DEFINITION of 'Bullion Coins'

Coins made from precious metals that are generally used for investment purposes. Bullion coins are usually made from gold and silver, and may also be available in platinum and palladium. Many countries have their own official bullion coins, such as the American Eagle series of coins available from the Unites States Mint, and the Canadian Maple Leaf series offered by the Royal Canadian Mint. They are typically minted in weights that are fractions of one troy ounce to fit a variety of budgets.

BREAKING DOWN 'Bullion Coins'

Bullion coins appeal to investors who are looking for an investment that has stood the test of time as a store of value for thousands of years. The steady rise in gold prices starting in 2000 has spurred tremendous interest in bullion coins in recent years.

Bullion coins may command a premium in the market place as compared to the spot price of the underlying precious metal on global metal exchanges. This premium may be attributed to an underlying demand for bullion coins, as well as their relative liquidity, small size (which facilitates storage) and the costs involved in manufacturing and distributing them.

American Eagle gold bullion coins are among the most widely traded bullion coins in the world. These coins are minted from 22 karat gold (91.67% purity) and are available in four weights – 1/10, 1/4, 1/2 and 1 troy ounce. Other popular gold bullion coins are the Canadian Maple Leaf, South African Krugerrands and Chinese Gold Pandas.

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