Do coins at auction often sell for higher prices than they would on the bourse floor?

gsaguy

I recently corresponded with forum member ArtR about this subject and was wondering what other forum members thought. At the recent Superior Sale during the ANA I saw toned Morgans bringing some really strong prices. Some of these Morgans I deemed no better than coins I was offering for sale on the bourse floor but got no takers at much better prices. Perhaps it's just that I liked my coins better, but to me it appears obvious that many coins bring more money at auction than they will on the floor. Why?

Was it that some of these bidders were buying for clients who told them to do what it took to buy the coin? None were what I'd call Monster toned.

Some might say it's because certain buyers want to be 'seen' as the high bidder. In many cases I believe it's because the high bidder is not really sure of himself and seeks a comfort level of knowing that someone (the underbidder) was willing to pay almost as much as he. They won't get that same comfort level buying on the bourse floor.

GSAGUY

airplanenut

If the coins are very similar, they probably sell for more at auction if two people get caught in a bidding war.

Morganluver

The huge amount of exposure via internet and floor could be a big factor. I'm sure there are hundreds and possibly into the thousands viewing any given coin and it only takes two people to push the price up. It would be nice to have even a small % of those people at your table vying for your coins.

Clankeye

I think it has much to do with a psychology factor. We talk about "winning" an auction. We get territorial if someone else starts bidding on a coin we want. I think it works both ways, too. If it is perceived in an auction that no one else really is chasing a coin, that can depress the desire for it. It's an Emperor's New Clothes syndrome.

truthteller

When one ask's a ridiculous price for a pretty coin on the bourse floor, the coin has to attract the right customer, be it retail, crack-out guy, etc. In an auction, the exposure is such, that a ridiculous price is more acceptable to many bidders, not just one potential buyer. In addition, many bidders use the 30-45 float on payments the auction companies give to generate cash flow, thus improving the price realized for any given coin. The downside is the consignor must consign 30 days before the auction and wait essentially 45 days to get funds. Is the extra percentage worth the extra return?For some, yes.

TRTH

coynclecter

There is a lot more exposure in an auction. On the other hand the guy on the floor can afford to knock a little off and still net the same amount. Frankly, unless its a hard to find item, I found the floor to be a better deal if you take time to shop.

Coyn

michael

yes yes yes yes yes yes yes!!!! i see it time and time again if i had a dollar for this every occurance in your thread post i would be rich!!

many many times coins at auction go for more than a compriable coin for sale on the bourse where the bourse coin is not only nicer eye appeal wise but cheaper!! for me if you work with a dealer who you know and trust and have a great working relationship with anfd you are patient then the dealer can usually come up with coins that are much better than many auction coins that are not as good eye appeal and gradxe wise and sell for more!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

such is the coin game. sincerely michael

gemtone65

Gsaguy: In general, many of the very best coins are acquired by dealers who attend the auctions in person. As such, you would expect that when these coins reach the bourse, they would not sell for less than they realized at the auction. So, the same logic should apply to similar quality coins on the bourse regardless of their previous source of acquisition. In short, I would expect to get a better deal in auction than through the bourse attempting to buy from a dealer who hasn't done business with me in the past.

Now, there are exceptions to this observation. For one, when a high quality or specialized collection is offered for auction, all bets are off. The avid collectors come out of the woodwork, and prices can reach new historic levels. For another, at a very well attended show, such as ANA, the auction attendance is large and collector prices may prevail on many items.

Your last paragraph is also very relevant. For the case of toned dollars, it is difficult to know what a fair price is for a given piece. Indeed, this price can fluctuate quite widely for certain pieces. So, having many underbidders gives comfort to the high bidder in such instances that he has paid a realistic price, i.e., one close to what he could immediately resell the item for.

In these regards, it is instructive to focus on the toned dollar pieces that I believe you are referring to from the Superior sale. First, the MS67 1885-cc sold at the sale for about $3400, and was offered on E-bay last week by a dealer, I think, with a BIN price of $5400. Next, consider the 1885, lot 1224. This coin was previously offered in a teletrade sale where it only reached a price that was much less than half the price it sold for at the ANA. The owner obviously knew what he had, because the coin did not reach its reserve in the teletrade auction. Also, as is usual in a teletrade auction, the pictures were terrible and the coin looked much better in person; most teletrade bidders don't get to view the teletrade coins live. The ANA price realized nevertheless seemed a little high to me; but, if you don't mind the ugly part of the toning in front of the face, which I do, the rest of the coin was quite beautiful. And, the toning was unique, an aspect that I do like.

The 1887 (lot 1231) had very vibrant toning on the right part of the coin. In fact, i thought the colors were quite spectacular. However, even though graded MS65 (as was the 1885), the coin had a very prominent scratch on the chin, which occurred after the toning was imparted, so it really looked terrible. I was very suprised by the price, almost $1500 (compared to $1150 for the 1885), but some (many?) people want great color and don't mind marks in key places. I'm not one of them; if I'm going to pay that much, for a common date, I want more than pretty colors. Because, my experience is regardless of how great the color is, if the coin isn't clean, and especially with noticeable defects in the focal area, the defects soon begin to outweigh the colors, and I'm looking to dispose of the item.

In summary, I believe that there were special circumstances that resulted in the high prices achieved by the 2 common date coins, plus they had some nice attributes. Further, for a toned ollar collector attending the auction, those were the only pieces available. Some buyers prefer the solitude of the auction to the hassles of the bourse floor, especially for pieces like these where there is precious little material available for price guidance.

Clankeye

Gemtone65--
That was a very good, and informative response.

1jester

No matter how logical and determined you try to be at a live auction, it is difficult not to get caught up in the excitement and the adrenaline rush of a bidding war, especially if the lots are high quality and/or near-unique. I think this psychological factor raises prices above what you'd normally be willing to pay for any given piece.

gsaguy

Thanks All for the responses! Perhaps I should save the time and expense of setting up at shows and just sell my material at the major auctions??

Naahhh...I enjoy the excitment of the floor too much!

GSAGUY

Nic

Great post gemtone. K