Price question: 1/20 oz coin vs 1 oz coin

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mazztech

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I'm looking to buy some more gold for my collection and would like to buy some smaller weight pieces. In particular I was looking at the Canadian Maples and when I compared the price I would be paying much more for 1 oz of gold buying smaller coins then larger coins.

At current spot price Apmex is selling 1 oz coins at about 1350 USD.
http://www.apmex.com/product/9/1-oz-gold-canadian-maple-leaf-random-year

Their 1/20 oz coins (which I should need 20 of to make one oz) is ~90 USD per 1/20 oz which for 1 oz comes to a total of 1800.

Since gold is gold shouldn't they be the same price or am I missing something or doing something silly?

My main purpose for gold is as a backup if our paper currency fails. I feel it would be easier to use smaller denominations of gold vs larger ones.
 
You are missing the fact that whether anyone sells 1oz or 1/20oz, the overhead and related costs are roughly the SAME PER COIN. Therefore, the smaller the coin, the higher the premium percentage.

To look at it in a different way, if you had to drive 50 miles to a job site, would you accept the same RATE PER HOUR for a 1 hour job as you would for an 8 hour job?
 
Thanks for your reply. Then why would I be able to buy 24 Karot gold jewelry at spot price? Wouldn't it take a jeweler more time to create a necklace then a machine to press some gold into a coin?
 
Premiums are always higher on smaller weight units. It's the same with premiums on silver bars too. 100ozt bars have lower premiums than 1ozt ingots.
 
Thanks for your reply. Then why would I be able to buy 24 Karot gold jewelry at spot price? Wouldn't it take a jeweler more time to create a necklace then a machine to press some gold into a coin?

Jewelry has a very high mark up regardless of gold content. In the U.S. the normal mark up is 70%!
 
...

Today I paid $145 each for (2 pcs) 1/10th oz Gold Eagles, or roughly 4.7% over spot at my "other" LCS (better prices but further away).

I priced out his 1 oz Gold Eagles, he wanted $1445, so the 1/10ths were almost surely as good as I will get (low premium).

***

My "main" LCS owner told me there is continuing talk about the US Mint stopping the 1/10ths (apparently the dies wear just as fast for the 1/10 as much as the 1 oz). Anyone here have any knowledge or insight on this?
 
I haven't heard anything about that, but if they run out of gold, they will have to halt production (again).
 
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