Trying to Trade at a Coin Show - Value of the Trade?

After reading the tread about dealers at coin shows,
https://www.cointalk.com/threads/when-your-at-or-working-a-coin-show.305070/
I wanted to relate my recent experence and see what people think.

I have a common date $20 Saint Gaudens that I wanted to trade for a like coin only in a PCGS slab.

Three different long time collectors that have sent a lot of coins in to be graded have looked at the coin and told me that if I did send it in to PCGS that it surelly would grade as an MS63 and perhaps an MS64.

However, at a recent coin show, when I showed the coin to four different dealers at the show, all they would give me, value wise, in trade towards a like slabbed coin was 90 percent of spot.

Does this seem to be fair? I think I should be getting more than 90 percent of spot in trade value for an MS63 gold peice. Or am I out of line?

 

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First, it is not an MS63. That is just someone's opinion. Second, since the coin is raw, you shouldn't expect most dealers to offer what you think is fair.

This is just my opinion.

Chris

 

You should get the coin graded before expecting a trade. The grade opinion you got was from a friend and not a TPG.

 

90 wasn't great but it was fair. Common date double eagles sell for slightly over spot in 63 and that's for PCGS or NGC graded ones. A raw one he would either have to grade or sell for spot if not slightly under since collectors can get graded ones for that price.

Also consider you're trade a raw coin for a PCGS coin. The PCGS coin he could sell a number of different ways where as a raw double eagle most people will only buy those from the big boys if at all.

Final thing to consider is that maybe it is a 63 maybe it's a 58. Plenty of people offer grading opinions that may or may not be in line with the reality of the market

 

As a raw coin, it is definitely no guarantee to be MS 63. However, I would disagree that one should get a coin graded before expecting a trade. In this case grading might add more expensive than potential return.

As far as 90% of melt, that seems low. Apmex is buying random dates that are cleaned at around melt. A fair offer would be melt, give or take 1%-2%.

 

Apmex also has the ability to quickly move product at a rate that 99 percent of sellers do not have

 

I wanted a PCGS $20 peice for my set. I'm putting together a 20th Century Set in all PCGS slabbed coins. What a number of people said that was instead of sending my $20 peice in, becasue of my cost to do so, that it would be better to just do a trade with a dealer. I was figuring that a trade would be my $20 gold plus $100 to $150 in cash for that trade. But what I was finding was that the dealers would only do a trade of my coin and about $300 to $400. It justed seem a bit on the high side to me.

 

True, but Apmex will pay that price to virtually anyone who sells $10,000 or more to them (and often for smaller amounts, especially if they are at a show). A dealer can easily sell to Apmex, so offering 10% under spot for a popular US coin seems quite low to me.

 

In your case I would hold out for a better offer. A spread of $300-$400 is too much in my opinion. 10% under melt is fairly low, but part of a trade, where the dealer has tacked on 10% premium above online prices for their graded example, that is just silly in my view.

Take a look at the ebay deals section as I have seen several instances of common date MS 63 and MS 64 $20 Gold pieces being offered for $90-$140 over melt. And that is credit card pricing (and the last time this happened during a bonus bucks day, so one could get $100 bucks in addition to the credit card rewards).

 

A "number of people" don't seem to understand that 10% is not an acceptable margin for anyone smaller and having a slower inventory turn time than Apmex. No, it wasn't a very generous offer, but quite understandable from a retail standpoint. Which is why suggesting an attempted trade with a dealer makes no sense in the real world.

 

For example, this deal is about $133 over spot (disregard the claim in the listing of $81 over spot as that seller did the math wrong):

https://www.ebay.com/itm/US-Gold-20...-Motto/301503444153?_trkparms=5079:5000006556

If you can find the right buyer, you can make your target of acquiring an MS 63 for about $150 over your current cost.

 

They gave you bad advise than. You can get it graded by PCGS for under a $100 even as a single coin submission. It'd be like 70-85 depending how you shipped it there.

It's even a harder sell trying to trade for the same thing. Normal dealers who aren't behemoths aren't going to trade an easier to sell PCGS for a raw one and without it being worth their effort and time.

It really just sounds like you were given unrealistic expectations by those people unfortunately

 

This is along the lines I was thinking. That in a trade I would get darn close to melt and then $100 to $150 cash to cover the cost of the slabbing and some profit for the dealer.

 

10% is not a large margin, but that is what the coin, and particularly bullion, market works on (and often much less). If a dealer can't make the margins work for them (for example by focusing on quantity or quality where margins are higher), they should not be in the business. Unless they provide something beyond Apmex (besides a bad attitude or mustard stains ), there is little value to the service that they provide in this industry. And we see this daily as more and more of the small guys close down.

 

The offer was fair. He can take it or not but the offer was absolutely fair and better than many dealers would offer. A trade of a raw one for a graded one is literally asking them to trade their more liquid authenticated one with a much bigger market and more selling venues for one that'll have to sell at melt or be sent back in for grading which would take a month.

It's completely unrealistic to expect any dealer to do that for a $100-150 bucks. If one does it they're doing someone a favor for having a long standing relationship

 

When plenty of dealers can't sell anything (and complain about it), I would think jumping at any opportunity to make a profit would be appealing. The difference between a raw UNC and an MS 63 just isn't that much lately. MS 63s were several hundred dollars above raw a few years back but the market has contracted on them. I have seen a difference of as little as $75 between MS 63 and MS/AU Cleaned. So having a spread of $150 would be more than the current market.

You might think that the 10% below melt is fair and I will not. I guess we'll just agree to disagree.

 

It is in how and where you can sell it. At the price you're advocating the dealer is better off selling the one he has and losing out on 50 bucks and a lot of hassle and risk of a fake gold coin that would require having his 1300 tied up for an extra month in grading.

 

You’d do better just getting the one that you have slabbed. The offers of ten percent under spot is pretty standard for common dates, but taking this offer would cost you more than the cost of submission. Can we see this beauty?

 

I really appreciate all the input and views from everyone. It is very helpful.
To mix things up a bit a coin show I'm going to this weekend will have
ANACS onsite for coin submissions. Their grading service is much cheaper than PCGS.
What do you people think would happen if I got my $20 slapped by ANACS then tried to trade over to a similar grade $20, only slabbed by PCGS??

 

Welcome to the real world experience of selling common date gold coins. I know sometimes people state how easy it is, etc but I have a feeling many of the people saying that stuff have never sold a coin. Your experience is fairly typical imo for a coin show experience. In fact it's fairly typical for a coin shop experience as well. Many people over value their coins using inflated price guide values or use the most extreme retail value they can find as their point of value not including dealers margins, etc.

Every time a subject like this comes up I give the same advice given to me early on. Which is don't just buy coins, but sell some coins once in awhile too. I think many people in this hobby might be shell shocked if they attempted to sell their collection when they'd find out what their collection may be worth. But taking that shellacking from time to time makes one a better buyer and buying at the right price is how one makes any money, which is what dealers do.