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<p>[QUOTE=&quot;IdesOfMarch01, post: 1883728, member: 39084&quot;]Let&#039;s say that a seller of, say, a Colosseum sestertius thinks his coin should fetch $150,000 at an auction.&nbsp; If a potential buyer has a total budget of $175,000, then he can only afford a 16.67% buyer&#039;s premium in order to bid $150,000.&nbsp; He&#039;ll drop out of the bidding once it gets over that price.&nbsp; </p><p><br /></p><p>But if the auction house is asking an 18% buyer&#039;s premium, the bidder will drop out at a lower price -- $148,000 or so.&nbsp;&nbsp; So if there are a number of potential buyers in the $175K-maximum-budget-range, all of them will drop out before the coin reaches the seller&#039;s desired $150K selling price.</p><p><br /></p><p>Thus, the higher the auction house&#039;s premium, the fewer buyers there <b><i>may</i></b> be at the seller&#039;s desired price.&nbsp; There will be an inflection point at which sellers no longer work with a certain auction house since the buyer&#039;s premium is so high it reduces the potential number of bidders and decreases the chance of obtaining the seller&#039;s desired price.&nbsp; This is what I mean by self-correcting.[/QUOTE]</p><p><br /></p>

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