When it comes to purchasing gold bullion, investors are often faced with the option of purchasing sovereign or private bullion. Sovereign bullion is minted by a private company and is not backed by any government. Private bullion is minted by a private company and is not backed by any government. The issuing government guarantees the legal tender status of sovereign bullion coins and bars. This guarantee increases liquidity, but it comes at a cost in the form of seigniorage fees and serial numbers, which increase the bullion's collectability and, as a result, its price through demand. Since private bullion does not have these value-added costs, it is almost always less expensive to purchase. Some buyers prefer bullion backed by a major government because of the stability and peace of mind it provides. Others, conscious of international danger and historical precedent (e.g., the Gold Reserve Act of 1934), prefer the polar opposite. At the end of the day, each investor must determine if sovereign or private bullion is the best fit for their investment philosophy and strategy.