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 Gold
Sovereigns
Are Gold Sovereigns the best Gold Coins to buy?
A
Gold Sovereign is a
gold coin first issued in 1489 for Henry VII of England and still in
production as of 2010. While the coin typically had a nominal value
of one pound sterling or 20 shillings, the Sovereign was primarily
an official piece of bullion with no mark of value on the
coin itself.
The name "Sovereign"
comes from the majestic and impressive size and portraiture of the
coin, the earliest of which showed the king facing, seated on a
throne, while the reverse shows the Royal coat of arms on a shield
surrounded by a Tudor double rose.
Learn
about: Today's Gold & Silver Prices
The History of the
Sovereign
Original Sovereigns were 23 carat (96%) gold and weighed 240 grains
or one-half of a troy ounce (15.6
 grams). Henry VIII reduced the
purity to 22 carats (92%), which eventually became and remains the
gold coin standard (so-called Crown Gold) in both England and the
U.S.; the weight of the Sovereign was repeatedly lowered until when
it was revived after the Great Recoinage Act became law in 1816, the
gold content was fixed at the present 113 grains (7.322 g),
equivalent to 0.2354 Troy ounces.
What was the Price of Gold in the Past?
Gold &
Historic Gold Prices
In addition to the
Sovereign, the Royal Mint also struck 10
Shilling
coins or the Half Sovereign.
There is also a
£2 coin (or Double Sovereigns) and
more rarely £5 coins
(quintuple Sovereigns). Only the Sovereign and the half Sovereign
were commonly struck for circulation.
New
1/4 Sovereigns have been made by the
Royal Mint in 2009/10.
Gold & Half Sovereigns
Sovereigns were discontinued after 1604, being replaced by Unites,
and later by Laurels, and then guineas. Production of Sovereigns
restarted in 1817, their reverse design being a portrayal of Saint
George killing a dragon, engraved by
Benedetto Pistrucci. This same
design is still in use on British gold Sovereigns, although other
reverse designs have also been used during the reigns of William IV,
Victoria, George IV, and Elizabeth II.
In Victorian times it was the practice of the Bank of England to
remove worn Sovereigns and half Sovereigns from circulation and have
them recoined.
Consequently, although a billion Sovereigns have been
minted in total, that figure includes gold that has been coined and recoined a number of times. In addition, when coins were sent to
places such as the United States for international payments between
governments, coins were frequently melted down into gold bars
because of the Federal regulations then in force. When gold coins
were finally withdrawn from circulation in 1933 in the US, many
thousands of British gold Sovereigns were consigned to the melting
pot in this way.
It is estimated that in circulation, a Sovereign could have a
lifespan of up to 15 years before it fell below the "least current
weight", that is, the minimum amount of gold below which it ceased
to be legal tender.
It was actually the
half-Sovereign that had the most circulation in Victorian England.
Many Sovereigns languished in bank vaults for most of their lives.
It is estimated that only 1% of all gold Sovereigns that have ever
been minted are still in collectable condition.
Gold &
Price of Gold
 In 1891 a proclamation
was made that members of the general public could hand in any gold
coins that were underweight and have them replaced by full weight
coins.
Any gold coin struck before 1837 also ceased to be legal
tender. This recycled gold was subsequently re-minted into 13,680,486
half Sovereigns in 1892 and 10,846,741 Sovereigns in 1900. (Both
figures for the London branch of the
Royal Mint).
Sovereign obverse (heads) dies were also used in the nineteenth
century to create farthings once they had become worn. (An obverse
die could typically produce 100,000 coins.)
Sovereigns were
produced in large quantities until World War I, at which time the UK
came off the Gold Standard. From then until 1932, Sovereigns were
produced only at branch mints at Melbourne, Sydney,
Perth, Bombay,
Ottawa, and Pretoria (except for some in 1925 produced in
London as
part of Winston Churchill's ill-fated attempt to return the UK to
the gold standard or, more
correctly, to the gold exchange standard). The last regular issue was in 1932 (at
Pretoria).
Gold & The Gold Standard
Production resumed in 1957, ostensibly to prevent the coin being
counterfeited in Syria and Italy. Subsequent publication of treasury
papers appear to indicate that Sovereigns were widely used in
pursuance of British foreign policy in the Middle East, and it was
felt that the coin could not be allowed to fall into disrepute, as
many individuals were receiving payments in the form of Sovereigns
for services rendered to the British government.
 Sovereigns were produced most years as
bullion until 1982. From
there to 1999, proof coinage only versions were produced, but since
2000, bullion Sovereigns have been minted. Modern Sovereigns are
minted at the Royal Mint in Pontyclun, Mid-Glamorgan, Wales.
The coins are produced
in the precious metal unit which is sealed off from the rest of the
Royal Mint, the Mint itself being protected by Ministry of Defence police.
Employees are not allowed to use any coins within the Mint; plastic
tokens replacing coins of the realm are used in the staff canteen.
Mintage figures for the latest British coin production are given
below. Please note: these are the actual number of coins issued, not
the official issue limits often advertised. In addition, the Mint
will strike extra coins for the purposes of quality control, i.e.
samples of coins are submitted for the
Trial of the Pyx which
involves their destruction. Thus, an issue limit figure never fully
reveals the true number actually created. Furthermore, the date on a
bullion coin refers to the year the die was made, not necessarily
the year in which it was struck. It is not unknown for the Mint to
strike gold Sovereigns with the date of the previous (or even older)
years, e.g. bullion Sovereigns struck during the reign of George VI
were all dated 1925 and featured the head of George V.
Counterfeiting
To modern eyes, the gold Sovereign appears quite a small coin,
however, it must be remembered that a £1 in 1895 was the equivalent
in purchasing power of about £160 as of 2010. Gold is also a highly dense
metal,
so a small coin like a Sovereign can contain nearly a quarter
of an ounce of metal. Another reason for limiting the production of
double Sovereigns (£2) and quintuple Sovereigns (£5) was the
relative ease of removing gold from these larger coins - chemically,
by filing, or using other techniques; for example, the drilling of
small holes into the coin followed by hammering to conceal the
holes.
Composition
Sovereigns usually have a higher premium to the price of gold than
some other coins, like the Krugerrand. This is due to a number of
factors: the higher unit cost of the Sovereign (at under one-quarter
of an ounce); the higher demand for the Sovereign from numismatists
(compared to the Krugerrand which is not sought-after by collectors);
and the higher costs of identifying and stocking a numismatic coin.
For other ways to invest in gold, see gold as an
investment.
Current Sovereigns (2000 onwards) are struck in the same 22 carat
(92%) gold alloy as the first modern Sovereigns of 1817, which is
also known as Crown Gold, which contains 11/12 gold and 1/12 copper.
The only time there has
been a deviation from this composition was in the production of
early Australian Sovereigns, which used
silver as part of the alloy
and in London Sovereigns dated 1887, when an additional 1.25% silver
was added in order to make the blanks softer for new Joseph Boehm
effigy of Queen Victoria.
Silver & Historic Silver Prices
Consequently, 1887
London Mint Sovereigns are more yellow in appearance than other
London produced Sovereigns. This additional
silver affected the
amount of copper in the coin, not, of course, its gold content.
(Nineteenth century techniques of refining were not as advanced as
today, and nineteenth century Sovereigns became more accurate in
terms of their gold weight as silver — which is often naturally
combined with gold — was removed as an impurity from the "pure" gold
used. Such minor inconsistencies would not affect either their
numismatic or bullion value).
Care should be taken
when purchasing the new bullion Sovereigns (2000 onwards) featuring
Ian Rank Broadley's portrayal of the Queen. It is not uncommon to
see a weak striking on the obverse side which carries the Queen's
effigy. One should look out for lack of detail in the depiction of
the Queen's hair and ear. Such weak strikings appear to be
relatively common.
 The Royal Mint created a new die for the 2007 and 2008
bullion
issues. The 2007 reverse die was based on a handmade original
created by Benedetto Pistrucci which was reworked to make new master tools.
The Royal Mint spent time choosing what it believed was the most pertinent
die (from the reign of George III) which they believed contained the
most detail. Using a combination of hand engraving skills and
digital technology, the Mint attempted to restore detail that had
been lost over the years.
Consequently, the 2007
Sovereigns have significant differences in
their reverse design from the other coins produced from 2000 to
2006. In the 2007 version the shape of the horse's tail has changed,
as has the left hand side of the edge of the ground. The initials B.P. (for
Benedetto Pistrucci) are also a lot smaller than on
previous versions. It is also possible that the folds in St.
George's cloak have also been rearranged. The reverse now most
closely resembles the version of St. George and the Dragon which
appeared on the 1818 silver crowns of George III.
The 2008 gold Sovereigns also appear to have a reworked reverse
design although, surprisingly, this is not commented upon in the
Mint's marketing literature. When comparing a 2007 and 2008
specimen, it is obvious that features such as the horse's tail, the
muscles of the horse and St. George's streamer have been altered.
The design appears almost rudimentary when compared to the more
subtle versions we have seen over the years. Although it has yet to
be confirmed, it can be speculated that the
Mint has once again gone
to an earlier version of the design by Pistrucci and used this.
Whether this is a definite policy of the Mint to revisit historic
dies remains to be seen.
How to:
Invest in Gold
With regards the weak design of the Queen's head, this is again a
feature of the 2008 version, although not as pronounced as with
earlier versions. A possible explanation may lie in the design of
the Queen's effigy by Ian Rank Broadley. As this is a relatively
large design, it may present problems in circulation minting in the
same way as the infamous "ghost" pennies of George V.
If one side of a design
takes up more metal than the other side of a coin, the flow of metal
which takes place at striking may make one side more indistinct.
This may explain why mass produced bullion versions sometimes have
highly indistinct features on the Queen's face.
Sovereigns were produced as follows:
London: 1817–1917, 1925, 1957 onwards
Melbourne: 1872–1931
Sydney: 1855–1926
Perth: 1899–1931, 2010 -
See the
NEW DESIGN!
Bombay: 1918 only
Ottawa: 1908–1919
Pretoria: 1923–1932
 Half Sovereigns, two pound double Sovereigns, and five pound
quintuple Sovereigns coins were also produced.
Silver
Also there are new pages on
Silver Coins and
Sterling Silver
and Historic Silver Prices
and the Silver Standard.
US
Silver Eagle
Canada
Silver Maple Leaf
To learn more about gold and silver investing,
please go to:
http://www.how-to-invest.co.uk/index.htm.
PLEASE SEEK
PROFESSIONAL ADVICE BEFORE YOU BUY OR SELL GOLD, SILVER & COINS.
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