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Buy the Best You Can Afford

DisneyFanDisneyFan Posts: 2,064 ✭✭✭✭✭

Jeff Garrett recently wrote a column along the lines of “Buy the best you can afford.” and went on to say history has shown that over time, the highest-quality coins have performed best in terms of price appreciation. This has been especially true in recent years with the insatiable demand for coins as part of set-registry programs.

Then he mentioned Q. David Bowers would espouse the wisdom of buying the “spread coins” for each series. Those are the ones that skyrocket from one grade to the next. Why pay $25,000 for a MS 65 1925-S Peace Dollar when a MS 64 is only $500, and you can barely tell the difference?

Are these two viewpoints incompatible?

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Comments

  • ShaunBC5ShaunBC5 Posts: 1,727 ✭✭✭✭✭

    I think they are compatible. For one thing, if I’m in the market for a $500 coin, the advice is that I should buy the spread coin. If I’m in the market for a $25k coin, that particular one might not be the best bang for my buck. Maybe look for one that jumps from $25k at 65 to $100k at 66 (or something along those lines).
    If the only coin you need is the 1925-S Peace, then you’ve just got to figure out what works for you based on those and other factors.

  • MrEurekaMrEureka Posts: 24,258 ✭✭✭✭✭
    edited February 17, 2022 11:52PM

    .

    Andy Lustig

    Doggedly collecting coins of the Central American Republic.

    Visit the Society of US Pattern Collectors at USPatterns.com.
  • mr1931Smr1931S Posts: 6,247 ✭✭✭✭✭

    Never play for money a game you don't understand. Widespread misunderstanding about the games people play is why I pick up discarded lottery scratch tickets when I see them on the ground.

    Great spirits have always encountered violent opposition from mediocre minds.-Albert Einstein

  • Cougar1978Cougar1978 Posts: 8,222 ✭✭✭✭✭
    edited February 18, 2022 5:59AM

    Op question: I go with Bowers view.

    In addition I will not buy something so big ticket uncomfortable with from risk tying up funds pov.

    A nice good Barber Half fills the hole IMO. One should have a sane budget.

    Coins & Currency
  • WildIdeaWildIdea Posts: 1,877 ✭✭✭✭✭

    I try to buy the best I can find. I have noticed that really attractive coins with more than one thing going for them are usually available because they are priced just out of the range of comfort zone for frugal buyers or north of what’s a printed spread sheet or auction archives history. These price points kinda protects them in the open waiting for me to notice them.

    I really don’t care what the up front cost of my collection is or the number of pieces, so long as what I’m holding is high end for the grade. I have found that crying once is actually the cheapest way to buy coins (and most things in life) over selling and upgrading or holding dupes. That and I don’t like to buy stuff that my family couldn’t simply consign to an auction and be done with it.

  • pcgscacgoldpcgscacgold Posts: 2,857 ✭✭✭✭✭

    Collecting became more enjoyable when I removed the barrier of a cap to spend. Many new areas came into play when there was not a set limit to spend.

  • skier07skier07 Posts: 3,969 ✭✭✭✭✭

    Buy whatever is going to make you most happy. If you’re buying “expensive” coins and losing sleep at night turn it down a notch.

  • ctf_error_coinsctf_error_coins Posts: 15,433 ✭✭✭✭✭

    Buy unique coins because they are unique.

  • pruebaspruebas Posts: 4,529 ✭✭✭✭✭

    @ErrorsOnCoins said:
    Buy unique coins because they are unique.

    Let me generalize that a bit.

    Buy extremely rare coins because there is no price guide.

  • PerryHallPerryHall Posts: 46,135 ✭✭✭✭✭

    @pruebas said:

    @ErrorsOnCoins said:
    Buy unique coins because they are unique.

    Let me generalize that a bit.

    Buy extremely rare coins because there is no price guide.

    That can work against you when it comes time to sell.

    Worry is the interest you pay on a debt you may not owe.
    "Paper money eventually returns to its intrinsic value---zero."----Voltaire
    "Everything you say should be true, but not everything true should be said."----Voltaire

  • ctf_error_coinsctf_error_coins Posts: 15,433 ✭✭✭✭✭
    edited February 18, 2022 8:41AM

    @seanq said:

    @ErrorsOnCoins said:
    Buy unique coins because they are unique.

    But what if there are two of them? :p

    Sean Reynolds

    I did get the better one ;)

  • airplanenutairplanenut Posts: 22,150 ✭✭✭✭✭

    I think the two quotes are very similar if "within reason" is applied to Garrett's, and I think that is implied. There are two scenarios where I think this can be applied:

    First, you have endless funds. Go ahead and buy the best that's out there. Conditional rarities do have more going for them in terms of growth/investment potential. Not a guarantee they'll all be winners, but there's a track record of good upside.

    Second, you have a set budget. Technically you could afford grade X (for sake of example, let's call X MS66), but it's many multiples of the price of a 65, which is more comfortably in your budget. A 64 or 63 would be a relatively small discount to a 65. The 65 can get you a lot more quality for a small increase over the lower grades, and it's more likely to appreciate than the lower grades. A nice 65 may not quite be a 66, but it can be close and offer a great value, whereas buying a 64 or 63 would mean sacrificing a significant amount of quality when it's not necessary. I think this is the scenario where most people find themselves. Yes, I could sell my house or clear some accounts and get something really expensive, but that's not practical. Unless there's a really compelling reason to do otherwise, I look for a really nice example of a coin in the grade before the price jump. That offers me the best coin, the best upside, and in terms of not pushing the limits of my funds, the least risk in case the market turns or I find something else I'd like to acquire from the same overall pool of funds.

    JK Coin Photography - eBay Consignments | High Quality Photos | LOW Prices | 20% of Consignment Proceeds Go to Pancreatic Cancer Research
  • jmlanzafjmlanzaf Posts: 34,213 ✭✭✭✭✭

    @seanq said:

    @ErrorsOnCoins said:
    Buy unique coins because they are unique.

    But what if there are two of them? :p

    Sean Reynolds

    Then buy the cheaper one. ;)

  • ctf_error_coinsctf_error_coins Posts: 15,433 ✭✭✭✭✭

    @jmlanzaf said:

    @seanq said:

    @ErrorsOnCoins said:
    Buy unique coins because they are unique.

    But what if there are two of them? :p

    Sean Reynolds

    Then buy the cheaper one. ;)

    The "cheaper" less expensive one was the better one. B)

  • MrEurekaMrEureka Posts: 24,258 ✭✭✭✭✭

    @BryceM said:
    It depends on your goals.

    I generally wouldn’t recommend buying the best you can afford. I might recommend buying the best you understand.

    This, with an explanation. "Understanding" a coin means not just understanding both the grade and the price. With the caveat that "understanding the grade" requires more than seeing the grade assigned by a third party, and "understanding the price" often requires far more than pop and auction data.

    @PerryHall said:

    @BryceM said:
    It depends on your goals.

    I generally wouldn’t recommend buying the best you can afford. I might recommend buying the best you understand.

    Agree. I like to buy at the highest grade before there's a big jump in price at the next higher grade. There was a thread here about an MS65 coin that sold for $20K where it was valued $4K in MS64.. I would look for a nice MS64 example which I consider to be the best value.

    On the other hand, the high end 64 may be nothing special, the low end 65 not much better than that and an awful value, and the high end 65 a true treasure and completely worth the money.

    Andy Lustig

    Doggedly collecting coins of the Central American Republic.

    Visit the Society of US Pattern Collectors at USPatterns.com.
  • Cougar1978Cougar1978 Posts: 8,222 ✭✭✭✭✭
    edited February 18, 2022 11:16AM

    I have always viewed the buy the best you can afford thing as seller promotion (big gun dealers wanting move their stuff) and one way to overpay (low end coin, etc.). In reality it all adds up. Buy what comfortably and sanely fits your budget / risk tolerance.

    Additionally big ticket material can be volatile, buyers very fussy too, so a big downward hit in the sheet a terrible situation for owner. If need sell in emergency one could be looking at just getting bluesheet or lower. Your RCI strategy should consider that. Dan has an across the board strategy. Budget number of 60 slabs then divides his total budget plan by 60 to get an average of course some higher some lower.

    Coins & Currency
  • OmegaraptorOmegaraptor Posts: 540 ✭✭✭✭✭

    The reason for the big jump in the 25-S Peace is because the strikes that year were terrible. 1925 was not a good year for quality at the San Francisco mint for any denomination - cents, nickels, dimes, all were generally struck very poorly. It's somewhat like the 45 Mercs in FB.

    You can still look for the best coin you can afford - be picky and look for a 25-S Peace with the nicest strike you can find for the money.

    "You can't get just one gun." "You can't get just one tattoo." "You can't get just one 1796 Draped Bust Large Cent."

  • OverdateOverdate Posts: 7,008 ✭✭✭✭✭

    @seanq said:

    @ErrorsOnCoins said:
    Buy unique coins because they are unique.

    But what if there are two of them? :p

    Sean Reynolds

    Buy the one that is uniquer.

    My Adolph A. Weinman signature :)

  • BryceMBryceM Posts: 11,794 ✭✭✭✭✭

    @MrEureka said:

    On the other hand, the high end 64 may be nothing special, the low end 65 not much better than that and an awful value, and the high end 65 a true treasure and completely worth the money.

    Agreed.

    I enjoy observing how different dealers make a living. There are quite a few who deal in what some would call "dreck" but they know the market, and buy and sell with the right spread and enough volume to do quite well. All of those coins form the base of the large collecting pyramid. Others specialize in a small niche of high-end stuff. They too really need to know what they're doing. Both can loose their shorts and both can do well. It's not really any different for collectors.

  • WalkerfanWalkerfan Posts: 9,315 ✭✭✭✭✭

    I’ve done BOTH of these things. It pretty much sums up my purchasing strategy.

    Sometimes, it’s better to be LUCKY than good. 🍀 🍺👍

    My Full Walker Registry Set (1916-1947):

    https://www.ngccoin.com/registry/competitive-sets/16292/

  • DisneyFanDisneyFan Posts: 2,064 ✭✭✭✭✭

    Thank you for all of your comments. I appreciate them.

    What really caught my eye was Garrett's statement, "...the highest-quality coins have performed best in terms of price appreciation. This has been especially true in recent years with the insatiable demand for coins as part of set-registry programs."

    In another discussion there was mention of a Walking Liberty half dollar collection, with the early Walkers basically in MS64, coming up for auction and one viewpoint was along the lines of "don't expect to see strong interest" in that grade range.

  • moursundmoursund Posts: 3,207 ✭✭✭✭✭

    So far (in my renewed interest in coins after many years away), I've made peace with the idea that I need not worry about resale value. So far I'm buying inexpensive coins for albums. If I decide to really work on a more expensive 'box of 20', I hope to find good bang for the buck coins (in whatever grade) that I love to look at.

    100th pint of blood donated 7/19/2022 B) . Transactions with WilliamF, Relaxn, LukeMarshal, jclovescoins, braddick, JWP, Weather11am, Fairlaneman, Dscoins, lordmarcovan, Collectorcoins, SurfinxHI, JimW. God so loved the world that he gave his only begotten son, that who so believeth in him should not perish but have everlasting life.
  • johnny9434johnny9434 Posts: 28,330 ✭✭✭✭✭

    I buy what I like and what I know sums it, I like

  • oldabeintxoldabeintx Posts: 1,929 ✭✭✭✭✭

    @airplanenut said:

    A 64 or 63 would be a relatively small discount to a 65. The 65 can get you a lot more quality for a small increase over the lower grades,

    I agree with your general reasoning. However , in many cases the price difference between a 64 and a 65 is significant whereas the difference in quality may be minor.

    I may illustrate using other than the numerical grade. A FB Mercury dime vs. a non-FB Mercury. The qualitative difference is often minute in the extreme but the price difference can be huge. IMO the qualitative difference isn't worth the price difference regardless of the depth of one's pocket book.

  • moursundmoursund Posts: 3,207 ✭✭✭✭✭

    @BillJones said:

    British Condor tokens were dead for years. Now they are hot. That works out great for those who bought them back in the 19th century and are now 250 years old.

    But I understand that you cannot actually own property such as coins, while you are legally (and actually) dead. Not sure about that Vampire British Condor token collector...

    On a related note, I've heard that the sun never sets on the British Vampire.

    100th pint of blood donated 7/19/2022 B) . Transactions with WilliamF, Relaxn, LukeMarshal, jclovescoins, braddick, JWP, Weather11am, Fairlaneman, Dscoins, lordmarcovan, Collectorcoins, SurfinxHI, JimW. God so loved the world that he gave his only begotten son, that who so believeth in him should not perish but have everlasting life.
  • MasonGMasonG Posts: 6,261 ✭✭✭✭✭

    @MFeld said:
    How about “Buy what you’re happy with (but hopefully on an informed basis)” ? 😉

    This has my vote. I buy what I like and can afford. That's all there is to it. If I had to worry about all the stuff that people tell me I should worry about, I'd find another hobby. I can't think of anything more soulcrushingly depressing than worrying about what you'll be able to sell a coin for somewhere down the line before you've even bought it.

    But then, that's just me.

  • airplanenutairplanenut Posts: 22,150 ✭✭✭✭✭

    @oldabeintx said:

    @airplanenut said:

    A 64 or 63 would be a relatively small discount to a 65. The 65 can get you a lot more quality for a small increase over the lower grades,

    I agree with your general reasoning. However , in many cases the price difference between a 64 and a 65 is significant whereas the difference in quality may be minor.

    I may illustrate using other than the numerical grade. A FB Mercury dime vs. a non-FB Mercury. The qualitative difference is often minute in the extreme but the price difference can be huge. IMO the qualitative difference isn't worth the price difference regardless of the depth of one's pocket book.

    The exact grade will depend on the series. My want list is filled with coins where I've chosen the grade appropriate for that series just before the price spikes. I only used the numbers I did because it was easier than writing out grade X, then one point above grade X, and then one point or two points below grade X. But just as coins in two grades can be quite similar or night and say, so too with FB, FH, or the like. A just-miss may be a great coin with little premium. A coin that isn't close may have a significantly weak strike that isn't appealing.

    JK Coin Photography - eBay Consignments | High Quality Photos | LOW Prices | 20% of Consignment Proceeds Go to Pancreatic Cancer Research
  • jmlanzafjmlanzaf Posts: 34,213 ✭✭✭✭✭

    @MasonG said:

    @MFeld said:
    How about “Buy what you’re happy with (but hopefully on an informed basis)” ? 😉

    This has my vote. I buy what I like and can afford. That's all there is to it. If I had to worry about all the stuff that people tell me I should worry about, I'd find another hobby. I can't think of anything more soulcrushingly depressing than worrying about what you'll be able to sell a coin for somewhere down the line before you've even bought it.

    But then, that's just me.

    I hate any focus on profit or investment. It just sucks the fun right out of the hobby.

  • MasonGMasonG Posts: 6,261 ✭✭✭✭✭

    @jmlanzaf said:
    I hate any focus on profit or investment. It just sucks the fun right out of the hobby.

    Many of the posters here appear to disagree on where the focus belongs. And it's obvious from their posts that they're not happy even while they continue to participate in the "hobby".

    What is that saying about doing the same thing over and over and continuing to expect different results?

  • jmlanzafjmlanzaf Posts: 34,213 ✭✭✭✭✭

    @MasonG said:

    @jmlanzaf said:
    I hate any focus on profit or investment. It just sucks the fun right out of the hobby.

    Many of the posters here appear to disagree on where the focus belongs. And it's obvious from their posts that they're not happy even while they continue to participate in the "hobby".

    What is that saying about doing the same thing over and over and continuing to expect different results?

    Idk. A lot of them have fun. But it does sometimes seem that the fun is inversely proportional to the price paid.

  • MasonGMasonG Posts: 6,261 ✭✭✭✭✭
    edited February 18, 2022 4:07PM

    @jmlanzaf said:
    Idk. A lot of them have fun.

    Sure. Just not the ones who are worried about what they can sell their coins for before they're even ready to sell them.

    @jmlanzaf said:
    But it does sometimes seem that the fun is inversely proportional to the price paid.

    Can't argue with that.

    edited to add... The people on this forum who seem to be having the most fun are the guys hunting bank rolls for varieties and stuff. And paying face value for their finds.

  • spacehaydukespacehayduke Posts: 5,741 ✭✭✭✭✭
    edited February 18, 2022 5:07PM

    Here is my take. If I can get a 58 that is stunning for a substantially lower price than a 62, then no way I am going for the 62 unless the 62 bowls me over. The difference in wear is trivial, so look for the 58 with amazing surfaces and that is where quality and value are. Same goes for 45 versus, say a 53. I would rather have the uber pq 45 that will cost me less any day. Can I afford the 62 or the 53 in what I collect? Probably, but I collect, I am looking for the nicest coin I can find and the lower the grade, well, the better the value, IMO. So that mantra of buy the best you can afford has never sat well with me........

    My online coin store - https://www.desertmoonnm.com/
  • GazesGazes Posts: 2,315 ✭✭✭✭✭

    One piece of advice for those who want to buy expensive coins----sell one. When you see that there are plenty of deep pockets out there and your coin is expensive for a reason you will sleep better with your other coins. This assumes you did some due diligence on the value and the condition before buying the coin.

  • cameonut2011cameonut2011 Posts: 10,167 ✭✭✭✭✭

    @Gazes said:
    One piece of advice for those who want to buy expensive coins----sell one. When you see that there are plenty of deep pockets out there and your coin is expensive for a reason you will sleep better with your other coins. This assumes you did some due diligence on the value and the condition before buying the coin.

    I admit that top pop or near top PCGS coins have done very well, but I think the market is far more thinly capitalized than you think.

  • GazesGazes Posts: 2,315 ✭✭✭✭✭

    @cameonut2011 said:

    @Gazes said:
    One piece of advice for those who want to buy expensive coins----sell one. When you see that there are plenty of deep pockets out there and your coin is expensive for a reason you will sleep better with your other coins. This assumes you did some due diligence on the value and the condition before buying the coin.

    I admit that top pop or near top PCGS coins have done very well, but I think the market is far more thinly capitalized than you think.

    Depends on your price point. Million dollar coins---yes, there are small group of buyers. Mid five figure coins---there are many more buyers than you think.

  • DCWDCW Posts: 7,316 ✭✭✭✭✭

    I think it always makes sense to pay up for quality.
    Paying ridiculous amounts for the "top pop" that could explode in population in the coming years (ie. 1995-W ASE in PR70)?
    Not so much.

    Dead Cat Waltz Exonumia
    "Coin collecting for outcasts..."

  • DisneyFanDisneyFan Posts: 2,064 ✭✭✭✭✭

    @Gazes said:

    @cameonut2011 said:

    @Gazes said:
    One piece of advice for those who want to buy expensive coins----sell one. When you see that there are plenty of deep pockets out there and your coin is expensive for a reason you will sleep better with your other coins. This assumes you did some due diligence on the value and the condition before buying the coin.

    I admit that top pop or near top PCGS coins have done very well, but I think the market is far more thinly capitalized than you think.

    Depends on your price point. Million dollar coins---yes, there are small group of buyers. Mid five figure coins---there are many more buyers than you think.

    Can you share with us your numismatic background?

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