Why the Krugerrand is a traditional keepsake
as well as the perfect gift that keeps on giving
– a gift that brings good luck and the perfect choice
to celebrate that new arrival in the family
or an investment gift for a special grandchild ……
If you are looking for a gift to welcome a new addition, you can’t go wrong with the perfect gift that keeps on giving, that traditional keepsake – the Krugerrand. It is quite coincidental that we should be publishing this article at this time – days after the new royal prince made his arrival into this world!
People have been giving gifts to newborns for centuries. The traditional choice was a silver coin, as an object of good luck. During the Victorian period, people began to give silver trinkets as christening gifts and the tradition still continues to this day. When the silver sixpence was introduced in 1551, people were soon claiming that it had lucky qualities. The Krugerrand could be construed as a gift that brings good luck and is the perfect gift to celebrate that special new arrival.
Finding that perfect gift for a special grandchild can be a challenge, however investing in a worthwhile gift like a Krugerrand could help you reap the benefits in the long term.
Krugerrands are the easiest way to own gold, which is the most widely known and actively traded gold bullion in the world.
“Gold has generally held its status as an investment haven in times of global uncertainty, disparate economic growth across countries and particularly when geopolitics takes centre stage as they have done in recent years. For some investors gold is a sentimental purchase, while for those who are generally sceptical of financial markets, Krugerrands provide a sense of comfort about the safety of their investment,” says Aneesa Razack, CEO of FNB Share Investing.
Krugerrands are the ideal gift in more than one sense:
- Krugerrands are linked to the international value of gold, which means that the investment is protected from local currency volatility and devaluation and therefore a true global investment you can rely on.
- Gold is considered a safe haven because of its properties as both a hedge against inflation, and its pricing in dollars – the reserve currency globally.
- Krugerrands have proven to be a valuable investment choice as the value of 1 ounce of a Krugerrand has increased by more than 870% between January 2000 and January 2018 – outperforming all other asset classes, while the price of gold has increased by roughly 370% over the same period.
- Krugerrands are also VAT zero rated and attract no trading fees, ultimately lowering transaction costs. There are, however, custody fees of 0.86% per year based on the value of your investment holding in Krugerrands and a monthly account fee, just like most banking products.
In February last year Rand Refinery Ltd recorded the highest output of Krugerrand coins in 23 years.
“The demand for gold has been increasing, with developing economies accounting for two thirds of the growth in demand, led by China and India. Gold mine supply is expected to peak in the near future. This may well lead to an increase in gold prices, a view that is supported by a few big global players like Goldman Sachs who recently revised their gold price forecasts upwards,” explains Razack.
Customers can buy different size coins to suit even the youngest in the family from as little as 1/10th of an ounce at the prevailing price with the choice to take possession of the coin or FNB will store it safely at Rand Refinery.
FNB’s digital platforms have made it easier for customers to track and buy Krugerrands and other investments. “Our investment in the digital platforms ensures that customers are well-equipped to manage their banking at any given point of time. Invest in that Krugerrand today. It will benefit you and your family in the future,” concludes Razack.
How one can purchase a Krugerrand:
- Log onto www.fnb.co.za
- Click on the share + Gold Tab
- Click on My Portfolio tab on the left hand side of the screen
- Click Krugerrands under Buy heading
- Select the account
- The system will provide you with estimated quote of the amount of coins you want to buy based on the funds in the account
- Click on Buy on the type of coins you want to buy
- Enter the amount of coins you want to buy
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