Investing in gold has never been easier thanks to the internet. Thousands of gold coin collectors and investors have begun buying their gold on eBay. Many buyers – particularly those new to eBay – wonder whether it’s safe to bid on gold coins here. As long as you do your homework and are careful which auctions you bid on, eBay can be a good place to add to your gold coin investment.
The first thing to remember about bidding on eBay is that you’re not actually purchasing the gold “from” eBay. Instead, you’re buying from an individual seller. They might be an investor parting out their collection. They could be an established precious metal dealer located in another state. They may be someone who’s come across a gold coin and put it up for sale even though they don’t know a lot about it. How can you be sure you’re buying from someone reputable?
The key is to check the seller’s feedback rating. This is your opportunity to judge the seller’s reputation. Reputation is just as important when buying online as it is when selecting a real-world coin dealer. When buying expensive items such as gold coins, rounds, and bars, it is best to stick with a seller who specializes in gold bullion, and who has thousands of feedback ratings from previous buyers.
Ebay is a particularly good place for small-time investors purchasing fractional coins. Such coins are difficult to find through traditional precious metal dealers, many of whom would rather sell in larger quantities. If you want to make a small purchase of gold – say, a single tenth-ounce coin, eBay can be an effective solution. Meanwhile, many buyers are wary of sending thousands of dollars to an eBay seller, so it’s a less popular place to buy larger gold coins and bullion.
Don’t forget to check out the return policy. Not all eBay sellers offer one, and you don’t want to be stuck with a coin that is scratched, damaged, or worse – counterfeit. Does the seller offer returns if the coin is not as advertised? Only purchase from online dealers who offer such as policy.
Take a close look at the photos. Be sure you understand whether the image is a stock photo or a photograph of the actual item being sold. However, don’t rely too much on the photos, as they can be doctored or carefully taken to present the coin in the best light possible.
Some bidders are willing to take a chance if the photos are blurry – particularly if the seller has a good return policy – while others prefer to see exactly what they’re buying. Carefully read all of the details in the description. If you still have questions or aren’t 100% sure what you’re buying, ask the seller before placing your bid.
Most eBay auctions run for about a week. If you plan to place a bid, don’t place it too early. This is especially the case with gold, where the spot price can change dramatically in the course of just a few days. Once you’ve entered your bid, you cannot retract it. If the spot price of gold falls between the time of your bid and the time the auction ends, you could be stuck paying too much. Instead, wait until the final hours of the auction to place your bid.
Before you bid, do your homework to determine the spot price of gold and the current market value of the coin. As long as you proceed with caution, you might find the chance to add gold bullion to your collection at less than spot.