What's the best way to make money with coins?

EVillageProwler

There seems to be a lot of side talk about how this service or that service is so good because of the supposed financial returns.

One person, whom I will refer to as Mr. Ostrich-head and lives in, say, Chino, CA, thinks that the best way to make money in coins is to buy high and, presumably, sell high. Actually, what he really said was that one should buy PCGS coins because they're worth more when it comes time to sell. If selling gets you more, then buying will cost you more, right?

Others, without a holder-bias, think the best way to make money is to buy low and sell high. I prefer to buy underrated series, coins or grade levels now and wait until they become more reasonably appreciated. Obviously, I cannot predict the future. So, I also prefer to buy PQ coins in discount holders (or raw) and then convert them into premium holders. In a way, I'd be buying low and selling high.

Good deal, right? Well, in my case, it requires education. Probably lots of it. So what? That's natural, right? To succeed at some endeavor, it's reasonable to be very good at it.

How many folks here think it is easy to make money when you don't know what you're doing? Come on, raise your hands. Mr. Ostrich-head, you keep your hands down. You always know what you're doing.

Should we go with the buy high, sell high approach? Or with the buy low, sell high approach and educate yourself doing it?

Someone also said that the Ebay results indicate that PCGS slabs bring more money. Thus, PCGS slabs is the best way to make money. How so, Mr. Ebay-stat-head? What you said supports the buy high, sell high proposition.

Ok, final question: who's the sharpest pin on the cushion? Messrs. Ostrich-head and Ebay-stat-head, or those who prefer to buy low, sell high?

Inquiring mind(s) want to know...

EVP

Russ

<< <i>One person, whom I will refer to as Mr. Ostrich-head and lives in, say, Chino, CA >>



I hear they have a lot of sand in that area.

Russ, NCNE

EVillageProwler

Really, Russ? I didn't know that. You know, my choice of Chino, CA, is purely random!

EVP

MJCoin

I can understand your scenerio of buying low and selling high, but it's not always as simple as that. Bottom line from a pure money making venture is to buy what the market and collectors think is acceptable standards. On the other hand, my philosophy is to buy coins I personally like to collect, regardless of what they cost or what I think they might do in the future. As long as I enjoy my collecton I figure I can't go wrong.

TheNumish

My personal opinion is that if you buy coins to hold for a long time to make money your doomed. No matter what the grading service. If you buy coins because you love them, become an expert in your area of collecting then you have a shot of making something. Not a lot unless your lucky.

There are times you can make money if you figure out sommething will be hot like the Capital Vistor $5 in Unc that was issued for $190 and is worth $450. Another example is the Buffalo $1. Buy them and after they pop up then sell, sell, sell.

Is it hard to make money in coins? As a dealer I'd have to say no but it took me years to learn enough to be able to do it. That was the hard part.

The best advice I can give is to collect coins for fun, be prudent when buying and depend on your own judgement when making decisions. Not because you can't trust dealers but because you'll be better off relying on yourself. Enjoy it. Coins are great!!!!

Placid

Short term get state quarter rolls from a bank and sift out the best ones and have them pcgs slabbed.

DHeath

EVP,

The coins I intend to sell (disclaimer - they're usually moderns 1932-now) I usually submit to PCGS because of the market bias, preference, consensus, misconception, insert your own word here. I usually start with raw coins or coins I think are misgraded in holders. I'm right only 60%-70% of the time, and PCGS is occasionally too tough or lax in my view (60/40). The reason this strategy works for me is because I try not to overpay when I purchase, and I try to stay in series with strong demand. I enjoy the grading exercise, and it helps fund my hobby. I'd hate to do it for a living, and I feel for the dealers who have to win a higher percentage than I do consistently to allow their business to survive. Usually the material I buy raw can be resold raw for the original purchase price if it isn't misrepresented to me when I buy it, and holdered if it qualifies. I spent many submissions learning what worked and what didn't. Right now, I'd say my exercise has been a financial push, but I've gotten to look at and grade thousands of coins myself, and even compare my grading skills with the graders at PCGS, NGC, and ANACS to see how I've progressed. I will warn you though that frequently the nicest coins I find I end up keeping instead of selling, and that is where most of my gain has been spent. Making money with coins assumes you're willing to sell your best work!

BTW - It's really the coins, not the plastic, but all of the plastic is marketable.

MastaHanky

I've always found the best way is to steal them and THEN sell them.

IrishMike

I've been working at making a living for 44 years if you want to count caddying. I make my moneyon the job. This is a hobby to me, coins are fascinating to collect, to look at and to hold. Learning about them makes it more enjoyable. All my kids are making a great living, my wife is taken care of. I don't care if they sell for over face value when I am gone. In fact I hope some day to donate or give most of them away. I've worked for too long at jobs making money to turn my favorite hobby into another search to make money. Its the search for nice coinage that intrigues me.

stman

Somebody here has a little phrase after their posts that reads, the most money I ever made on coins are the ones I haven't sold. I sometimes agree with this.


stman

keets

to go just from the thread title the answer would seem to be your simple buy low/sell high. but i sense that your talking a little about speculation.

one thing i find myself doing is looking at coins just cause i like coins. there are of course certain types i like more than others and certain ones i collect by series that i always end up getting frustrated about not being able to locate. but from looking around and with seeing sale prices it's easy enough to spot stuff that seems way under priced. i'm honed in on a series now that has raw coins by the boatload for low prices along with small slabbed pops in higher MS grades and the coins i've been seeing lately are nice and a bargain. no, they aren't state quarters but it's an obsolete quasi-modern!!!

i figure i'll learn about that series and buy the best coins i can find while they're still unnoticed by everyone else, at least in the N.E. Ohio area. it seems sensible.

al h.

GAT

Living on the Westcoast, being retired, I have the ability to be up all night if I wish. You would be amazed at how many idiots end auctions in the middle of the night while the country asleep. While the Snippers take some with their automatic snips, I have found some very good buys during these odd hours.

crito

What's the best way to make money with coins?
give the customers what they want: PCGS slabs. a few really smart bargain hunters may shun you, but the droves of average intelligence collectors will more than make up for any lost business.

EVillageProwler

give the customers what they want: PCGS slabs.

That's only half the equation -- the sell side. What about the buy side? How do you buy PCGS coins low enough so that you can sell 'em for enough of a profit to make a living?

EVP

Placid

You make your own with raw coins or know how to spot a under graded coin. Coins with big price difference for one grade can be money makers if you know what you are doing.

If you look at the thread for the proof68 columbian you can see the pop shows zero for that grade and it's in a new ngc holder.
It very well have been in a pcgs proof 67 holder or other holder before.
If so now it's a pop 1 coin and worth thousands more.

Some people submit the same coin 10 times until they get the next higher grade but there is alot of risk unless you know what you are doing.

JJacks

EVP, I know what you are getting at, but here are a few points to ponder.

1. Coins that appear undervalued often stay that way for a long time. I think you have mentioned 2 cent and 3 cent pieces as being undervalued in other threads. Note that there is also relatively little demand for them. I'm not saying they will always be undervalued, but that certainly is a chance. For many years, sportscard collecters have mentioned guys like Rafeal Palmeiro, Edgar Martinez, etc. as being undervalued, and 10 years later, they still are. There will always be bidders for common date MS64 Morgans, not to say that they will go up either.

2. You mention buying coins in "discount" holders and selling them in "PQ" holders. I assume you mean that you can buy a coin cheap for example in an NGC holder and sell it high in a PCGS holder. Most NGC and other coins don't cross to PCGS, and another way to run it is to buy a coin in a "PQ" otherwise know as PCGS holder, and convert it to a higher grade in a "discount" holder.

3. You CAN buy PCGS slabs at reasonable prices sometimes. 1. If you buy in a large lot, or a complete collection. 2. If you wait for the good deals to come and don't just buy a coin for the sake of buying it. I would rather pay $600 for a 25-S Peace in PCGS MS64 then $10,000 (remember it is worth $20,000+ )for an MS65 from some other grading company, where the coin is really only MS64, wouldn't you? I'm not saying all other grading companies overgrade, but all except maybe 2 or so do.

4. Remember that you can buy a coin raw and grade it through PCGS. You always want to go to grading company where your coin will resell for the most $, if you are interested in the $. If you don't get the grade you want from PCGS, fine; crack it out and send it elsewhere.

JJacks

keets

How do you buy PCGS coins low enough so that you can sell 'em for enough of a profit to make a living?

now we get to the real meat of the thread!!!

al h.

beartracks42

If your only goal is to sell coins to make as much money as possible, then get yourself a spot on a TV network and sell to the newbies and non collectors. Doing this, it does not matter what you are selling or who's slab it is resting in.

Gary

Russ

<< <i>I've always found the best way is to steal them and THEN sell them. >>



Ah, a Newport Beach postal employee.

Russ, NCNE

DHeath

EVP's point is painfully obvious to me. Buying coins already in argueably the most expensive holder and reselling them hoping to profit is certainly unlikely unless the market moves or a series becomes overheated. The occasional bargain doesn't really change the equation. Every time someone buys a high profile coin at a well publicized auction, they are paying more for the coin than any other collector was willing to pay. Since raw coins are sold at a discount, learning to grade and submitting your own coins certainly sounds more likely to produce a profit, if that's your motive.

oreville

EVillageProwler: Your quote:



<< <i> How do you buy PCGS coins low enough so that you can sell 'em for enough of a profit to make a living? >>



usually that is the best way to buy crippled coins for the grade and forever have crap that won't sell.

Sure there are exceptions but you are looking at it all wrong.

There is NO BEST way to make money with coins! But there are LOT OF WAYS to lose money in coins.

YOU MUST BUY WHAT YOU LIKE AND YOU MUST LIKE THE COIN AFTER YOU BUY THE COIN AS WELL!

Think as a collector........if the coin appeals to you as a collector with a correct understanding of real rarity and also reading a lot of books and truly understanding the hobby and also keeping the coin long term (at least 10 years)........then you have a chance......why???......because if the coin appealed to you as a collector then there is a chance the coin will appeal to a future collector as well........but the longer you hold the better your chances.

EVillageProwler

Thanks, Don, for understanding me. Thanks to the many others who made good suggestions.

Extending what Don said, it's always important to be able to buy the best COINS to maximize your profit potential. And, that means educating yourself on grading, eye appeal and market trends (i.e., holder, toning, registry, etc.).

So many people say that you can make money simply by selling PCGS slabs. Well, I suppose that's only part of the solution. What about the other parts? Like the buy side? What to buy? I guarantee that if you buy ugly coins in PCGS slabs, you'll have a hard time selling them. And, you paid a premium for the holder just to get the ugly coin.

I also think it is important to develop a niche market that suits oneself. For example, I prefer only to handle eye appealing pieces regardless of holder (or even if raw). Most of the people I deal with are like this. They are equivalent to my client base -- even though I'm not a dealer. This niche suits me just fine. I feel that I will retain my base for a long time because I'm moving quality, and quality stands the test of time.

I am not convinced that super-grades, registry, holder-bias, etc. will stand the test of time. These clients will come and go, IMO.

I.e., I like eye appeal.

EVP

EVillageProwler

Oreville,

I see our posts crossed in mid-post! You'll notice that I whole-heartedly agree with you!

EVP

keets

EVillageProwler: Your quote:



<< How do you buy PCGS coins low enough so that you can sell 'em for enough of a profit to make a living? >>

i believe he was being facetious. if you preface that quote wuth "hey sunshine" it might be easier to understand!!

al h.

jom

<< <i>give the customers what they want: PCGS slabs. >>



OK, I'll buy some PCGS graded coins, I'll crack out and keep the coins and sell you the slabs. Sound good? lol

jom

ARCO

Coin collecting presents some paradoxes. The coins that are the best performers and sell the best are the very coins that everyone is looking for and nobody can find!!

They are key dates with awesome eye appeal. They are coins on many people's want list. Find those coins and you will make money. Again the paradox. How do you find them?

Most of the key dates I have sold on Ebay have made me good money. Problem is I can only find but a handful a year that do so well. In addition the time it takes to search for those coins easily nullifies any financial gain, if you count your time as an expense. I don't because I love the search and only sell to keep the money flow moving, so that I may perpetuate my demonic addiction!

The buy side is very difficult, as usually the more naive sellers won't walk up to your door, but rather they are the ones who take their coins to the local dealers, and you will be left looking for coins from dealers or other collectors. What a tough bunch they are!

Good Luck,
Tyler

EVillageProwler

One dealer friend of mine told me that the key to being a successful dealer is knowing how to buy. Selling is easy by comparison. He told me that if I can't learn how to buy, then I should seriously consider my animal sanctuary idea!

EVP

michael

buying coins raw and/or in other holders then try to get them crossed to pcgs and then sell for more...............?? yet it is the same coin

buy the coin not the holder

you make money when you buy not when you sell

sincerely michael

cladking

Busy thread. Would like to respond to a few points.

Obviously if the grading companies are all engaged in market grading and they grade
differently then some coins will bring more money in one holder and other coins in a
different holder. I don't know how to do this, but surely there are people who do. All
coins sold for a profit are not in a holder. There are lots of hot coins which aren't worth
the encapsulation fee.

Most of the people who've made fortunes in coins were either dealers or collectors. The
dealers mostly accomplished it by hard work, satisfying customers, and occasional pro-
motions. The collectors almost all did it by collecting underappreciated coins. They bought
series, or quality, or types before they became popular. Certainly some of these collectors
had vast resources to work with but others just persued their interests and time and luck
made them money.


spelling

RLinn

Oreville states

<< <i>There is NO BEST way to make money with coins! >>



He is right on target. There are, however, several ways to make money in coins. Remove the "collecting" aspect (I know, I know, it is impossible to actually remove the collecting part of the equation) for a moment and you have a Business 101 discussion going on here. Two fundamental money making approaches are the "supermarket" approach and the "boutique" approach (there are also others).

The supermarket approach says make a little profit on every item (loss-leaders excepted) and turn your inventory many times because the customer is consistenly looking for "best price." The boutique approach says make a large profit on far few items but you don't have to turn your inventory as often because the customer is consistently looking for "high quality." Both approaches depend almost entirely upon the characteristics of the target customer base. Supermarket customers display low dealer loyalty while boutique customer display higher dealer loyalty. Both paradigms are seen in today's coin markets.

Add to the discussion the issue of location, location, location, (i.e. coin club, store front, vest pocket, eBay, coin show, etc.) and you still have to decide who is the cutomer.

CharlieB

Key coins are the answer in my opinion. That's all I
buy anymore, those with the greatest of eye appeal.
If I knew this 30 years ago I'd be sipping exotic
drinks somewhere in the carribean right now.

But my signature applies to any coin.

- Charlie B -

ANACONDA

The best way to make money in coins is to sell the collection you inherit from a now dead uncle.

Other than that, I have no earthly idea.

adrian

Catch22

Strictly from the standpoint of making money, I'd stick with moderns. Dealing in genuinely rare coins isn't going to get you that periodic 10,000% profit like you see with modern issues. Examples: 1999 Silver proof set will net you about 300%, MS68 State Quarter that goes for around 1000 bucks, 2001 Bufs will net you around 300%, etc. etc.

If you were to order large quantities of coins from the mint and hold on to them for a mere 2 or 3 years, sell the duds on ebay for a wash, sell the high demand coins at a profit, you would probably make money. From the looks of things on ebay, that seems to be the current recipe for calling yourself a dealer in rare coins. I'd rather sort through the various blades of grass in my lawn....