OK, so this is going to be a question/introduction post I am 22, and when I was younger (about 8-14) I was a serious collector (as serious as a kid could be). Lost interest until recently. I started buying a few gold coins as an investment...and now I am hooked on coins again...even more than I was before. I am focusing on a type set of my "dream coins" (or coins I find that become dream coins) OK, so there's my short and sweet story, My question is, are "rare" coins, or desirable, coins considered (in your mind) as strong of an investment as gold? I have a $20 Gaudens worth around $2.5-3k that I would love to sell and get something I really want (the only reason I have it is because of the gold). I would love the answer to be "sell it and buy the coin you want" but I would really like your honest answer from an investment and solely an investment standpoint. I already have some new coins that I love, so I don't need to invest in what makes me happy (at this minute) but ya... The reason I am asking is because I am now a poor post-college kid with expensive hobbies...and if I am going to get any of the high-end coins I want, at this point, I would probably have to sell one of my gold pieces. (recently got an ms63 $20 lib. Not rare, but I like it a lot more than my Gaudens) Sorry if that was long and drawn out, but I would love to hear what you think!
I say sell it and buy what will make you happy. Coin collecting is a hobby, and you should enjoy it. If you are interested in gold and silver, thats great because there will always be value there. But you should aproach it as a hobby. And the financial upside is that if you ever have an absolute emergency, your collection is worth money and easy to liquidate. Just have fun is my suggestion. And by the way, I relate to you alot. I got started early, got out of it for a while, and then got back in around age 22. (I'm 28 now) Welcome to cointalk!
Honest answer, numismatic is a hobby, and it should be treated as such. If you want to turn coins into an investment, imo, it takes all the fun out of the hobby. Can rare coins be an investment, sure, but like any other investment there's risk involved, and there are much safer investments out there. Asking are rare coins a better investment than gold, is the same asking which stock is going to do better, you're going to get a bunch of different answers, all based on guesses really (some educated and some not). And if anyone did definitively know the answer to which is the better investment, they certainly wouldn't share that information for free on a public forum.
If you like gold so much then sell it and buy a piece of gold to replace it and spend the rest on coins you like. Have fun. Many people believe that one should keep a percentage of their wealth in gold. This is just insurance against the decline of the currency.
Gold and silver bullion coins have certainly been a great investment over the last 10 years or so. But again you are talking two different investment categories, driven by two different markets; Rare/collectible coins versus bullion. Rare coins can be an investment, but that market is driven by collectors, who are willing to pay a premium for the specific rare coin in question. One common piece of advice you will hear about investing in rare coins is to buy quality; purchase a key date coin, in a popular series, in the best condition that you can afford. Precious metals in the form of bullion coins, are driven by the market price of silver or gold. This market is equally tough to predict, however we are now in the middle of one of the biggest Precious Metal bull markets in recent memory. If you buy large quantities now, you might be getting in at or near the top. Then again the bull may have a ways to run yet. It's tough to predict which one will be a better investment over a given period of time, because there are so many different variables that affect each different market. So I think the best advice is buy what you like, and be prepared to hold onto one or the other for the long haul. Generally investing in coins and bullion for the long term, and I mean 5-20 years or more, will increase your chances of getting a positive return on your investment. Why? Because it allows you more flexibility to decide when to get out, ie when to sell so you can cash in on your investment. Chances are the value of each investment will fluctuate up and down over time. You want to sell when the value is up. Increasing your time horizon generally increases the amount of peaks along the x axis on the sine curve. You want to sell at the peaks and buy on the dips. Good luck.
A St. Gaudens worth 2.5k to 3k is already something worth far beyond gold value. Personally, numismatics is both a hobby and an investment. If you are going to sell this coin to buy coins you want which have a significantly smaller collectible premium above bullion value than this coin, I would say keep this coin and sell off other coins that are more common. I never could understand people that are willing to lose money to collect. It's too easy to collect and also make money while doing it, all you need is some knowledge and a mentality that will not lead you to make impulsive and thus poor financial decisions.
I probably wouldnt sell right this minute...I would wait until gold went back up (at least a little) first. But I did buy the coin for around $1,500...so I'm ahead no matter what
You must be a better buyer than I. If I had to sell my coins, I sure as heck would lose money on many of them, probably most of them I have bought in the last 5 years at least. Have you actually SOLD the coins you claim you have made money on? The only way I could see that statement as true is either you bought a bunch of PM investments in the last 5 years, or you have gotten some scorching good deals. I like to think I am a good shopper, but I realize there is a tremendous difference between what I pay for it and what I can sell to a dealer for. Just for the record, I bought a few thousand ounces of junk silver at $4 or so, so yes I have profited on those, but I do not consider these to be profits from coin collecting. Chris
Any of the coins I have bought in the last year or so since I started collecting on I could easily make a profit on. It might have to be ebay, but I would still make a profit. I'm not in the situation (and I'm not the kind of person) who would just go and pay full blown retail for a coin I want...so maybe that's why...
In my opinion, rare coins are less attractive purely as an investment because of transaction costs. If you buy and sell through reputable dealers, the bid-ask spread is much higher than bullion. The same is true for "live" auctions. In addition, even reputable dealers of slabbed coins can try to impose a "grade spread" in addition to the money spread. If you choose to deal on eBay or with less established dealers, the spread is less but the risk of a failed transaction is higher. Finally, with bullion there's less chance of making mistakes through your own judgment calls. I know I've talked myself into coins that later turned out to be mistakes, both from a collecting and an investment standpoint. So if you enjoy the hobby, great. Buy rare coins. If you don't lose too much money on it when it's time for you (or your heirs) to sell, so much the better.
Yes I deal on eBay, and I generally get good lot buys at auctions. I collect the best stuff and sell off the rest to re-invest. So yes I have made plenty of money from the coins I actually do sell. I do have a day job and consider my coin dealing part of my colelcting hobby a.k.a. side gig. However, I continue to spend $2,000 to $2,500 a month on coins without putting in any additional money made outside of that loop. And I've had the pleasure of building a fairly impressive foreign coin collection consisting mostly of silver and gold coins, while still coming out ahead monetarily. I don't mean to sound like a show-off, but since it came up I may as well add my experience. And honestly, I have plenty of competition from people that do the same. Not just the same few people, but dozens if not hundreds that I see fairly regularly. It's fair to say I would not even try to do this with US or ancient coins. Those markets are completely different from foreign.
Fair enough sir, but I would categorize you as making money dealing in coins, not collecting coins. Anyone actively running auctions to sell, and buying group lots is more in the business of dealing than collecting. Its great you can make money that way, but compared to an average collector buying one or two coins at a time at a show, its not really the same thing. To me, when I think of a collector I think of a friend who buys one Roman Republican coin a month. He shops around and tries to get the best deal, but he can only afford one coin a month. Chris
I started out as a collector in my childhood. I only started selling coins in my early years of college to pay for my education. Once I realized that is was quite profitable, and allowed me to collect the coins I really wanted but could not afford previously, I stuck with it. I understand what you are saying, but I feel that I'm dealing in order to be able to continue to collect and upgrade my coins. Basically, I'm not quitting my day job. =)
Understood, but I bet you half of all dealers are only dealers on a part time basis. Either way, point taken.
You're right about that. Just seeing the stuff many of my competitors buy and then sell, I'm like "Why the heck would you sell that?". Either they don't collect or have a super high end collection and are not interested in coins worth a measly few hundred dollars. Somehow I think it's the former rather than the latter. =/
I have always been the person to buy what I want (in a smart way) use it until I got sick of it, and make a profit. I have just always been able to do that. I am also very money-concious and stingy I guess you could say. But I like to think I am smart with money. Anyway, I guess that idea is what I am hoping I can do with coins. I understand there is a lot of knowledge and work that goes into this, but Id like to believe I could be good at it. When I got out of coins when I was younger, I made a significant amount on my collection over what I paid. In the end I wont be quitting my day job but it would be awesome to collect (which I love soo much now) and to maybe make a profit somewhere down the road. Thanks for all the response!
Seems like you already have the right background and mentality to be good at it. So, shoot for the stars!
