Coins as Investment: Good Idea or Bad?

Discussion in 'Coin Chat' started by rrholdout, Aug 30, 2017.

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  1. harrync

    harrync Well-Known Member

    I think you are mostly right in today's market - billionaires will pay big bucks for "trophys" - coins [or banknotes] where you can tell your billionaire friends "I have one and you don't." I started collecting/investing back in the 1950's, and let's just say I did pretty well buying and selling in the $100 to $500 range [probably would be $1000 to $5000 today.] And I might note that some of the biggest profits I made were items I "overpaid" for. Today, I don't think there is much potential for profit in these mid-range items; I only buy the item if I really want to have it, not expecting any profit, but figuring there won't be that big a loss when I sell [unlike, say, Bennie Babies.] Maybe if the plutocrats allow the middle class to make a comeback, there will be profits in mid-range coins and banknotes; other than that, forget any hope of profit, unless you "stole" the item when you bought it.
     
    harrync, Sep 1, 2017
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  3. GDJMSP

    GDJMSP Numismatist Moderator

    I was probably the first person on this forum to ever post that collecting coins as an investment was a very bad idea. It always has been and it always will be. History has proven time and time again that 95% or more of collectors lose money when their collections are sold.

    And it doesn't have a whole lot to do with how knowledgeable you are about coins either. Sure, it helps, but you can be very knowledgeable and still lose money.

    That said, you can make money, show a profit, on your collection. But to do so you have to do 5 things right. And you must do all 5 of them right, get even 1 wrong and you will lose money. These are the 5 things -

    1 - buy the right coin
    2 - buy at the right price
    3 - buy at the right time
    4 - sell at the right price
    5 - sell at the right time

    It's a short list and seems to be quite simple and easily accomplished. But I can assure you it is not. And the fact that it is not is borne out by the results that history has shown us over and over and over again.

    There is only one reason that one should collect coins, because you like them. Do it for any other reason and you will almost certainly be disappointed.
     
    GDJMSP, Sep 2, 2017
    #42 + Quote Reply
    green18 likes this.
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