I just bought this 1909s $5 Indian in XF40 for $455. http://www.ebay.com/itm/1909-S-G-5-...469188?hash=item2a681eb484:g:EvYAAOSwZetXO0Zn I really like the design, and I've been eyballing them for a couple months. My awesome LCS tells me that MS62+ is the way to go, but this was a tougher date, it looked good and it seemed WAY underpriced. Between greysheet, PCGS, Numismedia etc. I came to the conclusion that this coin should go for about $535 retail. Problem is, I can't find any history on auctions for this over the last year. I enjoy the hobby immensely. I am putting together a set of Barber halves in fine (well over half done) and like nice looking seated and bust halves as well. I buy quite a bit of 90% "junk" US silver coins for bullion and the occasional modern gold eagle. I said all this to ask - is there room in the hobby to go for a balance between numismatic and bullion value? Is it better to either buy a coin only for it's rarity, or only it's bullion value? I ask because this has to be a consideration for me. This is part of my retirement plan so I plan on selling one day, but in the meantime, it's a very interesting hobby. "Hobvesting" if you will. I have to take this into consideration because it's my wife's money too and she doesn't necessarily understand when I spend $20 on a Lincoln cent for my collection, but she has seen me profit so she has given me more wings lately.
First, there's no reason for you to have to expend effort looking all around for auction results: http://www.pcgs.com/auctionprices/default.aspx Forgive me for phrasing it this way, but it's foolish to use "coins" and "retirement" in the same sentence. If you devote maybe 20% of your actual retirement/investing activity into rare coins, it might be worthwhile as long as you're only worried about your money not shrinking. Coins are far too subjective a commodity to offer any sort of "expectation" as to long-term viability; you don't even get to know how wise any given buyer was to offer the price they did, and that Ebay VF25 is proof that there are some real dunces throwing money at coins. Profit when reselling coins is predicated upon finding the buyer willing to pay you a profitable return. What if the economy is down when you choose to sell, and people are being cautious with their money? What if you choose the wrong venue, and nobody who wants that coin is looking that week? What if somebody perfects a material which duplicates the electrical advantages of gold for less money, and the (majority) of current gold demand (which is industrial) falls away with the subsequent (huge) drop in bullion value so that only numismatists are buying coins any longer? Profiting from coins is as much a matter of luck as anything else. Yes, a savvy investor can skew the chances of that luck in their favor, but all the same it's not a term which should appear in your retirement goals. The only reasonable expectation from coin "investing" is to have a decent place to "park" money, when you have enough of it that rate of return isn't a priority. Even then, you can only park that money in issues whose market demographic is recession-proof. Junk silver and Fine Barber Halves don't get you there. Neither does this $5; the demographic you need is buying them in Mint State. Of the 571 examples of 1909-S which PCGS has slabbed, 504 of them are graded higher than the coin you just purchased. That's why so few auction records exist.
As far as coins for retirement is fine as long as you by right and don't expect a large gain in value. I chuckle at some when they get all giddy on the increase in value on a coin, but don't take in the factor of inflation when in reality they lost money. Now don't get me wrong I have coins set aside for retirement but only to subsidize it (parked money) that I can sell 1 or 2 a month for extra play $ if desired. Numismatic value over bullion, because if bullion prices fall numismatic price don't fall as far. Question though is why would you spend $455 on ebay for that coin when you could of bought it of Gary's website for 30-40 cheaper?
Forgive my phrasing also. I used "investments" instead of "savings" in some cases. It's only a portion of my savings, so yes I agree that it would be foolish to put a majority chunk of savings there. I already turn a small profit, so the "investing" portion would be to develop more in the dealer aspects, while also parking some "savings". The issue seems to be balancing a business with collecting, and indeed it may be futile.
Fair enough. I know enough people who buy/sell coins at a consistent profit - I used to be one - to know the ability exists; it's just a matter of acquiring the necessary skill and knowledge to buy the right coins at the right price. KoinJester's remark above - the fact that dealers with an Ebay presence sell the same coins for cheaper on their own websites - is one of those pieces of knowledge. http://www.ebay.com/itm/1910-S-G-10...149785?hash=item25bc5f4399:g:slYAAOSw41xXO0ZJ http://www.coinbuys.com/products/1910-s-g-10-indian-head-ten-dollar-gold-8867-53-80806169-au53-pcgs
I did look and do see similar coins now a bit cheaper on his website. He would charge $10 shipping and I would not get the $10 ebay credit so it would cost me $20 above and beyond what is on his website, so I'm basically paying an extra $10 or so for eBay protection. Plus, this now goes into auction records at this price.
$535 will buy you an AU50 coin. CDN bid is $400, so you paid a fair price for this coin. You will not be able to make a profit on this coin today. Keep in mind that most of these better date Ind. gold pieces will fetch < greysheet bid.
Yeah, none of the numbers we're talking about are exactly backbreakers, and you're plainly doing some homework here.
Good advice here and worth heeding. But I would add that your choice of a mix of junk silver and neumismatic coins could very well turn a decent profit. No one knows with any certainty what the future will bring. Do yourself a favor and invest in what you feel comfortable with.
No, < CDN bid. Most of the better and rare dated MS Inds. sold for under CDN bid at the CSN Heritage auction last month.
Oh, now I understand the basis for your statement. Of course, you're referring to just one data point. It's not at all unusual for buyers to flock to common date material when gold is on the move, as common dates are more volatile, and tend to make more for investors with the swings in spot. For that reason, many dealers overlook better date material during such periods, whether they do so consciously or not. They are just buying what they think they can sell most profitably.
