Today, Gold Krugerrands rank as one of the top bullion investments worldwide. However, the Gold Krugerrand was in serious political disfavor in the 1980s, and its demand fell into a deep depression thereafter. To understand how best to buy and sell gold Krugerrand coins, it is important to compare them to the top three alternative investments.
At the turn of the century, the Krugerrand world supply was substantial, and soft demand led to very attractive, near-zero buying price premiums over bullion. This changed as gold’s popularity as an investment surged, particularly during the 2008 apex of the Great Recession, which began in 2007. Read on to explore how Krugerrands, along with other gold coinage and bullion, has evolved through three distinct phases of the 21st century.
From 2000 to 2007, there was an abundant supply of gold bullion coins for investment, and premiums over bullion were low. This made it an ideal time to buy Krugerrands, which were priced nearly at the cost of bullion. For example, Monex’s year-end ASK prices for Krugerrands averaged just 0.6% over bullion between 2000 and 2007.
In comparison, the American Gold Eagle, another 22k (91.67%) gold coin, had a premium of 2.6%, with the lowest being 1.9% in 2006. The Canadian Gold Maple Leaf, the world’s first 24k gold coin, had an average premium of 2.2% during this period, with the lowest being 1.9% in 2005, 2006, and 2007. In hindsight, Krugerrands represented an advantageous buying opportunity early in this century, but then easy banking over many years set the stage for a change.
The 2007–2009 Great Recession and subsequent banking system meltdown breathed life into the demand for gold coins, including the pioneering South African Krugerrand. As inventories of Krugerrands were exhausted and demand grew, the price premium for Krugerrands jumped from the decade’s 0.6% average to 3% over bullion by the end of 2008.
At the same time, the American Gold Eagle’s premium increased from 2.6% to 4.8% over bullion, and the Canadian Maple Leaf rose from 2.2% to 3.9%. The crisis-driven demand led to higher premiums for all gold coins, with Krugerrands taking the biggest visible leap in purchasing cost.
From 2009 through 2023 year-ends, buying premiums reflected a new paradigm for the Gold Krugerrand at an average of 2.1% over bullion bars, with occasional fluctuations as low as 0.6% and high years nearing 2.8%. Compared to the American Gold Eagle, which had an average premium of 3.3% over bullion during the same period, Krugerrands continued to offer a more affordable acquisition price for a 22k gold coin.
While the 24k Canadian Maple Leaf remained popular, its premium averaged 2.0% post-crisis, slightly lower than the Krugerrand. This may reflect that Krugerrands and American Gold Eagles occupy a unique position in the market, having 22k (91.67%) gold fineness.
Interestingly, both the Krugerrand, the first-ever gold bullion coin, and the American Gold Eagle, introduced nine years later, are 22k (91.67%) gold purity coins, yet the other top gold coins are 24k pure. Similarly, their global recognition as gold bullion coinage is unsurpassed.
Although the American Gold Eagle’s popularity and demand have been healthy since its inception, Krugerrands have experienced monumental ups and downs. Synonymous with investment gold coinage, the Krugerrand represented 90% of the gold coin market in the 1980s, only to be tarnished by political issues surrounding apartheid. Following the resurgence of gold’s investment appeal in 2008, the Krugerrand regained its position as a top bullion coin, recognized for its African origins as the gold capital of the world.
* For a discussion on other comparisons, get in touch with your Monex Account Representative.
| 24k Bullion | Krugs | Diff | Eagles | Diff | Maple Leafs | Diff |
|---|---|---|---|---|---|---|
| 276.10 | 276.90 | 0.3% | 285.00 | 3.2% | 283.30 | 2.6% |
| 283.30 | 288.10 | 1.7% | 290.90 | 2.7% | 291.80 | 3.0% |
| 354.10 | 356.10 | 0.6% | 363.50 | 2.7% | 362.50 | 2.4% |
| 421.90 | 424.70 | 0.7% | 434.10 | 2.9% | 430.80 | 2.1% |
| 445.20 | 446.00 | 0.2% | 455.90 | 2.4% | 454.70 | 2.1% |
| 525.80 | 526.50 | 0.1% | 537.00 | 2.1% | 535.80 | 1.9% |
| 644.50 | 645.30 | 0.1% | 657.00 | 1.9% | 656.50 | 1.9% |
| 845.50 | 854.70 | 1.1% | 868.60 | 2.7% | 861.50 | 1.9% |
| 894.30 | 920.70 | 3.0% | 936.90 | 4.8% | 929.40 | 3.9% |
| 1,113.00 | 1,144.70 | 2.8% | 1,157.20 | 4.0% | 1,142.40 | 2.6% |
| 1,442.30 | 1,474.60 | 2.2% | 1,476.90 | 2.4% | 1,464.20 | 1.5% |
| 1,589.50 | 1,625.50 | 2.3% | 1,633.90 | 2.8% | 1,620.60 | 2.0% |
| 1,699.10 | 1,731.90 | 1.9% | 1,746.80 | 2.8% | 1,725.40 | 1.5% |
| 1,224.70 | 1,254.50 | 2.4% | 1,264.50 | 3.2% | 1,246.60 | 1.8% |
| 1,202.40 | 1,231.90 | 2.5% | 1,241.90 | 3.3% | 1,224.10 | 1.8% |
| 1,078.50 | 1,097.10 | 1.7% | 1,114.40 | 3.3% | 1,101.90 | 2.2% |
| 1,168.80 | 1,189.60 | 1.8% | 1,208.00 | 3.4% | 1,192.20 | 2.0% |
| 1,323.20 | 1,343.40 | 1.5% | 1,358.00 | 2.6% | 1,342.80 | 1.5% |
| 1,301.90 | 1,321.70 | 1.5% | 1,329.00 | 2.1% | 1,323.90 | 1.7% |
| 1,540.50 | 1,549.30 | 0.6% | 1,575.90 | 2.3% | 1,549.60 | 0.6% |
| 1,932.20 | 1,974.70 | 2.2% | 1,991.40 | 3.1% | 1,978.50 | 2.4% |
| 1,848.70 | 1,902.10 | 2.9% | 1,912.80 | 3.5% | 1,900.90 | 2.8% |
| 1,856.20 | 1,905.50 | 2.7% | 1,967.50 | 6.0% | 1,904.90 | 2.6% |
| 2,102.20 | 2,161.10 | 2.8% | 2,191.50 | 4.2% | 2,156.10 | 2.6% |
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