Ancient & World Coins - future volatility in price be minimized?

What are your thoughts?

How can the risk of any future volatility in the value of the coins that are part of your collection be minimized?


Coins have been seriously collected for well over 500 years. But to have success in maximizing the financial profitability of the collected coins one must choose an advisor, often a dealer, who has a sharp eye for detail, quality and rarity, and, if necessary, who can help you do research on them.


Quality combined with Rarity helps to minimize your RISK of financial loss in a volatile market.


The creation and development of a collection tends to be a team effort, since no one individual can have the secret formula to invariably identify those coins that perfectly merge quality and art. Of course, fashions in art change, and coins are no different; but some of the artisans of the ancient world whose work appears on coins were so good that their products have been, are, and will be appreciated for millenia to come.


To gain financial returns that exceed many other classes of assets, there is one simple rule: BUY QUALITY COMBINED WITH RARITY.

 

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Well some people collect for financial return and other collect for the joy of it. Some collect to invest some collect to waste.
I have never been a fan of having a dealer pick out my coins or tell me what I should like. I like what I like and it hasn't failed me yet. You should collect what you like and invest in bullion.

 

A-noob and I as well as the bulk of collectors are not nearly as concerned about increase of value as you are. Your investment style of collecting will return a profit only as long as there are increasing numbers of people on the hunt for something to do with large amounts of free cash and nothing else promising better returns. With banks paying fractional percentages on savings and mortgages on homes in regions not seen since the 70's, there are people out there looking for something like coins to fight inflation. If they find something; if banks start begging you for deposits rather than acting like they are doing you a favor taking you money; if the economy takes a swing so stocks are obvious winners --- A-noob and I will be happy to continue buying coins for our hobby as we have been. I do not know who will then buy the sestertii that sell now for $10,000 and up. Perhaps it is fortunate that there are not very many of those super coins. If the coin market today dropped to the level of 50 years ago, I'd buy more and be glad for the opportunity. Would you?

A-noob, great quote:

 

Like any collectable/hobby, there are different objectives - some focus on the history, some art, some quality and eye appeal and some simply want to have the finest specimens - for those who tracked the Lissner collection, the quality was superb. Eric P. Newman - was average yet a broad collection. As the global population expands along with emerging market wealth creation, there should be support for the finite supply of quality coins. Inflation helps (even though we are told there is none) as everything seems to be priced higher. I remind you all that tech stocks were higher in 2000 than they are today and home prices crashed severely from their peak so anything can swing up or down.

To each their own regarding what they collect as long as the journey is enjoyable and educating. There should be no resentment for pursuing the highest quality pricier coins as in Jeff's case as there should be no dismissal of average quality coins. Its a matter of taste and available budget - the more spent on these higher end coins, the more it becomes an investment in part. I personally admire Jeff's lifelong effort and commitment to find and showcase these specimens.

 

I don't want to echo too much what the others have said, but since most of us "collect to waste" we may not be the best to give input on investing in ancient coins. It's been brought up before that if certain collections, of members on CT, were ever liquidated, that it would ruin areas of the market.



Here are two coins of mine (both same type) I bought for the same reason, because I liked them; though I probably wouldn't buy the 2nd one today





For an investment I bought the following ancients, as bullion.

 

hi dougsmit

I have been collecting since 1960, just for the record I did not start collecting from the view of investment but from the beauty and history I saw and connected to the British and Roman coins. I do remember in the early years always liking high quality material. As far as the word investment was concerned I always thought that maybe I could have the hobby then sell as part of my pension plan, your 401. As the years went past the price of the coins I enjoyed and wanted to purchase were the rarer and more expensive items. Some years went past when I did not have the money as making new money was difficult. Today the market has changed and the world has become a world without borders, internet, digital photography +++ and finding choice coins has become more difficult.


The answer is yes I would continue buying at all levels as I understand the rarity of fine quality coins. They are not going to create more.

 

I have been collecting since 1960, just for the record I did not start collecting from the view of investment but from the beauty and history I saw and connected to the British and Roman coins. I do remember in the early years always liking high quality material. As far as the word investment was concerned I always thought that maybe I could have the hobby then sell as part of my pension plan, your 401. As the years went past the price of the coins I enjoyed and wanted to purchase were the rarer and more expensive items. Some years went past when I did not have the money as making new money was difficult. Today the market has changed and the world has become a world without borders, internet, digital photography +++ and finding choice coins has become more difficult.


The answer is yes I would continue buying at all levels as I understand the rarity of fine quality coins. They are not going to create more.

 

But they may find more. For one example, an excellent HOC SIGNO VICTOR ERIS Vetranio AE2 (desirable both as a "rare" emperor and as a historical early Christian type) costs no more now than it did many years ago. Rare he once was, but many very-high grade examples have been found (or, at least, come to market) since the early 1990s.

 

posted this discussion area on face book and having loads of interest
https://www.facebook.com/petitioncrowncoin

 

Oh I go there!

 

Dear Jeff,

Since both of us are frequently chatting aside from this forum, I personally understand very well what you mean. Quality, which is rare, combined with rarity - i.e. an even rarer case. Implicitly, you stress the fact that not even a fraction of the ancient coins come into consideration as investment. Nevertheless, you should explain us what you mean with "the simple rule: BUY QUALITY COMBINED WITH RARITY" using some examples from your own or from my collection. This would give other fellow collectors (apart from me) the chance to better understand your recommendation, which I really appreciate.

Greetings,

Marc Aceton

 

Dear Marc

Quality, is rare whether Roman or World coins and if combined with rarity you are correct these are even rarer.

We are talking about principles of collecting, each individual decides his criteria. Whether Roman or World coins it is only a fraction say 2% which are great quality and we say called ‘investment quality’.

Once again I still repeat "the simple rule: BUY QUALITY COMBINED WITH RARITY". This means from an investment perspective buy only the finest quality you can afford, not quantity but quality and were possible combine it with rarity.

I have spent 50+ years following this rule, in periods were markets are weak quality was still sought by the few that could afford these ‘gems’ as always there are those with money. Usually the ones with ‘real gems’ pushed these in difficult times to the back of the box as they know the real rarity (they do not sell)

 

Dear Jeff,

I appreciate that you clearly mentioned that just a fraction of the coins has "investment quality". Further, I agree with your recommendation but with one note.

Newbies should refrain from spending lots of money in the beginning. Instead, they should learn about the coins of their fields of interest. This will allow them to be able to assess in a later stage what "investment quality" means and to keep the amount of dearly as low as possible.

I recommend for instance inexperienced Roman coin collectors to start first with exposing e.g. inexpensive uncleaned folles or denarii to get a good sense for natural surfaces. Cleaning experience will bring collectors in the position to be able to detect tampered or forged coins and learn about the method of the fraudsters, which is essential when acquiring expensive coins. The more reluctant you are in the beginning the less you are duped in an advanced stage.

Greetings,

Marc

 

My main concern with the "investment" side of it is basically what Doug said earlier. For quite a while ALL major areas of art has shown strong appreciation, basically because of the financial reasons Doug gave. However, there will come a day when returns rebound and possibly the central banks lose control of interest rates. If that happens, There will be a massive bear market for a decade or longer in all things like art, coins, and collectibles that do not generate any current income.

As for "they are not making any more", doesn't that apply to a VF Constantius II bronze, of a F Trajan denarius, just as much as a $100,000 greek? Yes, I agree to buy the best example you can find of a coin, but I find the "they are not making any more" phrase to be as disingenuous as the bullion folks who say, "the value of paper money is going to fall to its innate worth", that is somewhat intentionally misleading.

 

If you are referring to increase in interest rates, then lots of unintended consequences will take place starting with skyrocketing mortgage costs which no one will afford, therefore reducing demand and prices of homes, cars, and anything else financeable - look up the late 1970s in the US where interest was in the mid teens. Growth is slower with high interest rate, unemployment goes up and therefore the rent you will get on a real estate property will be reduced as will the asset itself... now if you have a variable rate on a mortgage, lookout. So technically yes, you can rent out your home to generate income yet its value will be degraded as will be the rent that people will be able to pay. There are many more homes available in a down market than quality coins.

The argument here is not whether to invest in coins vs. other investments, but rather whether to purchase the best quality one can afford for two reasons 1) They look nice 2) They preserve better value compared with lower quality material.

This approach has been proven effective in art, real estate, and other assets whether collectible, income generating or not, quality does better than lower quality. Look at ebay in the recent slowness, prices for lower quality material are dropping far faster as did real estate in the financial crisis while quality material is no longer offered and if it does, it holds its value better.

The undercurrent of the discussion here is a debate about the importance of stressing quality in coin collecting vs. the numismatic/historical aspect. Both can co-exist if mutually appreciated by the forum members rather than being dismissed for other reasons.

 

Well, in regards to coin collecting, what you are advocating then is just buying a few coin versus many, since most people do not have unlimited funds. That might be fine for those who wish to mix investing with their hobby, but I seriously have no desire to ever sell a coin and treat my hobby expense like others treat their golfing expenses, simply lost money. There are thousands of more coins I would like to own, so to say each coin I need to spend thousands for basically means I should find another hobby. Some coins cost me hundreds, a few cost me thousands, but none of that matters to me, it's just an act of allocating hobby money, not investing.

I am all for buying the best example you can find and AFFORD. I simply feel too much attention on quality and value degrades the real reason we collect, that being enjoyment and on CT comraderie. I enjoy posts from everyone here, from AncientJoe to members who can afford to only pay much lesser amounts for coins. Any rich man with a big enough checkbook can buy something, but that does not make them a numismatist. Tons of wonderful reseach is completed each year with coins many elitist collectors would turn their noses up at, heck, every single Sogdian con I own would fall into that category but I love them just as much as others love their $50,000 "rarity", even though 50 just like them exist for each ugly Sogdian bronze in existence.

Sorry, I just dislike coin elitism as I view it as classism. Someone making a fifth of what I make should be able to make as good or better of a collection I have, just as I should be able to make as good of one as someone making a million a year.

 

I appreciate your open remarks and helping me understand the ongoing resentment I sense here with respect to 1) Slabbing 2) Quality.

I started collecting ancients as an extension of my world coins. The SOLE reason I got into this (which was fully disclosed) has been my attraction to design and eye appeal. I do not purchase many coins, or a specific theme. I purchase any ancient that appeals to me in terms of design and aesthetics. I know less about the history or any given series and learn as I go, yet for me this is not the core motivation.

This is not classism or elitism, but rather a different approach to collecting when compared to yours and others, in purchasing far fewer coins, yet being strict on quality/eye appeal. The majority here seems to be into the history/numismatics and broader collecting which I would translate into many coins at lower prices. This also explains the negativity I sensed by most towards slabbing and pursuit of higher quality coins as a threshold. I read every post regardless of coin quality and have not placed a qualitative threshold for responding to posts. I guess the forum comraderie is shared only between the majority who subscribe to the same collecting approach you logically described. As I approach it differently, the forum may not be an optimal fit.

 

I hope you do not feel that way sir. I hope we can both get along with each other here. I sincerely do not wish to drive any participant away from CoinTalk. I come from as you say a love of a history, but have been buying higher end coins as my income has improved. You have come from just an artistic appreciation, but as you say have learned more history as you went. At some point we will meet somewhere in the middle, yes?

Now that you see my motivation, and I know yours, maybe each others posts will make more sense to the other, right? Please stick around, as I feel every participant is important and I love having my perspective on issues challenged, as I believe that is the point of such discussion boards.

 

medoraman - I appreciate your comments. My "rant" is not aimed towards you whatsoever, its a result of months of commentary on the forum on the issue of slabbing and more "expensive" coins. This thread is at the heart of it. If one buys fewer, yet more expensive coins, it does make this more of an investment in a way given the outlay on each piece. I don't know of anyone who buys coin to "invest" but the more you spend, the more it becomes significant.

This is my entire collection of 50 something coins. It will never reach the volume of others yet as described, I focus on the art and eye appeal as a motivation. Its a bit unorthodox, yet that is what got me into this side - https://coins.www.collectors-society.com/wcm/CoinCustomSetView.aspx?s=15432

 

Like I've stated before => dems some sweet ol' coins ya got thar!! (this time I spoke with a pirate accent to give it a bit more ummmpphh!)



... collecting coins is fun (glad to hear that you're enjoying your coin journey!!)

Cheers