The Queen Elizabeth Platinum Jubilee will be celebrated with commemorative coins next month. Investors should however, treat these coins with caution.

The Platinum Jubilee for Queen Elizabeth is being celebrated next month with commemorative coins – but investors should treat them with caution. 

After the death of her father, King George VI on February 6, 1970, the Queen celebrated 70 years as Monarch. In June 2002, she was officially consecrated. 

Royal Mint is already promoting special coins in celebration of this historic event. A new 50-cent set will go into circulation next month. Limited edition Royal Anniversary gold sovereigns will also become available. 

Tribute: The new 50p will be put into circulation next month

Tribute: The new 50p will be put into circulation next month

While it’s understandable for many to want these coins to be Royal memorabilia to collect, investors who are looking to make a profit from coins should be cautious. 

Adam Ball, the marketing manager of coin dealer Chards says, “Modern collectables coins should not just be purchased to make money. They should also be owned by collectors. 

“There’s going to be much hype about the releases. Although they’re unlikely to appear in large numbers enough to draw major investment interest, there’s likely to be significant investor interest. 

An initial batch of Platinum Jubilee 50p ‘uncirculated’ coins was released earlier this month by Royal Mint at £7 each. Readily available, they are intrinsically worth no more than 50p so on paper you are already £6.50 out of pocket. 

But a mint condition, uncirculated specimen will be more valuable than a coin with a lot of scratches and dents. Ball states that limited-edition coins from the past can be used as a price guide. Examples like the Kew Gardens 50p coin are very sought-after and often worth more than their nominal price. 

A Kew Gardens coin, which was first released in 2009, features a photograph of a pagoda one side. Only 210,000 coins were minted to commemorate the Royal Botanic Garden’s 250th anniversary – and they now sell for up to £200. As 1.3million pieces of the Platinum Jubilee 50p coin are planned to become available, it is highly unlikely that they will go up in price. 

However, the design appeals to coin collectors as the queen’s head profile is no longer used. The image instead features a majestic picture of the Queen riding on horseback. On the ‘tail’ side of the 50p coin will be the number 70, shown in bold. 

If mistakes in production are made, a currency will rise in value. At the 2012 Olympic Games, for example, many 50p coins were issued. 

An incorrectly designed aquatic coin had lines that obscured the swimmer’s eyes. Only 600 were released before the mistake was noticed, but these coins now sell for up to £800. 

It is common to trade in coins which have been altered. You should therefore only deal with members of The British Numismatic Trade Association to buy coins. 

Ball says: ‘Although they might not make you rich, limited edition 50p coins are a great place to start as a collector. Once you’re hooked, however, it is possible to want more valuable coins. 

Commemoration: Royal anniversary gold sovereigns will also be released

Commemoration: Gold sovereigns in commemoration of the Royal Anniversaries will also be available

Separate from standard coins issued for everyday use by the Royal Mint are ‘proof’ coins – newly minted pieces on polished dies. These coins, also known as ‘first struck’ are of the highest quality collectors can locate. 

A run of 5,000 Royal Mint Platinum Jubilee 50p sterling silver proofs sold out immediately earlier this month even though they cost £57.50 each. They now change hands for up to £140. 

The 22-carat sovereign of solid gold in 22 carats might appeal to those who have more money. Limited to just 1,200 coins, the 7.98-gram piece is to be released on February 6 by Royal Mint at £675. 

BullionVault director Adrian Ash says that such coins do not make the most sense in terms of their gold price. 

According to him, despite the fact that it might be packaged in fancy packaging and a certificate certifying authenticity, this jubilee coins intrinsic value is equal to any sovereign coin. 

The modern gold sovereign has a face value of £1 and currently changes hands for about £340. You pay nearly twice as much for a jubilee currency intrinsically equal to the same. 

All gold sovereigns are considered legal tender and therefore exempted from capital gains taxes. There is no VAT on investment-grade gold. 

Ash said, “Don’t purchase a gold sovereign for a Royal event unless you are looking for a commemorative item.” 

The gold bullion contained within the coin has the greatest value. If the primary reason you are buying precious metals, then consider other options such as purchasing a bar of gold.