A mate of mine does some cash work from time to time and uses the cash to buy gold sovereigns to put aside for a rainy day.
He reckons that with the economy going downhill, the value of sovereigns will go uphill.
Any thoughts?

_________________
Laird

If all else fails, use 6 inch nails

If it's gold gold and not just a plating (don't know what soverigns are), then yes - I don't think you can go wrong with ANYTHING gold

BG

Sovereigns are 22ct gold.

_________________
Laird

If all else fails, use 6 inch nails

Totally worth it then - just need somewhere to sell them.

Be aware, you get royally robbed at shops that offer to buy "SCRAP or UNWANTED gold" - it's classed as SCRAP and thus has no legal value.

Not sure where you'd sell it, but image there must be a market that's not those robbing so and so's..

BF

I personally wouldn't without a lot of research into market trends, golds too high risk with the rate of return in my opinion.

I invested in an early 70's fender jazz a few years ago, it's increased in value by hundreds and hundreds. Factoring in inflation I'm making a bloody killing, and I (very very carefully) get to play with it!

If you want a casual investment, rare instruments and records are the way forward I reckon. You need to know where to look and know what to buy though.

Sovereigns weigh 7.98 grams (or 0.281486216 ounce) - with gold currently retailing at around £29 per gram (as of 18 Nov 2011) the sovereigns are worth approximately £231 each. If he paid more for them the he is of course LOSING money, notwithstanding the fact that the price of gold is fluctuating a lot recently - mostly upwards.

If gold continues to rise and he sells before it falls then he will make money. It's a risk, as are all financial transactions.

If the world goes tits-up and economies collapse, as is increasingly likely, then 'hard currency' like gold, silver (most metals in fact) will prove their worth.

_________________
This post may contain nuts

The Pikeys and Romanians round our way seem to be stockpiling copper and lead.

Of course, they're not paying for it - so they can't possibly lose!

I bought some Krugerrands a couple of years ago for about £720 each, they are worth about £1150 now. The rate of change in increase in value has now slowed down but gradually it is still going up with a few down paths too.