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For metals investors looking to expand their investment portfolio, palladium coins can be an excellent choice. Palladium significantly outperformed gold and silver from 2016 – 2017. Whether or not palladium can continue to perform better isn’t the main point. The palladium markets offer different fundamental drivers and provide an opportunity for bullion investors to diversify – that is what makes the metal most interesting.
Palladium is an extraordinarily scarce metal. It is 15 times more rare than platinum and 30 times more rare than gold. Roughly 80% of the world production comes from Russia and South Africa. These nations are both subject to geopolitical turmoil which can impact supply.
Palladium coins tend to be minted in small batches. While popularity is growing, the number of coins traded is small relative to gold and silver, and the variety of coins available is limited. If demand should rise sharply, investors can expect premiums to rise even faster.
In this article, we will explain why investing in palladium coins is growing in popularity. We will go over some of the best known types of these coins, and how to purchase and trade them.
A small handful of sovereign mints have produced coins using the silvery-white member of the platinum group of metals known as palladium. Coins are, by definition, made by an official government mint and generally carry status as “legal tender”. The government guarantees them for weight and purity – a feature which many metal investors appreciate. Palladium bars, which are typically made by private mints and refiners, do not have the government guarantee. They are, instead, backed by the companies who produce them.
Sierra Leone was the first country to issue these coins in the late 1960s, after which more countries began issuing their own. Today, the most popular coins come from countries such as Canada, China, Russia, and the United States.
They batches of bullion coins produced each year are among the smallest available to investors and collectors. The US Mint produced just 15,000 palladium American Eagles in 2017. It was the first time the Mint had issued a coin made of this metal, and the entire issuance sold out almost immediately.
They can be included in your self-directed individual retirement account (IRA). Keep in mind, however, there is a requirement for purity. Palladium coins need to be at least .9995 pure to be held in an IRA.
A handful of national mints offer palladium coins. These are some of the most widely traded globally, though the Chinese Panda and Russian Ballerina are not common in the North American market.
The Chinese government minted their first Palladium Panda coin in 1989. They are issued by the People’s Bank of China.
The Panda is beloved in China for its design. The obverse features one of the most famous Chinese landmarks – the Temple of Heaven in Beijing. The reverse design changes every year, but always features the panda, an endangered species that has become a symbol of China.
The value of these coins will vary depending on the year they were minted. Since the 1989 coins had a very limited mintage, today they are very hard to find. Some later editions can be found a bit more easily.
The US Mint’s first official palladium coin was released in 2017, so they are the most recent addition to the American Eagle series of coins. Each coin contains one troy ounce of .9995 purity palladium and is denominated with $25.
The obverse was adapted from Adolph A. Weinman’s famous design of the “Mercury” dime. Interestingly, the reference to “Mercury” is a misnomer. The Roman god is not what the artist intended to show. The image is actually of ‘Winged Liberty,’ a portrait of Lady Liberty wearing a winged Phrygian cap. Alongside her are inscriptions that read ‘In God We Trust,’ ‘Liberty,’ and the date of issue.
The reverse features an image of a powerful bald eagle holding a laurel branch, with the inscriptions ‘United States of America,’ ‘1 oz Pd .9995 fine,’ and ‘E Pluribus Unum.’
The Royal Canadian Mint began issuing a palladium version of its famous Maple Leaf in November 2005. When the Canadian government introduced them, they were the first legal-tender coins intended for the bullion market. More Canadian Maple Leafs have been minted than any other coin of the type.
The obverse of these coins features Queen Elizabeth II. The portrait was created by Susanna Blunt, and it has been on the front of every variety of Maple Leaf since the coin series began. Each is denominated with $50 CAN.
The reverse is stamped with the iconic Canadian maple leaf, along with the weight and purity – 1-oz, .9995 pure.
Like the American Eagle, these coins can be added to a precious metals IRA, which is another reason to invest in them.
Because of their historical and cultural significance, the Palladium Ballerinas are some of the most sought-after coins of their type. Since 1989, Russia has looked at the production of palladium coins as a way of expressing pride in Russian culture and natural resources.
There were two versions of these coins minted – the 10-ruble and the 25-ruble ballerina coins. The front of both versions depicts a Bolshoi ballerina dancing to Swan Lake, a ballet which has special significance in Russian culture.
The back of the coin features the symbol of the Soviet Union, even though the production continued after its collapse. The last mintage year of these coins is 1995, which is a major factor in their relative scarcity.
The Chinese government minted their first palladium Panda coin in 1989. They are minted by the People’s Bank of China. China’s central bank is one of the few tasked with minting the nation’s coinage.
The Panda is beloved for its design. The obverse features one of the most famous Chinese landmarks – the Temple of Heaven in Beijing.
The reverse design changes every year, but always features the panda, an endangered species that has become a symbol of China.
The value of these coins will vary depending on the year they were minted. The coin has only been issued twice – in 1989 and again in 2004. Today they are very hard to find.
The choices are more limited than with other precious metals, but these days palladium coins are readily available. The Maple Leaf, in particular, is consistently available in dealer inventories.
Because the palladium market is relatively small, it may be advisable to spread larger purchase and sale transactions over time. Investors taking a position larger than $100,000 could exhaust the available stocks.
As with any investment in precious metals, it is a very good idea to stay away from collectible, or numismatic, coins unless you are experienced in those markets. For most people, the best investment will be in palladium coins which are primarily valued based on the metal content, not rarity.
Palladium coins are easier than ever to add your stack of precious metals. You’ll gain exposure to a market with explosive potential because palladium is both useful in industry and extraordinarily scarce.