Renewed Western investment in gold via ETFs has been a key factor in the yellow metals success in 2016. In fact, it has represented a sea change for bullion prices. But another supportive trend is ongoing and shows no signs of stopping: Central banks the world over continue to gobble up gold.

And why wouldnt they? With central banks imposing zero and even negative interest rates, thus sparking a race to the bottom in the value of currencies, gold represents a life preserver for nations worried about their foreign-exchange reserves.

Banks buy up almost 600 tons: Central banks have been net buyers of gold for eight years, with Russia, China, and Kazakhstan among the biggest hoarders, Bloomberg recently reported, citing data from the International Monetary Fund that showed that 590 metric tons of metal were purchased in 2015. These institutions are now on a hot streak unseen since 1965.

We saw this 21^st-century trend gain even more steam in the past few months. Kazakhstan bought 100,000 more ounces in January in a purchase that maintained a 40-month streak of additions; its reserves stand at 7.2 million ounces, up from 6.2 million a year ago.

Russia also dipped its toes in, adding about 700,000 ounces in January to bring its holdings to 46.2 million.

China buying privately and officially: China, too, has been announcing purchases since last year. China will continue to take advantage of the current low prices for gold by both adding to official reserves and encouraging private gold purchases by its citizens, Gold Newsletter editor Brien Lundin confirmed to MarketWatch.

Despite occasional lulls in action, central banks bought gold with renewed vigor in the second half of 2015, the World Gold Council reported, citing the impetus to diversify away from the U.S. dollar, and most analysts think that wont be changing anytime soon.

We expect further official purchases to continue to be one of several factors supporting the price of gold in the next few years, Simona Gambarini of Capital Economics told Bloomberg, while George Milling-Stanley of State Street Global Advisors told MarketWatch: I am expecting demand to remain strong, some small seasonal fluctuations aside, because while todays prices are higher than 2015, they are still considerably lower than four or five years ago.

Reinforcing golds credentials: Central-bank buying is just one piece in an ongoing perfect storm for gold in 2016. Official sector purchases, combined with strength in the Asian markets and continuing momentum in the U.S. and Europe, reinforced golds credentials as a portfolio diversifier, a wealth preservation tool and a hedge against a range of risks, the gold councils Alistair Hewitt asserted in conjunction with the release of the WGCs most recent Gold Trends Report.

Renewed ETF inflows in the West, continuing Asian demand, sinking expectations for interest rates across the globe, Chinas slowing economy and growing debt, plummeting oil prices, unexpected weakness in the U.S. dollar its all coming together for gold in 2016, and central-bank purchases will add long-term support.

A Feb. 26 CoinWeek article headline posed the question, Are gold coins driving buying momentum? Judging by the U.S. Mints February sales figures, the answer is leaning toward yes.

Although gold is outshining silver this year, finishing the month up more than 10% to add to its 6% gain in January, the Mints 2016 silver American Eagle sales have smashed yet another record. Sales hit 4,782,000 for the month, making it the best-performing February in Mint history and the 11^th-highest month ever.

On pace for another annual record: Almost 11 million silver Eagles have been purchased in 2016, and if this pace continues, the sales record of 47 million set last year could well be shattered.

Although totals dipped by 20% from this past Januarys 5,954,500 tally, sales exploded by 58% versus those in February 2015. The sales totals are all the more amazing considering that the Mint continues to ration silver Eagles on a weekly basis, allocating a maximum number of coins (usually around 1 million) to wholesalers because of a shortage of planchets, or coin blanks.

Gold Eagle sales quadruple year over year: Gold American Eagles also are in hot demand. The Mint reported that 83,500 ounces of the 2016 issues were sold in February. Thats down 33% versus the prior month but up more than 350% over the 18,500 ounces purchased in February 2015. For the year so far, sales total 207,500 ounces for a 108.5% increase from the 99,500 ounces sold during the first two months of last year, Coin News reported.

The Mints other gold bullion coin, the gold Buffalo, followed a similar pattern: February saw 19,000 ounces sold, down about 44% versus Januarys 34,000-ounce total but up more than 58% versus February 2015s sales.

Singapore firms sales doubling monthly: And its not just the U.S. Mint reporting massive interest in metals. Check out this recent CNBC interview with Raphael Scherer, a chief international officer at Degussa. Our subsidiary here in Singapore is doubling their sales numbers almost every month now, he said. Buyers come from almost every place in the world. Theyre buying in particular the investment products like bullion and coins, kilo bars, Krugerrands, Maple Leafs, mainly investment products. Our forecast is going above $1,300 going toward $1,400 by the end of this year.

Thus, while gold ETF inflows have helped power the yellow metal into bullish territory, so too have coin sales.

Gold-silver ratio zooming higher: And its no wonder that some investors are piling into silver. The gold-silver ratio recently crossed above 83, its highest level since 2008, meaning that it takes about 83 ounces of silver to buy one ounce of gold.

Some see that as a sign that silver is undervalued. Its also a testament to golds allure as a safe haven amid 2016s multiple uncertainties.

Gold is showing the way higher for silver, wrote Jesses Amricain Caf. The gold/silver ratio is hovering around 80 which indicates either a secular squeeze in physical gold and/or a risk related flight to safety.

Silver is half precious metal, half industrial metal, and it hasnt been the safety play that gold has, Optionsellers.com founder James Cordier told Bloomberg. Gold certainly has done extremely well with uncertainty around the world and with the idea that interest rates wont be rising. Until global growth comes up, the gold-silver ratio will continue to widen.

Buying silver with the gold/silver ratio at 80 is like buying gold on steroids, added Dave Kranzler of Investment Research Dynamics.

Precious metals remain the safety play of 2016, as evidenced by physical coin and bar sales. Pick your poison, gold and/or silver. But right now, silver offers a cheap entry price, especially for those who think gold has risen too quickly in recent weeks.

Golds fortunes have turned around in 2016, and likewise, the miners that produce the yellow metal also are seeing their stocks rise.

BMO Capital Markets this week hosted the 25^th Global Metals and Mining Conference in Hollywood, Fla., where several top industry executives weighed in on golds prospects going forward.

The fundamentals which keep the price of gold up havent changed, whether its jewelry demand, whether its fear about uncertainty and also potentially negative interest rates, which are what people are talking about, and thats given the good support to the gold price, Anglogold Ashanti CEO Srinivasan Venkatakrishnan told CNBC on Monday.

A lot of people moving into gold: Negative interest rates, which are currently in force in Japan and several parts of Europe, will continue to boost gold, especially if the Federal Reserve follows suit. Gold will go up simply because youre actually getting benefit by keeping physical gold or gold equities, he said. They appreciate, as compared to the other classes of investments. And thats the thesis behind it. And youre starting to see a lot of people moving in that direction and funds coming into gold funds.

From the supply standpoint, companies have been pulling back on their expansion and exploration plans, he noted. What you will certainly see is a decline in gold production coming, and it takes about 10 to 13 years for a new gold project to take off. So you will see that supply being squeezed, he said.

For Venkatakrishnan, the cycle is now turning in golds favor, though it wont always be smooth sailing. The four-year bear run in the gold market has to unwind at some stage, and youre starting to see gold position itself very well to basically get the uptick, so Im not convinced its a short-term trend which youre seeing, but there could be volatility, certainly through 2016.

Mine supply to drop by 17%: And Newmont Mining chief Gary Goldberg also outlined a bullish case for gold, concentrating on simple supply-and-demand fundamentals. Fundamentals for the medium to long term are good for gold when you look at both the supply and the demand side, he told CNBC.

On the supply side, people havent been investing in new gold mines. You havent had the investment in exploration. You expect new mine supply to drop by about 17% over the next five years. Demand is still strong. Asia is still the major place where gold goes. Half the gold is consumed in China and India. With the middle class in China going from 300 million to 500 million, India moving to 500 million by 2025 thats all good for gold.

Very positive thanks to negative rates: The Fed will continue to play a key role as well in golds direction, especially if it backs off its plans to raise interest rates as many as four times this year. Over the last couple of weeks, whats happened? Youve had a lot of uncertainty; youve had the Fed finally raise interest rates, which I think dampened the price of gold last year youve finally seen that come off over the last couple of months.

And if the Fed caves and goes negative on rates, I think thats a very positive thing for gold, Goldberg commented.

The grim outlook that miners were facing a year ago has dissipated somewhat for now thanks to the tailwind of higher bullion prices. Playing the mining stocks can add alpha to your gold bets, but like most any investments, dont bet the whole hog. Endless variables from energy and labor costs to disease, war, and environmental regulations can disrupt mining operations and gouge stock values. Therefore, make sure your core gold holding is in the metal itself: physical, tangible gold, plus silver bullion and rare coins.

The twin policies of negative interest rates and large-denomination cash bans will have a beneficial effect on the prices of alternative stores of value, argues Reuters columnist James Saft, in a Feb. 25 article, titled War on cash to pump up silver, wine, art, gold.

The obvious beneficiary of negative rates will be precious metals, Saft notes, but also collectibles and other investments of passion.

Saft invokes a catchy acronym for go-to hard assets coined by economist and author Joe Roseman: SWAG, for Silver, Wine, Art, and Gold.

Investors are increasingly forced to seek alternative asset classes to insulate themselves in this war on cash, Roseman noted. Simply put, very few asset classes can act effectively as an alternative safe haven.

Bullion is not a collectible: But its a mistake to equate silver and gold bullion with wine and art. The former are commodities, and their prices can fluctuate according to a variety of factors. The latter, though, are collectibles that assume much of their value from their rarity, provenance, and aesthetic qualities.

Silver and gold have their collectible counterparts, of course, and that would be rare coins. Numismatic coins are not limited to just silver and gold: Classic U.S. coins cover the waterfront in composition, with copper, nickel, and even steel being used to create metallic currency. You’ll find copper coins weighing less than an ounce that are worth 10 times or more the value of a full ounce of gold bullion. Just witness the recent sale of Tom Reynolds collection of large cents from the 18^th and 19^th centuries: 332 pennies commanded almost $6.5 million, with each cent averaging nearly $20,000. That inherent numismatic rarity makes certain collectible coins much more valuable than gold bullion.

$500 billion for just 2 paintings: Saft is correct that gold and silver will gain during the new war on cash and savers, but collectible coins could stand to gain even more. We’re already seeing tremendous results in the art world, with billionaire Kevin Griffin paying David Geffens foundation about $500 million for two paintings: one by Jackson Pollock and the other by Willem de Kooning. High-profile sales of other top-of-the-line collectibles also have made headlines, such as classic cars. For example, a rare 1957 Ferrari 335 S Scaglietti sold for $39.8 million to become the most expensive car ever auctioned.

In the numismatic world, the most recent sale of the D. Brent Pogue collection also proved the mettle of rare coins, bringing in a total of $17 million, with one 1793 Chain Cent almost breaking the $1 million mark.

Coins up 232% in 10 years: The record of rare coins speaks for itself, even before the idea of negative interest rates began sweeping the globe. The Knight Frank consultancy’s most recent Luxury Investment Index, updated through September 2015, found that numismatic coins were the No. 3 high-end collectible investment for the preceding 12 months, gaining 13% to finish behind just art (15%) and classic cars (18%) among a group of high-end categories (including stamps, jewelry, watches, etc.).

Over the longer haul, rare coins did even better. Over the previous five years, coin prices finished in second place with a 92% increase, lagging only cars, which generated 161% growth. The overall index gained 63% over five years.

And in the 10-year span, rare coins finished in fourth place with a 232% gain, behind art (239%), wine (243%), and cars (496%). The overall index rose 206% over the decade. In contrast, gold bullion rose by 174% during the decade.

If coins were posting these kinds of numbers in just a zero-interest-rate environment, imagine what they’ll do under a negative-rare regime.

SWAG is where investors want to be when cash has become trash thanks to the reckless central bankers. But don’t forget that rare coins can outperform gold and silver bullion by exponential leaps and bounds over time.

By Douglas LePre, Senior Portfolio Manager at Blanchard and Company, Inc.

Today’s rare coin market has the highest number of active investors looking to diversify their financial portfolios than any other time in history, and each of them has entered the market with various goals. Some are looking for gains, some are building legacies to leave for their heirs, and some are just looking for a safe haven from equities, the dollar, and the banks. Regardless as to their motivation, investors are looking at rare coins as important investments, and certain segments of this market have proven to be a great hedge for peoples portfolios.

Historically, many investors looking for a hedge have turned to the big three precious metals: silver, gold, and platinum. But these markets have dramatically changed over the past five to 10 years. So the question becomes how should an investor hedge a traditional portfolio while maintaining liquidity and keeping volatility at bay? The dictionary defines a hedge as: an act or means of preventing complete loss of a bet, an argument, an investment, or the like. So, a hedge really isn’t about growth as much as it is about providing stability when markets become unstable. The rare coin market holds far more hedge tools that most are aware of. Here are a few of the most efficient:

Semi-Key Date Rarities

Semi-key date coins are exactly what they sound like. They are coins that are considered too rare to be classified as generic but are still not as elusive as the rarest key dates. Every issue has its semi-key dates. Not only are they fun to research, but they work especially well as a hedge.

Private and Territorial Gold

During the California Gold Rush, miners were challenged with discovering safe and economical means of getting their gold to the East Coast for assay and coining. The desperate need for a branch mint had been outweighed by a combination of politics and sectional rivalries. The federal government refused to authorize a mint for any of the gold mining areas. While the U.S. Constitution expressly prohibited the states from issuing their own money, there was no law against individuals doing so, hence the existence of this very intriguing portion of the market. Even with the decline in the value of gold over the past four years, the values of these types of coins have remained steadfast.

Carson City Coinage

Carson City coinage has always had the ability to stand on its own and has never had to rely on a market maker in order to achieve its status. Simply said, this is an issue that is appealing to both investors and collectors alike due to its amazing history, popularity, and rarity. It remains very steadfast in the market, including silver dollars or gold issues such as eagles or $20 Liberties.

Owning anything from the Carson City Mint largely ensures its equity is safe.

These are just a few of the areas in the market that can fill the need for a hedge tool without the volatility that exists in the equities. The process of finding what to purchase first starts with identifying the motivation for the buy before ever spending a dime. A trusted professional can help.

Gold soared again Wednesday after two heavy doses of bad economic news coldcocked the U.S. outlook.

First off, although the U.S. services sector has been hailed as a bright spot in the economy, the latest PMI survey showed otherwise: It collapsed to 49.8, well below expectations of 53.5. The decline signaled the weakest service-sector performance since the government shutdown temporarily disrupted business activity in October 2013, Markit noted, forecasting a significant risk of the U.S. economy falling into contraction in the first quarter.

Now on to housing, another purported pillar of the recovery:New-home sales declined by 9.2% in January, the biggest drop for that month going back to 2009, and prices also took a big hit.

Stocks struggled early on but pared some losses by afternoon and eventually turned positive as oil prices also remained volatile. Gold, in contrast, pulled off another big advance and ended at more-than-one-week highs, not far from its 2016 peak near $1,260, hit Feb. 11.

Hyper bullish sentiment: The metal topped $1,245 and gained more than 1.5%, while silver also rose 1.2% to reach $15.46 before a late-afternoon pullback.

Inflows into gold ETFs continue to be a key driver for the metal. Retail sentiment for gold has suddenly become hyper bullish, Insignia Consultants analyst Chintan Karnani told MarketWatch, citing ETF demand.

Meanwhile, central-bank support for gold also remains a robust trend, with both Kazakhstan and Russia increasing their bullion reserves in December, according to new IMF data.

Up about 16% on the year, golds continuing strength has forced another high-profile bearish analyst to reconsider his forecasts. ABN AMRO exec Georgette Boele recently made news by retooling her price target from $900 to $1,300. Now one of the most accurate gold forecasters of recent years also is sounding a more optimistic note on the metal, according to Bloomberg.

Gold showing its superhero mettle: Whereas Oversea-Chinese Banking Corp. economist Barnabas Gan previously predicted gold would finish the year near $950, bullions staying power has cause him to soften his stance. Hes now raised his price goal to $1,000-$1,150 by years end, says it will hold the $1,200 level this quarter, and thinks it could run much higher under the right conditions.

Should risk aversion dominate amid intensified global growth headwinds, gold may well rally to as high as $1,400, he wrote, noting that amid the global equity downturn, very low oil prices and magnified risk aversion seen since the start of the year, one hero stood up strong, providing shelter, describing bullion as a gold, the superhero.

If golds surprising outperformance in 2016 gains further momentum, then even Goldman Sachs will have to change its official line on the yellow metal. Almost everyone thinks theyre wrong at this point, anyhow.