Gold Eagle is based on that of the famous Saint-Gaudens Double Eagle from the early 1900s.

Design

There is no doubt that the Krugerrand was used for inspiration when the proportions of the Gold Eagle were decided upon. Even the diameter and thickness are similar to each other. If you weigh an American Gold Eagle, it comes out to be 1.0909 Troy ounces. This is exactly one troy ounce pure gold. One basic difference between the design of both these coins is that the American Gold Eagles uses an alloy of copper and silver. On the other hand, Krugerrands only use an alloy of copper. Gold Eagles are more durable and shinier than dark Krugerrands.

Purity

Krugerrands and Gold Eagles are made of 22-karat gold. As a result, they are 91.67% pure gold. Because pure gold is impractical for bullion coins due to durability issues, but coins are alloyed with other metals for extra hardness. As a result, both coins weigh a bit more than an ounce so both can contain a full Troy ounce of pure gold.

Gold Eagle vs. Krugerrand: Which is Better?

In 2013, there has been a sharp drop in gold’s prices after a long, steady rise over the past several years. As a result, less investors are planning to sell Krugerrands. Thus, they have been a little scarce in the American market. Moreover, the U.S Mint has been unable to supply an appropriate amount of 1 ounce Gold Eagles. It is important to understand that once gold prices move up and the bullion houses are done with their manipulation of the market, premiums of secondary market Gold Krugerrands will significantly fall. This will happen as soon as sellers return to the market. On the other had, Gold Eagles have always maintained solid premiums. Thus, it is generally thought in the United States that Gold Eagles are superior vs. Krugerrands. Once sellers return, premiums of Gold Krugerrands are likely to shrink.