What to invest in

I don't know if the collectors here are (1) kidding, (2) trying to scare away investors, or (3) really don't know about the merits of investing in coins. Of course there are no guarantees in life, but a lot of this depends on the timeframe. Flipping coins every year probably would result in a loss, as suggested due to the bid/ask spread. But I happen to have a Handbook of United States Coins from 1965. At the time the Dow Jones was about 1,000, so it is about 10 times higer now not counting dividends. Bonds and cash equivalents did much worse than the Dow. As an alternative, you could have purchased a 1928 peace dollar in uncirculated condition for $80. Most of the uncirculated morgan dollars are listed between $1.50 and $3.00. Almost all Franklin halves list for $0.50. A 1924 St Gaudens double eagle was $43. The 1916D Mercury dime was a rarity even then, and cost a whopping $105. And so on... Virtually every series shows similar results. I think it would have been virtually impossible to put together any assortment of high grade coins that wouldn't have appreciated substantially. Nobody can predict the future or if history will repeat, but I'm not sure there is much evidence to suggest that "investing" in coins is an inferior choice for a small part of an investment portfolio over long time periods. The trust people place in fee-based investment advisors only makes me smile.

 

Log in or Sign up to hide this ad.

Cloudsweeper you have just stated what I have been trying to say all along. If you are looking for fast money, stay out of coins but if you can enjoy what you are doing and plan for the long haul coins are a very good investment if, (big IF here) you MUST buy wisely or buy intitial issues. Try to avoid the secondary market on modern coins.
Now I will say I would NOT recommend sending ANYONE to a professional for advice. What constitutes a professional? A sign on your desk? A college degree? I would however recommend many of the people right here who have 20, 30 or 40 years under their belt collecting coins. They have been there and done that! It seems there are many who seem to think they need someone else how to make or lose their money? Kind of lends to the national trend of it is someone else's fault isn't it? For Pete's sack take the initiative and do it YOURSELF! Thats what coin collecting is all about. Start the hobby or find a series of coins and go with it. Your best bet is to buy the nicest coins you can afford, be patient and learn to pass up the coins that are way over priced. Eventually you will learn the hobby, you will know the risks and at the same time you will find a whole new enjoyment that has escaped you until then! We would all like to think our collections will increase in value so it is not a far fetched dream but most of us quit worrying about that years ago and set our sights on filling albums or obtaining type sets or those individual coins WE JUST HAVE TO HAVE. Prices and selling will come later, hopefully much later and until that time just enjoy them.

Would like to make one other point concerning these new nickels if I may. Yes, eveyone is hoarding them but many folks have yet to see one. What will have to happen to get those pesky hoarders to put some back on the market? The Peace Medal P is already at the $16 per roll and NO ONE is selling them back in this area. Many coins, especially moderns, will experience spikes in prices and they may not last very long but if you watch the market and your selling price is reached....sell the darn things and if not....just sit back and enjoy them. Sooner or later, if one is patient good things will come your way but NOT OVERNIGHT! Last but not least, I have made far more money in the last 5 years, per money involved, in coins that I have stocks and I did that MYSELF. I have developed a real problem paying out my hard earned money for someone to lose for me! I can do that myself also!

 

On this Independence Day, I'd just like to say that I'm a great believer in independent thinking and a do-it-yourself mentality. Investment advisors who are truly good don't need clients because they can make all the money in the world investing for their own account. The rest are salespersons, whether they work on commission or at an hourly rate. But back to collectibles. Old baseball cards are valuable because everyone's parents threw them out. When people starting putting them away by the case, they ceased to be financially worthwhile to collect. Any coin being saved by the roll by vast numbers of collectors is unlikely to work out well financially, so hopefully the collectors like to look at them. As many knowledgeable people state on this forum over and over, things like key date coins and anything scarce and high quality should outperform the new nickels and state quarters over a long period of time. About the only thing not likely to be financially rewarding in coin collecting is getting caught up in the current popular mania and grossly overpaying for things. Of course, this is only the opinion of an investor with severe numismatic deficiencies -- me.

 

Me...I am betting (and hoping) that Lincolns will continue to soar and really take off in 2009 when the mint will introduce 4 reverses to celebrate the 100th anniversary of the longest running American coin...the Lincoln Cent.

Look at a MS66 Red 1909-P cent. It is worth way more than a MS66 Red 1909 VDB. Key dates like the 14-D, 09S VDB, 22 Plain, etc will continue to rise also.

But that is just me...cause I still love my "pennies". So I am a liitle impartial, but what the heck!

 

I found this answer patronising, maybe its me being british.

 

Is this not a good investment,I have just taken delivery of 50 1966 british threepence peices,they are still in the bank bag and are BU Uncirclated.I paid 10 pence each for them.Krauss value 1.50.
I am not after making millions of pounds from coins,just keeping hold of something that might just return a profit.I come across loads of coins in my quest for my own collection, sometimes buying in bulk which leaves me with extra coins.
Do I bin them or just let them gathers dust in the garden shed, or do i check the values out and put the hopefully good ones to 1 side and save for the future.Just a very simple question, and it has generated all this.

 

Hey... On a positive note, it looks like I went from patronising and disrespectful to just patronising... Give it another week, and we'll be best friends.

 

What are you doing ? You already complained about this in post #20.

Coin collecting, not investing.

 

I thought that since the title of this thread was "What to invest in" that the investment merits and demerits of coins was an acceptable line of discussion for this particular item. Anyway, I don't think anyone here has sought or provided investment advice in the conventional sense as much as casually discussing and guessing which coins we will be kicking ourselves in the future for not buying way back in 2005.

There may be something "impure" about viewing coins as a vehicle to make or preserve wealth instead of something to lovingly collect, preserve and admire as history and art -- but that's just part of the game. The hobby is multi-dimentional, as is the US Mint itself being an institution to produce coinage for circulation in support of economic activity, and a profit center of the federal government. Every coin dealer in the country is trying to make a buck selling coins. It doesn't seem outrageous for the person on the other side of the transaction to attempt to do the same thing.

 

Your problem is...you have to find people that are willing to pay $1.50 each for these coins before your make some $$ on them...that will be the hard part...

Speedy

 

Of course it’s an acceptable line of discussion; we do it all the time. I was answering andyathers question that implied that the forum was only about the investing side. I didn’t mean to imply that it was for the collecting side only.

 

Good luck with that.

I know a dealer that sells BU 1966 Threepences for 20p a piece.

You bought them at a good price but you'll never be able to get rid of them all and the value on them will never go up. You say, well they might be worth 40p each in a decade on the market, yeah but how much will 40p buy you then that 10p buys you now? So you'll probably get your money back. A profit though? Doubtful.

If you want to invest then base metal is not the way to go.

Save your money and buy a 1934 UK Crown the price on those will go up. How do i know this? Well there's 932 of them in existence and i know of one collector that is buying up every example he can find, he hopes to get 100 of them. I think the market is gonna notice that one. The prices have been going up recently.

If i sold off all my coins i could probably just about afford one, but i wouldn't want to, why? because i collect for history and not for profits. That and i think the coin is a pretty dull and boring design all round.

So there you go.

 

I hope to do that someday...I don't know what coin I want to start with but I think once I decide I will try to buy as many as I can....I don't know if I should do it to a common coin or a rarer coin...oh well....I'll find out one day!

Speedy

 

I'd say rarer coins myself Speedy, coins with low mintages.

It's best to pick something a date, a type, a year set collector is going to want.

The best British coin i can think of that would fulfil this criteria is the 1937 sovereign (proof only issue). I think there's about 5501 of them out there. Of which people doing a 1937 year set are going to want. The sovereign type collector is going to want it because it's the only George VI Sovereign issued and the sovereign date collector's going to want one too. And now the investor's gonna want them!

5501, of which 1 of them is in the Royal collection.

That give roughly 5500 of them out there in some state or another.

 

I think there are a few US Proof coins with lower mintages and right now seem low...I might have to wait a few years untill a get a better job...mowing lawns doesn't pay that good...but when I do I would like to work on something like that!!

Speedy

 

I asked the same question to dealers and got remarkably similar answers: Quality, older US coins in the best condition you can afford hold their value best in bear markets and appreciate the most in bull markets. It's the old law of supply and demand. The hundreds of millions of state quarters makes their investment future bleak whereas silver coins prior to 1834, especially 18th century ones, continue their upward climb as fewer and fewer become available. The relationship between gold and silver long ago lost the 15:1 ratio they had when both the intrinsic and stated values of a coin were the same.

Good Luck and most of all, have fun

SMB

 

smb,

The advice you received is very conventional, but tough to support based on the numbers. High quality "investment grade" gold coins rose to great heights, I believe in the mid-to-late 1980s, and subsequently crashed 75% or more (my recollection). Many if not most of them have never returned to those prices even today. There is no reason why the same thing can't happen to older silver coins. So it isn't sufficient to just "buy the good stuff and put it away." Of course some premium is warranted for coins in the best condition, but even this can be taken too far. The trick is to figure out what the definition of "too far" is. It is a great convenience to dealers to have the mass of collectors believe that the correct price to pay is always just a little bit more than the last guy paid. But I think it is just as important to develop an awareness of historical premiums of higher quality over lower quality coins, and to always keep an eye on how bad things can get as well as the profit potential. The best buy may be the coin or series that is least desirable today.

 

Invest In U.S. Mint Items

Try investing in U.S. Mint items which are purchased directly from the U.S. Mint. I have been doing this for about four years and I have had nothing but positive experiences and positive returns. They have relatively affordable items ranging from $8.95 to over a $100. I have invested in proof sets, uncirculated sets, and coin rolls and seen my investments profit exponentially. The items that I purchase run in the range of $8.95 to $35.00 per item.
For example, nickel rolls are good item to start investing with. You can purchase nickel rolls at a small premium and generally once the product is sold out, it rises in value. A set of P and D nickel rolls runs you about $8.95, and if you take a look on ebay right this minute, you will find that the 2004 nickels rolls that are no longer available from the mint have raised quite significantly in price. Try searching for the Peace Medal nickel rolls and the Keelboat nickel rolls on ebay or on the internet. Both items were originally sold through the mint at a price of $8.95 and can now be found reaching prices as high as $100.00! The current market average I have been seeing is about $70 for the Peace Medal Nickel 2 Roll Set and $25 for the Keelboat Nickel 2 Roll Set. Don't take my advice, go ahead and take a look for yourself. U.S. Mint Items can be purchased at the mint website, www.usmint.gov. Good Luck with everything.

 

Or you can go to a bank and get the rolls that have the same coins in them for $2 a roll...the mint charges way to much on every one of their items.

Speedy