Investing in gold coins through gold coin dealers is a way to invest in small amounts of gold. As you will see later, some rare coins can end up being a sizable investment. Dealers often buy and sell all kinds of gold coins. Your first lesson in gold coin investing is that there are two main types of coins: Bullion Coins and Numismatic (Collectors') Coins. When you are buying or selling a coin, you need to know the difference between these two types of gold coins.
Buying tips
New investors can get confused, mainly because they don't understand the difference between and numismatic coin and an bullion coin, and also because they may not understand the value of each type of coin. Let's take a closer look at the two types of coins.
For a simple gold play: modern gold bullion coins
Gold bullion coins are the most popular coins, probably because they are the simplest to value and buy, and also because there are so many more of them (they are mass produced.) These coins are generally sold just above the spot price of gold (usually to account for minting cost and dealer commission.) Also, these coins are minted with a lower quality finish called a "bullion finish" which pretty much guarantees it will not turn into a collectors' item. Friendly gold coin dealers can show you different types of bullion coins, and pictures of them are readily available online.
For the collector: Rare, scarce or "numismatic" coins
These coins can be worth far more than their intrinsic value (the value of the gold contained in the coin.) An example would be a rare one ounce coin minted in 1861 which sold at auction in 2008 for $2.5 milllion! It was very rare indeed