collecting strategically - Question re: future "investment" value

Discussion in 'Coin Chat' started by TylerH, Aug 12, 2018.

  1. TylerH

    TylerH Well-Known Member

    Hi All

    Ready to jump in and buy my first coin.

    I have collected a lot of things in my life, and having started "smartly" and "dumbly" before - I wanted to ask.

    Now I realize hobbies aren't "investments" - However I like to at least protect the money I put into something, be it coins, or 80s action figures -

    my question is more about affordable quality - ie: Is it better long term to buy a high grade walking liberty quarter, or a mid grade seated dollar - (for example) if both are the same price.

    Like most things I assume the higher grade / quality stuff generally will hold better value than lower (Thats how it works in toys and comics) but every hobby has its own nuances so just trying to wrap my head around this one.

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  3. physics-fan3.14

    physics-fan3.14 You got any more of them.... prooflikes?

    High grade in coins doesn't necessarily mean high quality.

    You can buy a dull, dipped, unattractive 64 and spend a lot of money, or you can buy an attractive, original, problem free EF-40 example of the same coin and spend a lot less money. I guarantee that the original, attractive coin will hold its value and appreciate more than the unattractive coin. Some series will have a larger market because they are more popular (Walkers will always be more popular than Seated Dollars, to use your example), but if you spend the time to learn the nuances of the series you want to collect, you'll do just fine.

    I realize that coins are a hobby, but when we're talking about spending large sums of money, the investment side of it must be considered. Focus on attractive, eye appealing, original coins and it won't matter what the grade - they will always be desirable.
    longshot, Bert Gedin and Cheech9712 like this.
  4. Randy Abercrombie

    Randy Abercrombie Supporter! Supporter

    Higher grade pieces are generally more desirable. That’s not always true. But until you do gain more knowledge, that is a reasonable basis for making your choice. Not everyone wants to purchase lower grade coins....... and I would caution, I believe that coins are a healthy way to “store” wealth. Not a very reliable way to create wealth. Welcome to a wonderful hobby. Spend some time learning before you spend you money.
    spirityoda and Taurus57 like this.
  5. This is actually an issue that's been bugging me, especially as concerns US coins. From what I've gathered, the collector base for these coins is aging rapidly, thus contributing to a potential increase in effective supply on the market just as demand goes down. All else being equal, this should lead to a lower equilibrium price for a lot of these coins and series, such as Walking Liberty Halves and Mercury Dimes, among others.

    Again, this is just my two cents. I just worry that twenty years from now, there just won't be enough people who collect series by date and mint-mark, making me hesitant to purchase much at this time.
  6. ToughCOINS

    ToughCOINS Dealer Member Moderator

    Fair warning . . . despite your claims to the contrary, I sense that you view coins as a way to make money. It happens, but not as often as you may be convinced that it does.

    Most of us lose money on coins over our lifetimes . . . many dealers included. Why? Because those are the dues we pay to learn the most valuable of lessons. Those lessons are learned long before any profits begin adding up, and they do not come free.

    With that out of the way, high quality has little to to do with grade, and everything to do with the level of appeal a coin brings to the broadest cross section of candidate collectors for that issue . . . that can be difficult to characterize, and can also be a moving target. Take for instance the market vacillations that take place between preferences for white coins and toned coins . . . the market cycles through those trends pretty regularly.

    I suggest that if you want to avoid losing money in coins, you should either do an incredible amount of learning first, or not get involved in coins at all.
  7. physics-fan3.14

    physics-fan3.14 You got any more of them.... prooflikes?

    There has been an article in the coin magazines saying exactly this same thing a couple of times a year since 1900. Still hasn't happened. I wouldn't worry too much.
  8. spirityoda

    spirityoda Coin Junky Supporter

    buy what you love. if you are collecting coins just for an investment you will not get any enjoyment out of your coins. learn as much as you can about coins grading and values. when you go to sell coins to a dealer they will always go down in price because they have to make money on your coin. you usually want a higher grade down the road, but if you can only afford lower grades at least you will be happy with that grade. grades mean different things to different people. you can also save up for a coin. trade for a coin.
    serafino and dwhiz like this.
  9. spirityoda

    spirityoda Coin Junky Supporter

    high grade rare coins you might make money on. it is a gamble.
  10. Kentucky

    Kentucky Supporter! Supporter

    Collect what you enjoy. Do not expect to make money. Be pleasantly surprised if you do.
    serafino, NSP, calcol and 3 others like this.
  11. C-B-D

    C-B-D U.S. Type Coins or death!

    People will always want to buy very high grade, attractive coins.
  12. Kasia

    Kasia Got my learning hat on

    The collector base will always be aging rapidly. Because, although kids do get into the hobby, they generally don't know enough to buy wisely nor do they generally have the $$$. Then many have to grow up, get a trade, earn $$$,a pay to raise kids, etc. So many people truly don't even get into this until they reach age 35 or older. You can't help but age rapidly once you are that far over the hill. Time goes by much, much quicker as you age.
    medoraman and spirityoda like this.
  13. Randy Abercrombie

    Randy Abercrombie Supporter! Supporter

    I appreciate that. I knew I had read this fact somewhere and wanted to say such but couldn’t remember where I had seen it. Coin collecting has changed and morphed in my lifetime to something I couldn’t have imagined forty years ago. But yes it is a hobby alive and well and will continue to be so.
  14. Kentucky

    Kentucky Supporter! Supporter

    Are you saying the other side of the hill is "downhill"? ;)
    Cheech9712 and spirityoda like this.
  15. TheFinn

    TheFinn Well-Known Member

    Yes, date collecting is going the way of roll collecting. The value will always be in the key dates, and nicer coins. The only thing I collect by date are the Austria Niobium-Silver 25 Euros. I buy about 50% U.S., and those are just nice coins with great eye appeal. Everyone collects in a different way, and with a different plan. Seated Dollars are usually only collected by type because of the cost, but if you have the funds and patience, you will make a bit of money or break even.
    longshot likes this.
  16. Kasia

    Kasia Got my learning hat on

    One thing you can do easily is start looking at pricing... in the red book, in mags or papers and also invest in a blue book. Because knowing or being able go look up the blue book price and then the 'retail' can give you some good info on what some dealer *might* pay you if you were selling and also what they might have paid for it (to some degree, still need to 'guess' if you don't know the dealer). Look up what is selling and what for on ebay. If you are with a series that is normally, over the past number of years at it's high point, then perhaps that is not the time to get into it. Realize that any time you get into coins, some selling mode may make things less than they were before so that people owning the coins may be 'forced' (because they cannot afford to keep it) to sell, and others may simply wait things out.

    Today I went to a coin show, and I took my blue book along. For the few coins I bought, I first looked up the 'value' in it, then looked at another pricing source.

    When either deciding to purchase (or not) or asking the dealer's best price (when I did) I at least had a range to consider if I was not super familiar with the price range.
  17. ewomack

    ewomack Senior Member

    Everyone wants to protect their investments, of course, but if you don't buy things that you enjoy then this hobby will become intolerably boring very quickly. Bullion, though also infused with traps and dangers, arguably makes for a better investment than collectible coins. Gold tends to hold its value, with inevitable peaks and troughs, and so do many numismatic pieces, but gold plays a much larger role in the world economy than a nice Liberty Seated Quarter or a shiny 18th century Copper ever will. Not only that, as tangible money slowly becomes electronic the general interest in coins will likely diminish. It probably won't disappear altogether, but many collectors from prior generations entered the hobby through romancing pocket change. Once that gateway vanishes, collectible coin values could tumble. Obviously no one knows exactly when tangible money will vanish, if it ever does, but this has become a feasible risk for people seeking to invest in numismatics. If the number of collectors shrinks (and I've heard various opinions, but the consensus seems to point towards a general shrinking of the hobby), then values will also shrink. To decrease this risk, I buy exclusively what I like, though I've also prepared myself that most of the pieces I've purchased may end up losing considerable value over the coming decades. By keeping my spending down and acquiring only what I really truly want I at least obtain enjoyment and keep losses as low as possible. Be careful out there.
  18. Kasia

    Kasia Got my learning hat on

    The other side of the hill starts when you reach your 30th b-day. No, you might have some of your best years coming later.
    spirityoda and Kentucky like this.
  19. COCollector

    COCollector Well-Known Member

    Research before you make a first buy.
  20. ToughCOINS

    ToughCOINS Dealer Member Moderator

    And research before you go over the hill too . . . if you have the time. Some of us didn't do that first :banghead: :banghead: :banghead:
    spirityoda and dwhiz like this.
  21. myownprivy

    myownprivy Well-Known Member

    I like to collect things that give me both pleasure and an ability to potentially make money (or at least not lose money). I think you can safely assume that buying gold and silver can meet those criteria.

    Again, personally, I completely skip graded items. Although observation tells me that highly graded items give the potential to make money while average graded items do not. However, I generally skip numismatic value when buying gold and silver completely, because numismatic value changes so much and I don't want to risk losing money. The "collecting" aspect of gold and silver for me is that in addition to the low premium full ounce gold I buy for savings, I am willing to pay a small premium for a variety of 1/10 oz gold to collect or 1 oz silver. This includes new bullion pieces and older stuff, like 2.5 Pesos, Francs, etc., or buying one of each time of 1 oz silver bullion.

    I think you can collect coins without risking money. But as others have said, it will probably limit your collection.

    There are also lots on ebay of 10, 25, 50 slabbed, graded coins in grab bag lots. You can purchase these for almost nothing per coin. That might be a fun way to cheaply start collecting. Maybe you'll get something you'll really like?
    Last edited: Aug 12, 2018
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