One of the most famous gold coin series around the world is the British Gold Sovereign. The first coins in this series were minted in 1489 by King Henry VII of England. They had a nominal value of one pound sterling (20 shillings), but their primary use was as official bullion, so there is no marked face value on the coins. This characteristic makes the British Gold Sovereign a much sought-after coin by both investors and collectors alike.
The first gold sovereigns were 23 carat gold (96% percent pure) and contained one half troy ounce, of gold. Over time, the UK adjusted the gold content in the coin to find the proper combination that would preserve the Sovereign’s exquisite beauty and intricate design. The gold content was finally fixed at 0.2354 troy ounces of gold in each coin, where it remained. This new standard made the coin far more durable and long-lasting throughout circulation.
In 1817, King George III reinstituted the Sovereign in Britain’s currency. That same century, the Master of the Mint commissioned Benedetto Pistrucci to create a new image for the coin’s reverse. Pistrucci designed a new engraving of St. George and the dragon, which is still used on the coin today. The coin has featured only four monarchs:
- Edward VII ruled from 1901 to 1910. Known as a peacemaker, Edward VII forged alliances with several European nations. Both circulated and uncirculated Edward VII Sovereigns are available.
- George V succeeded Edward VII and ruled until 1936. The first ruler of the House of Windsor, George V guided the nation through World War I. George V Sovereigns can be found both circulated and uncirculated.
- Victoria, who ruled from 1837 until 1901, promoted expansion of the empire and industrial development. Sovereigns were widely used as circulation during Victoria’s reign, but uncirculated samples can still be found.
- Elizabeth II, Britain’s current reigning monarch, celebrated her 50th year as queen in 2002. Sovereigns featuring Queen Elizabeth II are available only in brilliant uncirculated condition.
Gold Sovereigns were produced in large numbers until World War I, when the British pound was removed from the gold standard. Until 1932, sovereigns were produced only at branch mints around the British Commonwealth, specifically in Melbourne, Sydney, Perth, Bombay, Ottawa, and Pretoria.
Modern versions of Sovereigns have been produced over time, but the pre 1933 gold coins have been in strong demand by gold investors and have a very strong market today. Mainly due to the additional privacy and tax benefits gold coins produced carry because they are classified as a "collectible" by the IRS.
Historically, British Gold Sovereigns were regularly removed from circulation by the Royal Mint and their gold content reminted into new coins. There were also buybacks of coins that had lost some of their weight in circulation, which were exchanged for full weight sovereigns. Because of this history of reminting, old British gold coins often have extraordinary numismatic value because of their rarity. In fact, it's estimated that only about 1% of coins that were produced are still in mint condition.
Sovereigns usually have the same premium of regular fractional sized bullion coins, including the Krugerrands. It is far more labor-intensive and time-consuming to mint smaller sized gold bullion coins (such as the Maple Leaf, Eagle, and Krugerrand) than the one ounce sized bullion coins. Most production centers around the full one-ounce coins, and smaller coins require that the equipment be retooled, and quality inspections cost time and money. The cost of manufacturing ten 1/10th-ounce coins far exceeds the cost of minting a single one-ounce coin.
Because the British Sovereign is no longer in production, it is a highly in-demand coin for both investors and collectors alike. The British Sovereign also offers far more privacy and tax advantages than many other investments, making this an excellent gold coin to purchase when looking for fractional sizes gold coins.
