A
Krugerrand is a South African gold coin, first minted in 1967
in order to help to market South African gold. The coins have legal
tender status in South Africa but are not actually intended to be
used as currency, which is a reason why it is regarded as being one
of the world's medal-coins.
The Krugerrand was the first bullion coin to be tenderable at the
market value of its face gold content; by contrast, earlier gold coins
such as the gold sovereign had a tender value in currency engraved
on their face, which could be completely divorced from their market
value. The Krugerrand was the first gold coin to contain precisely
one ounce of fine gold, and was intended from the moment of creation
to provide a vehicle for the private ownership of gold. By bestowing
legal tender status upon the coin, Krugerrands could be owned by citizens
of the United States, which at that time prohibited private ownership
of bullion but allowed ownership of foreign coins. However, due to
the policy of apartheid in South Africa, the Krugerrand was declared
illegal to import in many Western countries during the 1970s and 1980s
until that system was lifted between 1990 and 1994.
Originally, it was sold at a significant premium of five percent over
the base gold value, and only one size of coin was made, containing
one troy ounce (31.1035 g) of gold. Today Krugerrands are offered
in a variety of sizes, at attractive premiums of no more than one
percent above the market price of gold.
Since the Krugerrand is minted from gold alloy that is 91.67 percent
pure (22 karats), the actual weight of a "one ounce" coin
is 1.0909 ounces (33.93 g). The remainder of the coin's mass is made
up of copper (2.826 grams), giving the Krugerrand a more orange appearance
than silver-alloyed gold coins. Alloys are used to make gold coins
harder and more durable, so they can resist scratches and dents during
handling. In 1980, three other sizes were introduced, offering a half,
quarter, and tenth ounce weights. In total, 54.5 million coins have
been sold.
Krugerrands: Their gold content is exactly one troy ounce.
Krugerrands
are a popular way to invest in gold because they have low premiums
over spot pricing.
The Krugerrand gets its name from the fact that the obverse shows
the face of Paul Kruger, a prominent Boer resistance leader against
the British and eventually the fifth, and last president of the old
South African Republic holding that office for four terms. The reverse
depicts a springbok antelope, one of the national symbols of South
Africa that was designed by Coert Steynberg and used on the reverse
of the earlier 5 shilling South African coinage for King George VI
and Queen Elizabeth II. The name "South Africa" and the
gold content are inscribed in both Afrikaans and English.
The success of the Krugerrand led to many other gold-producing nations
minting their own bullion coins, including the Canadian Gold Maple
Leaf in 1979, the Australian Nugget in 1981, and the American Gold
Eagle in 1986.
Courtesy
of: www.wikipedia.org