Prices for 1877 IHC's seem to have taken a dive lately.......

Was looking at Ebay completed prices out of curiosity this morning and noticed these are currently going for (a lot?) less than 5-10 years ago?

(Good thing I got my humble low grade example quite cheap...)

 

Log in or Sign up to hide this ad.

I think the general consensus is that overall, average prices for everything are lowering. Especially compared to 5-10 years ago, there seems to be weakness in many segments of the coin market.

 

How many people are starting circulated IHC collections today versus being sold? I have always thought the modern keys like this and 09S VDB were in danger of overall slowdown.

Too many people collected "keys" only, arguing they were a completely different market. I always thought their value was tied to underlying collector demand to complete sets, and as such the keys got massively overvalued the last 20 years.

 

Yes prices are dropping in the coin market. At least coins have not gone the way stamps did.

 

Rick Snow published a lot of interesting information on the 1877 a few years ago. He was showing how the services have been grading these higher than they did in the past. I wonder if that has something to do with the pricing in todays market?

Prices have been going down for many years. Not much fun to watch.

 

Is this weakness a buying opportunity or is it trying to catch a falling knife?

 

I haven't been studying the market, but my intuition tells me "long-term trend" rather than "dip".

The Internet (eBay et al) is making it easier to find or sell examples without a dealer taking a cut, which is probably bringing more coins out of the woodwork.

The same Internet makes it easy to find and buy ever-more-convincing fakes, which decreases trust in raw coins. This decreases the price at which raw coins trade, and while I can't prove it, I suspect that this drags down the price of slabbed examples as well.

I don't see either of these trends reversing, and I don't see a new surge of demand to drive prices up.

 

Markets go in cycles. Sometimes its up, sometimes its up for a long time, sometimes its down. I'm treating it as a buying opportunity.

 

You are right but be careful. I knew many who treated classic commemoratives as a dip, and are still massively underwater.

Do you like the coins? Does collecting them give you enjoyment? Then any price can be the "right" price. However, speculation is a dangerous game in any collectibles field. Sure, use it as an opportunity to buy a coin you couldn't afford before, but use hobby money, not investing money IMHO.

 

One of the things that NGC's value guide has is a historical chart of price performance in each grade. If you click on the value, it shows a chart of trends. For all 1877 IHC in circulated grades, values peaked in 2010 and have trended mostly down since then: https://www.ngccoin.com/coin-explorer/indian-cents-1859-1909-pscid-17/1877-1c-msbn-coinid-12127

 

Quote from @Jack D. Young :
"Eduard, is this for all grades or in general? The large cent variety market has certainly gone down recently, maybe influenced by a focus on higher grade examples for PCGS type sets and Red Book focus away from some of the more obscure varieties."

That is a good question, Jack. I really do not know the answer, but most people seem to think it is across the board. This seems to include Colonials as well, if I am to judge by what I have seen with recent prices for late Colonial rarities.

What struck me is that about 10 years ago I had valued my 1877 at about $900 (if I remember correctly), whereas lately 1877's in about this grade seem to bring about 60% of that.

 

IMO as the older generation passes into collectors heaven, their collections are being sold, without enough youngsters to take up the slack. But to many of us this is not about return on investment, just the enjoyment of the hobby.

 

I am a biased respondent, however I will give a long reply. I believe collectors should treat this down swing as an opportunity to purchase what they are interested in at more attractive prices. Investors should probably take their losses and leave the market.

This hobby has been somewhat spoiled by investment mentality, and many collectors have been fortunate enough to take sizable profits when they've sold. Many others have had the good fortune to break even. Seeing this repeatedly has convinced a large number of collectors that they should expect to make a buck or at least break even when they sell. This is a mistake.

People should collect coins for enjoyment with profit or a store of value being far down the list of reasons why one does so. If someone is purchasing coins to make money, they're probably going to be disappointed. If a collector is worried about purchasing a coin for fear that a financial loss will result later, they should save themselves the disappointment and keep the $ in their pocket.

I get asked far too often if a coin someone is considering is a "good investment" and my answer is always the same no matter what it is or how much it costs. "No." I hate to think that numismatics will go the way of stamps, but IMHO the odds are more likely than not. Not enough new collectors are replacing the old, and our hobby is only one of many that are following the same trend. I think expecting a recovery to the good old days is wishful thinking. That doesn't mean we shouldn't buy coins though, but we should buy them for the right reasons.

Two stories:

1) A very intelligent man who had recently retired from a major financial firm bought a handful of four to five figure coins out of auction and told me he would be doubling up on them in a couple months. The sellers were "fools" to have sold them at the prices they did. After he sold them he'd be reinvesting it all into coins and doing the same. He reasoned, with this strategy he'd be a full time coin dealer in a year or two and have an inventory of a million or so. You can easily guess that he never bought coins from us again. I saw him at a coin show a few months thereafter and asked him how he was doing. He didn't want to talk about his progress. I haven't seen him since. While his dreams may have been grandiose, he was well educated and was buying thoughtfully. His major error was buying coins for the wrong purpose to begin with.

2) A sickening number of clients and surviving spouses are flabbergasted by the worth of their coins now that the time to sell or auction has come. For years they assumed their assets were rising in value. Trusting wives eagerly accepted their husband's assurances that his collection was at the very least a secure savings account. Infrequently they get lucky. Most of the time they have to accept the dismal truth, and sometimes this financial shock greatly impacts the rest of their lives. Being the guy to talk to a devastated spouse that thinks she has $800,000 for retirement when she really has $80,000 is not an enjoyable experience.

We collectors are at fault for lying to ourselves and our families that coins are a good way to save/invest. Granted, there are worse ways to spend money, and we will probably recoup a good portion of what we put in, but this (or any other) hobby should not be your retirement plan or savings account. Be honest with yourself and your loved ones about the value of what you own.

With all that doom and gloom behind me, I will say I personally have made some great scores in numismatics and most of us have stories where we've done well. I don't think those are the stories that should be celebrated first though. Better are the ones where we made friends, gained knowledge, hit a personal goal, etc.

Collectors should look upon the downward trend with eager eyes. We want to grow our collections with bigger and better, and now is our opportunity to do so, but certainly not with investment (or even savings) in mind.

 

If coins ever go the way of stamps, it will be a day of suffering and misery.
I was just recently stopped in a B&M stamp shop to look around. The owner was selling packages of unused stamps (1940’s-1970’s) $100.00 face value for only $64.00 a package.
He every week he buys 3 to 6 “inheritance collections”. He said the heirs often get very upset to the low price he offers them, but he explains they hobby is on life support, hardly anyone collects stamps like they used to.
It reminded me of the current prices for Mints and Proof sets......down, down, down.

 

I have long felt that coins were a fine way to “store” wealth. If I have a twenty in my wallet in the morning, it will likely be gone by evening. If I use that twenty to buy a couple nice Franklin halves then that will stay with me a while. Never ever is an investment though.

As crazy as this may sound, I am happy to see coin prices in a state of correction. I have long felt that my generation has vastly inflated the value of coins making many of them out of reach for the average collector. If this hobby can become more affordable, then we would see a whole new level of interest take place.

 

That's why you need to watch the premium you pay to face value and/or intrinsic (bullion) value.

The most popular coins might be the ones where the number of collectors drops off LEAST. That includes more expensive coins such as Saints and/or Morgans.

 

Any coins selling for huge premiums -- like the Morgans and Saints, circa 1989-90 -- are subject to a 50-75% (or more !! ) decline as the air comes out of the bubble.

Niche sectors like Indian Head Cents or rare pennies or nickels bid up by collectors because of the need to finish a particular set or just demand for that coin are particularly susceptible to declines.

 

Hey. Your getting a best answer

 

Yeah but why would a 1877 drop. We all want one. I can't afford one at any price. But i still want that year