I’ve been seeing many people calling rare coins a new gold rush for those smart enough to invest now. But I’ve similarly heard stories of wealthy investors who don’t know enough about the numismatic world being conned out of thousands as they’re too eager to spend big money on coins that really aren’t worth that much. What are your thoughts on investing in coins? Just to be clear by ‘investing in coins’ I don’t mean spending money to add coins to a personal collection (and maybe turning a profit on them in the future, but the main goal is just collecting for fun), I mean spending money on rare coins that you don’t know much about or don’t care much about with the explicit intention of selling them on for a profit.
My personal opinion is that the market is just too volatile. Sure, there is money to be made, but those are rare success stories. My thoughts on why the market is so volatile are:
1. no real price to go by. With, for example, stocks and forex there is a place where you can see their real-time values to trade by. There are catalogues that give approximate prices, but these are not updated in real-time and are usually wildly out of date. A coin is worth as much as someone is willing to pay for it, and because of this it is impossible to chart a coin’s value in real-time.
2. The instability of coins themselves. The number of currencies on the forex market is stable (and if not stable, new currencies are tracked in real-time), while such stability does not exist in the world of coins. The only known 1933 double eagle in private hands sold for $7.59 million, but what if a crate full of them was found in the mint’s basement (I know this is extremely unlikely and the coins probably wouldn’t go onto the private market, but similar things have happened with other coins like the CC Morgan dollars and the 1933 British penny so my point still stands)?
3. The handling and preservation that coins require. Rare coins need to be graded and encapsulated to increase their value and preserve any lustre/detail they may have. Obviously there are well-established services like the PCGS and the NGC and some dodgier services like the International Numismatic Bureau. Similarly to how investing in art is very hard due to the restoration, evaluation and preservation work required on paintings, it seems that coins are also difficult to approach for an investor that doesn’t already collect coins. Stocks, forex and crypto do not need preservation as they are completely virtual.
I understand that most investors are just investing in rare coins to diversify in case their other assets crash in value, and I’m fine with that. It’s just the people that put all their money into coins that they don’t even enjoy that are a bit foolish.
And that’s my second rant finished.
Interesting. So many fellow collectors around me say that they are investing when they collect. But I'm not so sure about it.
The question should be clarified first: what coins are you talking about? Base metal or not, graded/ungraded, regular/commemorative/NCLT, circulated/UNC, and how old? What price range do you mean?
For example, when keeping a commemorative 2 euro coin taken from circulation, some people seriously consider it as an investment. Is this a good idea?
I’m talking about people that don’t know much about coins buying very pricey graded coins without having any interest in collecting them and just wanting to sell them for a profit. They can be modern or ancient, gold or steel, as long as they’re in the highest price range. In all fairness, taking a commemorative from circulation is an ok investment. It’s not going to pay off any time soon and the payoff certainly isn’t going to be big, but you got it for face value. The more common ones are definitely wasting your time (unless you want your great-grandchildren to sell it in hundreds of years) but a rarer or non-circulating commemorative will nearly certainly pay off within 10 years. As I said though, It’s not going to be a huge payoff by any means (the biggest I know in the UK is the Kew Gardens 50p which regularly goes for £100, but there’s a huge drop off from there with the second rarest selling for between £5 and £10), but it’s a payoff nonetheless.
Modern coins such as the Kew Gardens 50p I would be very carefull with. On modern coins you often see prices heavily inflate just to heavily drop just a few years later.
Different story for old Rare coins in excellent quality, here I see quite the opportunity for good growth in value.
A Rare gold coin from the 1600's chances that a big box full of them is suddenly found is very slim.
For sure there is always a risk in investments.
If you like coins, medals and tokens with ship motives follow my new instagram account with regular updates @numisnautiker
From time to time I sell some coins on Ebay make sure to follow me @apuking on Ebay.
I would definitely advise one not to spend large amounts of money on a modern commemorative, but if you find one in change that’s not beaten up it’s a good thing to keep for a few years!
Quote: "apuking"Modern coins such as the Kew Gardens 50p I would be very carefull with. On modern coins you often see prices heavily inflate just to heavily drop just a few years later.
Different story for old Rare coins in excellent quality, here I see quite the opportunity for good growth in value.
A Rare gold coin from the 1600's chances that a big box full of them is suddenly found is very slim.
For sure there is always a risk in investments.
- Great advice & I would say the same for modern banknotes which become labelled as "rarities" (although I'm sure there are a few do exist). In Canada, we rarely saw any $5 HBG prefix with the Macklem-Carney signature combination on the release of our CDN Frontiers polymer series. Some collectors speculated that they were probably extremely rare in house test-like notes that slipped out into circulation. Unfortunately, I bought into this "theory" and bought one at a pretty steep price. Then, about 2 years later, the Bank of Canada released a few million (to squash any chance of this note being rare). This was unprecedented (BOC never released their first prefix several years later) but so what- there was my investment up in smoke. Sure they were "less-common" signature change-overs (majority are Macklem-Poloz) but every CDN forum picked up on the fact that they were no longer "rare" & my expensive circulated example had literally plummeted to FV (Face Value) overnight.
Now in Australia there is a similar phenomenon with their 2019 $20 "Lowe-Fraser" signature combo (which are indeed uncommon) but many eBay sellers are asking for a steep premium on these in circulated condition. All it takes is one collector to lay their hands on a bundle (or brick) & all these circulated examples will become pretty cheap fairly fast.
I heard a story (from the Sun newspaper so take it with an entire salt mine) about a rather wealthy man who knew nothing about coins being conned into buying a set of coins as an investment. He spent £50,000 when the coins were worth £20,000.
Probably greatly exaggerated knowing the Sun, but this kind of stuff happens all the time to the people that don’t know better and fall for a craze they know nothing about.
P.S. For modern commemoratives, the only real chance you have of ‘investing’ in them is by buying an uncirculated one directly from the mint as soon as it’s released. I wouldn’t even touch the secondary market with those things.
It is not clever to invest in things, you like. If the price goes up you maybe do not like to sell them.
And, imo, modern commemoratives and NLTC are a complete waste of money.
IMO: coins & banknotes that are sold as "collector's items" are probably the worst "investment." They're meant for the "armchair collector," normally not issued (have no chance of being circulated) so the whole concept of condition is irrelevant (unless in poor condition!)- which most aren't.
So I exclude: proofs, specimens, colour trials & anything in a folder (with a folder like prefix). I'm not even interested in high denominations as so many of these get stashed in SDB's.
If you want your collection to grow in value you must do the research of what's popular & what's rare (due diligence) & even then there's. no guarantees...
Keep in mind you might find something "rare" (or 'tough') but if it's not popular -then it doesn't really matter how "rare/tough" it is.
I wouldn't trust for coins as a investment as the collector base may be much lower in coming years. Though I have "invested" in silver coins, mostly world NCLT's as the silver price is relatively low. I buy only one per type and pay usually bullion value +-10% shipping included. I quess I can't sell them away if price triples, but I enjoy them and sell if I really need that money some day. In these coins the original issuing price has been multiple compared to my winning bids in auctions.
Living in Florida, as I'm currently cursed to endure, I know a lot of people who we would consider wealthy. Not in the Bill Gates class but enough to join the Boat Club, y'know? None of them made their wealth by investing in coins. If you have money to invest then put it in a mutual fund or if it really has to be coins, a big old bag of junk silver. It's true that truly top tier coins will always hold value but it's a devilish market to predict. More so in the coming digital age where "coins" won't be around to spark the interest of a new generation of collectors.
One thing though that I can state with absolute certainty - anyone investing in "special collectors coins" produced entirely for non commercial use and peddled on TV by Coin Evangelists as investment opportunities is going to get fleeced. Your gold plated, limited edition, state quarters are worth exactly 25c and in 20 years time they will be worth the same.
Non illegitimis carborundum est. Excellent advice for all coins.
Make Numismatics Great Again!
Quote: "Trp"I wouldn't trust for coins as a investment as the collector base may be much lower in coming years.
Excellent point: new generations (I have four such at home!) are increasingly disinterested in anything "old" and don't have the time or the patience for such time-waste as collecting. Their pace is faster and concentration span shorter.
Quote: "Trp"I wouldn't trust for coins as a investment as the collector base may be much lower in coming years.
Excellent point: new generations (I have four such at home!) are increasingly disinterested in anything "old" and don't have the time or the patience for such time-waste as collecting. Their pace is faster and concentration span shorter.
I don't know. When I started collecting banknotes 40+ years ago I was lucky if a stall was set up at our local mall. Then Sears started to sell. The first coins shows were almost a waste of time (so few tables on the bourse). Lately, there's hardly a dealer that doesn't sell notes as well as coins. My great aunt called me a "minute monster" and my dad much worse. Most of the older generations thought we had the attention spans of fruit flies. I think it's just a matter of perspective in terms of what younger generations will do with their pastimes. Sure they will find other pursuits (we all did) & yes all of our tastes/hobbies/trends do change our values but do you really think that this "new generation" are really that different from us older folks & won't ever come to appreciate some silver coin with a unique engraving nor a printed paper/polymer banknote designed to be eye catching? And I have seen far more women in this hobby than ever before. People still appreciate tangible assets such as cash, collectible coins & real estate. When this pandemic hit - I thought that would be the beginning of the end for the hobby- if anything (with people having more time on their hands) it's been unforeseen shot in the arm!
But all of that doesn't really come into play when discussing whether rare coins are a good investment. If younger people are completely oblivious to the value of something tangible & rather pump all their savings only into virtual currency (such as stocks/Bitcoin) then that may change things. I hardly think that will happen. If they're from a country which has had power outages (& appreciate how fleeting/volatile virtual currency/markets can be) they might prefer tangible assets over virtual ones.
Be sure you understand the difference between collecting and investing when purchasing coins.
I love collecting, but need to invest to protect my future.
For collecting, I'm trying to get a complete set of Mexican 20 Centavos 1943 -1974. So far I have about half of them in AU-Unc condition. Average price has been about 15 cents. I enjoy the hunt.
For investments I'm currently working on ante-bellum gold. I think it has real upside potential.
Some may think it it unwise to devote equal time to both, but I want as much play time as I devote to work.
A smart man learns from his mistakes. A smarter man learns from someone else's.
Quote: "Kurt53"Be sure you understand the difference between collecting and investing when purchasing coins.
I love collecting, but need to invest to protect my future.
For collecting, I'm trying to get a complete set of Mexican 20 Centavos 1943 -1974. So far I have about half of them in AU-Unc condition. Average price has been about 15 cents. I enjoy the hunt.
For investments I'm currently working on ante-bellum gold. I think it has real upside potential.
Some may think it it unwise to devote equal time to both, but I want as much play time as I devote to work.
True. I think that's a good point & the OP:
" I mean spending money on rare coins that you don’t know much about or don’t care much about with the explicit intention of selling them on for a profit."
- I think if one is to invest in an expensive "rare coin" then one should know a lot about that particular piece (pop reports, etc.,) no matter what the intention is in terms of save or sell. I also agree that there are a lot better (more accessible) and easier assets to invest in though.
I'm with Nightingale, if you want to invest stay away from the Home Shopping Network. They sell everything at inflated prices and promote with a meanings of rare and valuable that do not exist in the dictionary. But they come in nice boxes. Tell your relatives not to buy for you these overpriced gifts.
Quote: "ThePoet"I'm with Nightingale, if you want to invest stay away from the Home Shopping Network. They sell everything at inflated prices and promote with a meanings of rare and valuable that do not exist in the dictionary. But they come in nice boxes. Tell your relatives not to buy for you these overpriced gifts.
oh no, HSN. Westminster collection, Bradford exchange and American coin treasures are scammers as well, but from what I’ve seen, HSN is by far the worst.
Quote: "ThePoet"I'm with Nightingale, if you want to invest stay away from the Home Shopping Network. They sell everything at inflated prices and promote with a meanings of rare and valuable that do not exist in the dictionary. But they come in nice boxes. Tell your relatives not to buy for you these overpriced gifts.
oh no, HSN. Westminster collection, Bradford exchange and American coin treasures are scammers as well, but from what I’ve seen, HSN is by far the worst.
edit: no idea why the exact same message got posted twice. A glitch or my memory acting up?
Quote: "Serial_Number_8"IMO: coins & banknotes that are sold as "collector's items" are probably the worst "investment." They're meant for the "armchair collector," normally not issued (have no chance of being circulated) so the whole concept of condition is irrelevant (unless in poor condition!)- which most aren't.
So I exclude: proofs, specimens, colour trials & anything in a folder (with a folder like prefix). I'm not even interested in high denominations as so many of these get stashed in SDB's.
If you want your collection to grow in value you must do the research of what's popular & what's rare (due diligence) & even then there's. no guarantees...
Keep in mind you might find something "rare" (or 'tough') but if it's not popular -then it doesn't really matter how "rare/tough" it is.
older proofs (generally before 1950) are very valuable though.
Quote: "Serial_Number_8"IMO: coins & banknotes that are sold as "collector's items" are probably the worst "investment." They're meant for the "armchair collector," normally not issued (have no chance of being circulated) so the whole concept of condition is irrelevant (unless in poor condition!)- which most aren't.
So I exclude: proofs, specimens, colour trials & anything in a folder (with a folder like prefix). I'm not even interested in high denominations as so many of these get stashed in SDB's.
If you want your collection to grow in value you must do the research of what's popular & what's rare (due diligence) & even then there's. no guarantees...
Keep in mind you might find something "rare" (or 'tough') but if it's not popular -then it doesn't really matter how "rare/tough" it is.
older proofs (generally before 1950) are very valuable though.
- Yes, I'm sure that's the case but I'd prefer to focus on affordable pieces. Proofs, colour trials & specimens of some rarer series (or popular national issues/denominations) can be smart buys but they're typically expensive at the entry level. When talking coins pre-1950: many often have high silver content so that alone can influence market demand (& future inherent investment value). Since most of these set one back quite a bit right from the "get-go," they're typically a rich person's passion.
I tend to encourage banknote collectors to focus on issues that were meant for general circulation but are in original UNC grades. [BTW: there are many affordable specimens of world banknotes but that's b/c very few collectors collect them]. For banknotes, "no-brainers" with world market appeal include Commonwealth nations/series (like Devil's Face or Seychelles.) Specimen Devil Face banknotes were expensive when the BOC first auctioned them off (& they will remain that way). In the US the 1928 Red Seal $1 is quite popular (so doesn't matter what you buy so long as its EPQ and above VF35 - it should do well). This statement may be just as valid for the US $500, $1000 & $5000 banknotes but (like their proofs/specimens counterparts) they're also dear to get in the first place & usually attract only an elite set of wealthy collectors.
(As a side note - I still see banknotes offered in folders at a discount b/c many collectors have a bias against these showpieces- feeling they may have been exposed to light more than other notes (& thus faded)). Sometimes TPG certifiers mark them down as "Net" or "Mounted" which further reduces collector appeal (& liquidity).
For coins, I think that's why errors have become all the rage recently since it's a pretty democratic (level) playing field & collectors can attain them at modest prices (but their potential is still so healthy).
As far as investing, Im not sure Id call it that. But, I do have guidelines I picked up throughout my life that I follow. The countries I collect as more of a passion, I will spend however as much as I can afford to complete a date set, series whatever it may be. Nothing much over $100.00 is my max.Now I know Im probably be lucky to break even on that part of my collection.
Most of the other coins I buy only if I know I can get my money back, preferably make a little. If I can make $2+ on the sale/swap of a coin Im happy. Most have a much better return then that.
Also Im a firm believer in silver. Ive been collecting it for a bit now. I try to buy it with all my spare $$. I figure the silver I accumulate while collecting coins is a direct benefit of my collecting coins. Im not so sure I would of discovered silver if I never started collecting coins.Research is also an essential part of my collecting. So many varieties,mistakes on listings, wrong info, wrong coins, are on coin descriptions. Knowing what your looking at can really pay off .Ive ran across this plenty of times.
I think if you follow a few simple rules ,coin collecting can definitely be a good investment.If your plan is to get rich quick, I think you could do better someplace else.
In the long run, no matter how much $$ you spend on coins, your going to at least have something tangible,valuable at the end of the day.
Quote: "apuking"Modern coins such as the Kew Gardens 50p I would be very carefull with. On modern coins you often see prices heavily inflate just to heavily drop just a few years later.
Different story for old Rare coins in excellent quality, here I see quite the opportunity for good growth in value.
A Rare gold coin from the 1600's chances that a big box full of them is suddenly found is very slim.
For sure there is always a risk in investments.
