Coin investing, keep the flaming down!

Have to strongly disagree with you there. Guess it depends on what you're looking at. More people can afford to buy a $200 coin than a $10,000 coin right now so I suppose the 10k example might be losing ground these days.

The charts in coinage show that the bottom has dropped out of their sample MS65 market since last year while the VF sample market is steady.

 

Log in or Sign up to hide this ad.

Remind me to dump everything on Ebay if we get another spike like that. It doesn't not have to be at the exact top but in that neighborhood.

 

I am perfectly willing to let others pursue coins as an investment vehicle, I choose not to. My collection is a hobby, although some friends refer to it as an addiction. :smile

Having sold sets of nickels through dollars early this year I did realize a profit over my incurred purchase price, but probably not including inflation, storage, and other related costs. All I did with the proceeds is to move into other coin series that interested me.

For investment, I used more traditional vehicles, 401's, savings plans, etc. Stocks?, no, not since 2005. The last two years have been trying to investors but I have seen growth well above inflation. Good professional advice on investing is out there, and worth it, in my opinion.

 

I collect coins with the knowledge that they will likely increase in value over time.
BUT not at an investment-level increase.
And through a combination of luck and fiscal frustration I managed to avoid the two peaks in the chart.
The 1980 peak blew me out of the market and I didn't re-enter until after the 1990 peak.

Since I didn't start keeping records until about 10 years ago most of increase in value of my collection is unknown.
I DO know that a few of my keys/semi-keys did move up well.
I believe I got all these coins before 1980.
My 1893-S Morgan bought as a VG (ended up slabbing as a G-6) cost me $750. Still have it.
My first 1916-D Mercury (raw AG) cost me $70. Sold for about $200.
My first 1909-S VDB (raw AU Details) cost me $205. Sold for about $800.
And the list goes on for a few more coins (unfortunately the memories don't).

The point is coins that might get close to investment level are the keys/semi-keys.
I do NOT expect my set of MS-66 silver Roosevelts to perform anywhere near that well. At least not in my lifetime.

 

Naturally no one really wants to make a bad investment but as you said, it's a hobby. Note all those charts? They really mean nothing if you are here for a hobby. The price you pay and/or what it is worth for a coin is really meaningless if you just enjoy this hobby as a hobby and great passtime. Also, something nice to pass on to others after we are gone and hopefully they too will pass them on as a family tradition. Any monitary gains in your coins values are then really meaningless.
I've got some really old cars in really nice shape and people always ask how much are the worth. I tell them 0, don't know, don't care, since I'm not selling them so they are just only worth how much I like them.
Ever see those people with model planes for flying. Some cost hundreds and even thousands of dollars and some just crash. Brings tears to thier eyes but those people come back over and over too. It is a HOBBY. If you constantly worry about charts of values, prices in the Red Book, The PCGS price guides, people on coin forums that constantly say of no real value, could lead to ulcers.
I've been collecting coins for well over 60 years now and I now really don't care about coin values. Too little time left to worry about a bad investment.

 

Needless to say, whether it is a hobby or not, it still hurts when you go to sell a coin that you paid big bucks for and is now worth a fraction of what you paid. I don't plan on owning my coins forever. While I am here on this planet, I collect for the pure joy of collecting, but eventually someone will be the beneficiary of my collection and it would nice to know that what I have collected is worth more than what I paid.

Just take that poor soul that was mentioned in a recent article in Coin World who bought a very rare us coin for about $250,000 then turned around a few years later and sold it for half. Now if you are spending that kind of money on coins, chances are maybe $125k loss wont hurt, but it is a loss nonetheless. What we don't know is whether the auction company guarenteed him the amount that he paid, so maybe they were the ones who took the loss.

As many others have said, it is best to collect for the joy of the hobby...make wise choices and collect what you like and you should be ok.

 

If it ain't fun .... don't do it!

The pitfall of collecting for investment is that in order to be successful knowledge which can only be gained by much experience is necessary. ​

I am offering nothing here which is new, earth shattering, or even particularly thoughtful. Remember, if everyone seems to say almost the same thing ... then it is probably true.

If you enjoy what you collect then there is no down side. Further you will probably end up to the good side if you aim to collect for quality. Earlier in my time I collected for rarity picking up pieces which were unique or almost so. I have quite a few die trials in Lead from a private mint. For instance a CNA (Canadian Numismatic Association) convention medal of which there is recorded as only two struck. I have enjoyed owning that even though I do not have a high value piece. I have had the honour of owning something rare however, and hope to pass it on to someone else who also enjoys collecting Medallions. ​

The old saying "No Pain, No Gain" applies here. Instant experience does not exist, no matter how you say it. So if you have invested the time and energy of gaining as much knowledge about a topic that would qualify you as a recognized authority, then go ahead and invest. There are great returns to be made.

 

okay, then I have nothing to say.

Sheesh, ya take all the fun out of posting.

 

a friend of a friend.....

A friend of a friend asked me to look at his investment coins which he purchased back in 1988-89. They were all neatly sealed in soft plastic flips with very official looking labels stating that each coin graded MS65. They were all common date generic Morgans & Saints in "about MS65". This guy had paid more than $1000 each for raw common date MS65 Morgans that nobody wants today. The guy that took his money diversified the collection by adding a PF V-nickel, an MS barber dime, and a couple early Washington quarters. The nickel was worth about $450 and the dime was worth about $200 in today’s market. The Washington quarters are probably worth $50 each today. He couldn’t remember what he paid for these minor coins in 1989 but it was much (much) more. It will be a very long time before he recoups his investment which was tens of thousands of dollars in 1989.

I gave him my grading opinion & let him review my grey sheet. He ended up sending all the coins to NGC and essentially got the grades we told him to expect. I understand that one of the Saints that I graded 65 came back 66. It is a pretty coin but it is a generic coin & he will never get his money back.

 

I'm not going to say that a few people won't make money on coins as investments, but as a whole it's simply not going to happen. Being the oldest hobby in human history, if coin investing was a solid form of investment there wouldn't be this constant debate, it would be fact. But, seeing as the billions who have collected over time have not become wise investment gurus and multi-trillionaires, says it all...you might as well have taken your money to Vegas.

Collect for the fun....thats the greatest investment a coin can offer 100% of the time.
Guy~

 

So what is the casual reader supposed to get from this thread? When does everyone here feel it's safe to go back to a coin show? Ever again?

If these charts are the holy grail than everything should already be much lower than last year. (Although I couldn't list anything I've seen as a meaningful comparison.) If PCGS' charts start moving back upward again, you won't want to buy then either because now prices are going up! So when is it safe to buy?!

It's too much crap to worry about. I collect what I want and can afford. I'm not buying 10s of thousands of dollars worth of stuff, which would be far more room for movement than the average collector on this board would have to worry about. We've proven that investing huge amounts in coins is risky if you're worried about it.

Though you would think we're much nearer to a low point right now than we are near the high point of 89. What do you guys realistically expect to happen? Should we wait to buy a MS65 Morgan until the numismatic premiums have dropped to slightly above melt?! $150 is a total rip off now? I don't own any MS65s but I'm just curious? Should we wait for $50?? $40?? At some point you hit rock bottom and people aren't just going to give stuff away.

The biggest concern I see is the possibility of unknown hoards being found that dump new examples into what once were rare or scarce markets. Which happens from time to time.

 

paging Danr... paging Danr... this is your wake-up call! repeat... this is your wake-up call!

We are currently experiencing a spike... in gold. You might want to dump all of your gold on eBay.

no one knows where a market will eventually top, but if it looks like it's really high, then it's time to get out. this is not to say that it won't go higher, but chances are that sooner rather than later, it will be going back down.

and as an aside to Doug's charts:


this type of drop in the charts posted is exactly the type of buying opportunity that presents itself once in a blue moon. I think that the fact that people are not buying coins is the reason for the lower prices, (supply and demand) but when the economy picks back up people will once again be able to afford collector coins and the market prices will rise making for a nice profit for those who can afford to buy now and sit on it.

It's curious if you ask me that the economy is currently affecting two markets in the exact opposite directions. The gold price is being driven up and the price of collector coins is being pressed down. Both IMHO because money is tight and people aren't buying.

 

When is it safe to go to a coin show? Why when there is one of course. Don't know about others but I go to about 2 to 4 coin shows a Month now.
Should we wait for a coin to drop to the lowest price? Why? If I want a coin, need a coin, like that coin too, I really am not about to wait and see if the price ever goes down. So what if it does? Don't know about all the others but as I keep saying this is a hobby. And as noted one of the oldest ones. I'm way to old to care about values tomorrow. At my age I just care that there is a tomorrow. If you keep wondering about coin values, you may never purchase another coin since it may be cheaper tomorrow. Ane even cheaper the next day. Like I said, I worry more about there being a tomorrow than coin prices.
AND too if your not selling coins, what difference does it make what they are worth?????????

 

Regardless whether people sell their coins or hold them until their demise it is human nature to want to believe that what you paid $X for a year ago is now worth $X+1 today. I think that it just makes people feel better about their judgment, their evaluation skills, and sometimes even themselves in general. People want to think that they spent their money well whether or not they intend to sell the item at any point in the future.

 

Good story but what does this prove? This is just yet another example of a completely uneducated investor looking to dump money into an over-hyped market who was taken advantage of. He trusted the salesman knew what they were talking about. No different than the mortgage bubble.

I know a friend of a friend who had a paid off home and 400k cash in the bank a few years ago and decided to dive into the booming housing market. Got greedy. Decided to invest the money into a second house and rent it out. Now he can't sell either house, the money's gone and his assets are down several hundred thousand. The housing market in that state has collapsed.
That's what happens when people overly trust other people and want to get creative, without being aware of the full facts before diving in. What we've experienced has probably changed a generation.

But is today's coin market-overly hyped when you can buy those same Morgans for $150 or less? Or the quarters for $50 a piece? I mean, what's reasonable? How low should these fall before it would be safe to buy them without losing your shirt? And would it be enough loss for anyone to care at this poin? We're a long way from 1989 using dollars that aren't worth as much as they were then. I suspect if we saw the same vertical spike today as there was then, most people would be suspicious and back off.

The thing is, despite this supposedly falling market, you can contact any seller on ebay, tell them about this falling market and say "you want to play it safe. You'll buy their coin now for 10-20% off their price because the market is falling."

Then they'll tell you to get screwed. It's not happening.

Forget that! Do a test. Try negotiating $10 off. I've tried it. It might work 50% of the time. Just because one or two people think a coin is over priced doesn't mean a seller is going to drop their price to accomodate them. If you think it's over-priced, than you simply won't be buying it. I don't know that that would prove anything.

 

LOL!! Right on, Carl, I like that answer the best. Live for the day and quit worrying so much about tomorrow.
Guy~

 

great attitude when you're 65 or 70, cole, but a lousy one if you're under 30

 

You have tohave a time frame to go with that. In 1963 the SVDB in Good was $125 dolars. In 1988 twenty five years later it was $245. That is about a 2.5% per annum return on investement. Less than the so called rate of inflation and much less than the real rate of inflation during that period. Yes it has done better since then but if you go back to when it was $100 tlll the $1500 figure the time span is long enough the the annual ROI is still nothing to get excited about.

A few years back someone made the comment about the GSA doar that he wished he had bought up a whole bunch of them back in 72 when they were sold, I sad that woudn't have been good because the GSA dolar were sofat for so long that if he had bought them in 72 his ROI would have been roughly 1% per annum. But that if he et others hold them and had bought them up heavily ust two years before the time of his comment his ROI would have been over 200% per annum. And since that time they have once again remained pretty flat so if you missed the boat and didn't buy them at just the right time once again your ROI is not looking good.

By mid 1968 the silver coins were heading toward twice their face value in metal value. Most of the siver in circulation had already been siphoned off and it would have toaken so work to get a bag out of circulation. If you bought a bag it would have probaby cost you close to $1750. At todays price your ROI would be about 5%, a little better than the official inflation rate and probably a little worse than the real rate. You would have done much better to have sold after just ten years, locked in a 26% ROI, and invested in something else. Holding after a peak just erodes your return. The problem is identifying the peak.

 

That's pretty much the way I feel about it but some are concerned that the price drop involved with buying coins is the equivalent to buying a new car.

Mike, I agree. With supposedly that far of a drop, buying opportunities should abound! When nobody else is buying, that's when YOU want to be buying!
Instead, there's always a few who want to say you're trying to 'catch a falling knife'. As if we should wait for their divine advice to tell us when the valley will hit so we can buy up everything in that 'one week window' before the market starts climbing again! At which point we'll be told you don't want to be buying (again) because 'prices are going up', 'you're buying into all the hype', 'it's going to crash next fall'..and on and on.

I agree, if you're not looking for a quick flip, who cares? Trying to win anything from an investment standpoint, frankly sucks.

That's why this is a hobby for most, while values will fluctuate both ways as the years go on. The dollar values have very little meaning to me. Which also means I'd have to be offered more than most things are worth to get me to sell anything. And even then maybe I still wouldn't. Then you wonder how many people probably feel the same?