As Gold Hits Record Highs, Perth Mint Finds Success in Smaller Sized Coins
As the price of gold continues to climb, the cost of purchasing a one ounce gold bullion coin is approaching $1,600. In order to provide the opportunity to own gold within a more reasonable price range, innovative mints have begun offering smaller sized gold coins. In April 2010, the Perth Mint of Australia introduced a half gram 99.99% pure gold coin named the Mini Roo.
Struck with a fineness of .9999, each Mini Roo contains 0.016 troy ounces of gold. The coins have a diameter of 11.60 mm and thickness of 0.70 mm. By comparison, the one ounce Australian Gold Kangaroo has a diameter of 32.60 mm and thickness of 2.80 mm. The half gram Mini Roo and 1 oz. Gold Kangaroo are shown side by side in the image below.
According to the Perth Mint’s website, the Mini Roo is currently priced at $54.18. A major precious metals dealer’s website currently quotes the price of a single one ounce 2011 Gold Kangaroo at $1,668.23.
Alexandra Lucchesi of the Perth Mint Public Relations Department was kind enough to some insights on the objectives and sales levels of the diminutive gold coins.
Gold and Silver Blog: Can you provide us with any indication of the sales levels of the Mini Roo half gram gold coin and how it compares to the sale of one ounce coins?
Alexandra: To compare sales of the Mini Roo and 1oz gold bullion coins would not be a valid comparison. The issues vary considerably in weight and price, and therefore, do not encompass the interest of the same individual and institutional investors. Furthermore, the Mini Roo is targeted more toward collectors and gift buyers, whereas the gold coins of the Australian Kangaroo and Lunar series are directed more toward investors.
Gold and Silver Blog: Has the half gram gold coin met sales expectations and have sales increased as the price of gold has climbed?
Alexandra: The release of the Mini Roo has met our objectives at both wholesale and retail levels, with sales exceeding more than 15,000 2010-dated coins to date since being released in April last year. With the 2011 coin only just released a fortnight ago [April 5, 2011], we can not yet estimate sales for the remainder of the year, although, with periodic prompted promotion, we are also anticipating favourable sales of this issue.
Gold and Silver Blog: Will the Mini Roo become a regular annual issue?
Alex: A Mini Roo was first introduced to the market in April 2010. Complementing the world renowned Australian Kangaroo gold bullion coin series, the Mini Roo is expected to be released each year and will continue to portray the identical design as, or a simplified version of, the iconic Australian Kangaroo annual issues.
Gold and Silver Blog: I would suspect that the much lower cost of the Mini Roo allows greater participation by investors and collectors as well as placing the Mini Roo within the affordable gift category. Was the higher price of gold the determining factor in deciding to produce the half gram coin? Have the offerings of smaller sized gold coins resulted in an increased number of new customers?
Alexandra: That is correct. The Perth Mint introduced the Mini Roo to encourage a broader audience to start investing in, or collecting, precious metal coin products. In addition, the smaller coin was perfect to capture the interest of those who, traditionally, were unable to afford the classic Australian Kangaroo bullion coin sizes. The timing for the initiative was also enhanced by the rising price of gold. The lower price point of the button-sized Mini Roo does give individual precious metal investors, coin collectors and gift buyers the opportunity to purchase a pure gold coin at an affordable price featuring a similar design as its traditional counterpart.