Thoughts on key date US coins as investment hobby?

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I wonder how many people consider that when they are reading their "free" newsletter/blogs/emails or know it all Influencer?

 

Yes, if coins of a particular series go up say 10%, the key dates logically do the same. You just net more from 10% of a $10k coin than 10% of a $100 coin. What would happen to change that relationship is an influx of "investors" who only focus on the key dates. Otherwise it's just a "rising tide lifts all boats" scenario.

 

I look at coin collecting as a hobby where I won’t lose too much if I’m careful. If I’m lucky, might even gain adjusted for inflation. I like to do short series that appeal because of history and/or design beauty. One advantage (or disadvantage, depending on point of view) of completing series is that you are forced to acquire the key dates.

Mike

 

Somebody is selling fractional ownership of the mint state pine tree (?) schilling that recently sold for 7-figures.

I don't think you get to keep it in your house, more like when it sells you will get 1/nth of the increase in value.

They had a display at the ANA WFoM.

 

I wish I were a coin guru who can look into the future and see what will be hot or not. Anytime investing in coins comes up I always remember a quote from Q. David Bowers I cut out of Coin World.
"Anytime someone in numismatics says they know what the next sure fire thing will be or tell you something is 100% guaranteed to double in the next year. Hold on to your wallet and run towards the door. " James

 

This made me chuckle. I've been collecting ancients for the past 15 years and have so much joy in learning about the cultures and regions that each coin comes from - I also don't really care if I make a profit with them.

The only thing that really comes to mind is the popularity of coin collecting as a hobby. If there is less money being spent by collectors, dealers will naturally have to be increasingly competitive with what they sell the coins for.

In an ideal world I'd like to find a dealer that knows to set aside a few of the key dates that I'm looking for and I would happily pay greysheet retail for a set number of each month.

 

That’s my home address… but I’m no longer in Maine and live in Virginia. Probably moving to Boston soon.

I don’t have deep pockets at the moment but I can look.

 

I didn't read through most of the answers to your question but the answer is simple.... NO Coins are NOT a safe investment. In fact in the long run it is 99.99% likely you will lose money if you invest in coins, even limiting yourself to key dates does not improve your odds. Simply stated the only people who make a "profit" off a coin collection are the surviving relatives selling it off after the collector has passed.

 

Some G4 dimes have had a 106% return in 10 years and 120% in 5 years.
Hum,

 

Thanks Evan I googled and the same women owned that house foe for 17 years! No store?

 

But how much of that is the run up in silver versus any numismatic value and wouldn't you gotten the same run up if you had invested in 1 oz silver rounds?

Sep 2015 .... $14.52

Sep 2020 .... $23.49

Today .... $43.11

 

I was about to say that all my junk silver dimes have returned a good bit more than that...

 

Key date G4 dime, not silver value but return on investment.
In this particular case my thoughts are that "retired boomers" are back looking at their collection and G4 is affordable to fill a missing spot. Sure there is AG3 but G4 is a good step up and VG10 might be a little to costly. Also the population of G4 is "higher" which makes it easier to trade. You can get all the G4's you want with a good chance, looking at the price history chart, making a good educated investment, the trend is UP.

 

So you're talking about a specific coin the 1916 D Mercury dime. That's a different case.

PCGS price guide, $925 in AG3 (3,924 certified - the most common grade), vs. $1,650 in G4 (2,108 certified).

Truth is a significant number of Boomers are deaccessioning their collections vs. completing them.

Over heard yesterday in fact "I'm 80 years old and I'm selling off my collection."

 

About 50 years ago, I started buying nice quality key dates when I found them. Very few were in high MS grades. Most were XF to AU. It was not a plan to make profit, just wanted to be able to get most of the money back in the future.

Fast forward to the last few years. As I sold my collection, the key dates brought crazy money that offset my loss on most of the common stuff I sold. Not really my plan but I'm happy with the results.

Even in today's times, I believe buying nice key dates is a safe plan for the future.

 

I have never had the discretionary budget to buy key dates. Also, what I have to say does not apply to key dates; they are a market onto themselves. I will share a simple rule about buying and selling coins I have learned.
If you are buying a common date coin. (To me, if you can buy 5 of the same date any day any time it is common.) You will be very lucky if you can recoup 85% of your money. 60% will be more likely.
If you are buying what is considered a "better" date. (To me this is a coin that can be found but may take you a few months to find a nice one.) You are more likely to end up at the break even point. It is just as likely you will make or lose 10%. Just depends on buyers at the time.
If you arer buying truly rare coins. (To me you will often have to wait years to find even one nice example but often times a piece can be located in about a year of searching.) You may reap 2 to 4 fold what you paid if you are willing to wait for the market to recognize the rarity of the piece. You may also end up owning the coin for a decade and get the same break even result. All depends on demand and again how many buyers are interested at the time. James

 

I have never had the discretionary budget to buy key dates. Also, what I have to say does not apply to key dates; they are a market onto themselves. I will share a simple rule about buying and selling coins I have learned.
If you are buying a common date coin. (To me, if you can buy 5 of the same date any day any time it is common.) You will be very lucky if you can recoup 85% of your money. 60% will be more likely.
If you are buying what is considered a "better" date. (To me this is a coin that can be found but may take you a few months to find a nice one.) You are more likely to end up at the break even point. It is just as likely you will make or lose 10%. Just depends on buyers at the time.
If you arer buying truly rare coins. (To me you will often have to wait years to find even one nice example but often times a piece can be located in about a year of searching.) You may reap 2 to 4 fold what you paid if you are willing to wait for the market to recognize the rarity of the piece. You may also end up owning the coin for a decade and get the same break even result. All depends on demand and again how many buyers are interested at the time. James

 

I collect coins for fun. The profits are a byproduct.

Key dates become key dates because they are the scarcest coins in a series. When you buy nothing but those dates you are saying that series collecting, like building a set of Indian Cents, Morgan Dollars or Lincoln Cents is a waste of time. Are you forming a set of key dates, or are you dealing in speculative items where the hobby is left behind?

Years ago I observed that coins whose prices rise beyond the levels which true collectors are willing to pay have become items for speculation. When the market is nothing buy a group of speculators buying and selling among themselves, the merry go round will stop some day. The collectors make the market.

 

As a rule I would strongly advise against collecting any coin as an investment and that applies here as well. There are pitfalls that are impossible to predict and as I have found even being right can be problematical.

This being said key date US coins are a better "investment" than most other coins; ie-less bad. So long as coins are collected there will be smaller supply, and paradoxically, higher demand for such coins.

A lot of the people who do well financially n the hobby are collectors first and foremost. They are people like John J Pittman who taught himself how to recognize value and rarity before those around him could see it. They are collectors who know what many coins are worth and will acquire them for trade when they appear too cheap. They are people who study or otherwise assess rarity or simply happen to collect something before everyone else wants to. There are many ways to profit in the hobby beyond the friendships and contacts and most of them usually demand knowledge and experience.

It's a great hobby in which everyone might profit.

 

@johnmilton. Well said. It is one of my biggest pet peeves. Many "experts" and so called experts will show endless disdane for common date coins. They will exhort collectors to only collect key dates. Common date coins are both part of complete sets AND the affordable gateway to new collectors. Calling them widgets. Looking down on anything with a pop of more than 5 coins and claiming it isn't worth collecting. Most of all. Making the investment side of coin collecting the only factor that counts is the surest way to kill this or any hobby. James