Do you buy coins that are over priced?

I have asked myself this question time and time again, when I see a real cool coin that I do not have. Often times they are priced over book value, and sometimes over market value. For me, there is no question, I enjoy my hobby to great lengths. If I see a coin that I don't have that I want, I buy it. Now, I do not mean I will pay 2x-3x what it is worth, but a few dollars more, sure thing. After all when will I have another chance at getting that coin? As well, me personally, I collect for the future not today. I hope that one day, either I hide my coins and put out a map, or that I can sell them 40 years down the road and retire comfortably.

What do you think?

Poll Question: Coin worth $5.00 in condition, is priced at $8.00. Do you buy it, or do you walk away? Assume that the price is non negotiable.

 

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I usually pay more if I have not seen the coin I am looking for a very long time. a common coin maybe a couple bucks more 2X-3X no way. do NOT buy coins in the hopes you will get rich off them later. If you buy a super rare coin maybe, but if it's a common coin you might not get a huge return on it later.

on your poll question... it all depends which coin it is ??? if you do the research on it and know what they go for... a couple bucks more will not hurt, but a couple hundreds dollars more might. again it all depends on what coin you are talking about. on a $5.00 dollar coin I guess I would if I really wanted it I would get it.

 

it depends on what you are looking to buy and how specific you are. if you just want say a Morgan dollar certified at ms64 you should not pay much over retail if at all. but if you want that morgan without any spots on it bright white with a great strike and a vam you are going to pay a bit more for it.

 

I will. There are times you have to if you wish to own that special coin.

 

Absolutely.

If nobody ever bought "overpriced" coins, you'd be able to buy an 1804 silver dollar for its bullion value.

 

Yes.

 

I would not pay 60% over market value unless I didn't know the market value.

 

Yes, for two possibilities.

#1
I see a REALLY cheap coin that I want.
Cheap coins are rarely listed alone so they are hard to find.
S&H would be higher than the coin's catalog value.
So I may end up paying $3 for a coin that catalogs 50¢.
This happens to me with coins that I want for my birthyear set.

#2
A more expensive coin that it has taken me several years to find, particularly if it completes a set.

 

I voted Yes, but of course there are caveats. As mentioned above, if a coin is rarely seen on the market that you need/want, than paying over market or book value is often necessary to add it to your collection. In this case, does that mean you've over paid or does it mean the price for said coin is actually rising?

If you look at the "CAC" model that there are A, B & C coins in any grade, than IMO, you will pay a bit more for an "A" coin in than than a "C" coin. I am willing to pay more for that "A" coin.

 

Thanks for input. As for buying coins to get rich, it is not necessarily that I am hoping I will get 100X my money, but it is a true investment. I do world coins only. Things with 100M each year made, yea they won't be worth much for a long time. However things with say 1M or 10M made, can increase in value pretty fast. However that is not what I am doing it for either. I spend say $100.00 on 50 coins, I cannot spend those coins, that $100.00 can only come back from selling those coins. Kind of a out-of-sight-out-of-mind thing. If they jump in value, I'd enjoy it, but I am not relying on it. I have about 10,000 world coins, with a very nice chunk of that, are coins less than 10M minted. So if I see a decent coin, that say has 1,685,000. Minted, and it books at $0.25 right now, I see no reason not to spend more than that, after all most world coins do go up in value over the course of say 50 years. The only issue I run into, is....... The appraisal fees, $0.50 per coin appraisal or 5% of total value is just a killer #

Please keep the votes coming.

 

Really? Can you give an example - country/year/KM# ?

 

Sure, i use a 1982 krause book, then my new book to see values.
Belgium km#139.1 100 francs 1950
Australia km#26 1 shilling 1922
All Yuan Shikai Chinese dollars, and jiao

 

It's hard to make $$$ on coins unless your in line at the ANA shows.

 

Not sure if the Krause values are real-world prices. I think you can only make money with coins that are already scarce (high grade, key date, variety, etc.) but not with those readily available today.

 

I have bought coins that were higher than the "market price" so in that sense, Yes I have bought coins that were "overpriced." But, I have never paid more than a coin (or anything else I collect) was worth to me. So, I would say that no, I have never bought an overpriced coin.

So, if that coin was worth $8 to me...then I would buy it. If not, I wouldn't.

 

I agree with CamaroDMD.

In aspect, I purchase a soda pop at a store for $1.59 USD. That soda pop costs about $0.15 to make, however I pay a lot more than that. I can't even recoup any of that loss ever. I decide to purchase a coin for say $20.00 that is likely only worth $15.00, as the years go on, more and more and more and more people will be born, and more people then into numismatics. The likelihood that a coin will lose value that is no longer in production is very low. The chances at gain are almost certain. I have not found very many coins in my Krause book from 82 that did not go up in my new one. This may be only a matter of $0.10 total. But let's break this down in my scenario. If I purchased my 10,000 coins for $1.00 each for a total of $10,000.00 and lets say every year each of those coins gains value by $0.01, that is $100.00 generated a year. Now figure that into 50 years from today, for a low of $0.50 per coin added to value: My total return would then be $15,000.00, which I believe is not realistic, because a lot of coins go up in price later on by more than $0.10 per year. My 3 examples are fine, but how about a more modern example:

A Cyprus 1 Piastre from 1949 in Gem BU condition, right now Krause says like $5.00-$8.00 I cannot remember which. The market value right now is over $20.00, there were a little over 1 million made of this coin. I do not see it only going up by $0.01 per year. It was only worth $2.25 in 1982.


If you have purchased a coin over value of books, and market: How much more did you pay, and has it started to pay off yet? please provide examples.

 

Depends
a. How long have I have been looking for the coin
b. How long until I find another one.
c. Is the eye appeal W@W

 

I see your logic but sometimes Krause world coin catalogs are good and sometimes they are not realistic in the real price world. over time you find out which coins are much harder to find/get. those harder to find coins will go up in value faster than a small percentage coin will.

 

I think you may have missed my point a little bit...I'm trying to come up with an extreme coin example that I have experienced but I haven't been able to come up with one. But, the point I am trying to make is that to the right collector...something might have far greater value than it's market value or even it's cost to produce.

Let me give you another example. Other than coins...I also collect sports cards. I'm very specific in what I collect, but there are a few out there that I an searching for.

My #1 card target is actually a "nobody" player. He is an old player who played back in the 1990s for the local college team and then spent a couple years in the NFL and never had much success. His cards are basically worthless (for the most part) but because I was a huge fan of his as a child...I have tried to collect all his issues. He had 49 total cards produced. He has 1 card that is extremely rare. In fact, only 1 was printed. It's unique. That is my "white whale." Because he is a nobody...the retail of such a card is probably less than $10. However, to me...I might even be willing to pay 10x that if I ever came across it. If I dropped $100 for that card, in my eyes I probably wouldn't have overpaid. But, compared to the retail value, I certainly would have. But...to me, it's worth far more.

That was my point. Each collector must decide what a particular piece is worth to them. Based on that...you buy it or pass. So, IMHO...few collectors truly "overpay."

 

Is that player Joey Harrington?