Gold Coins, good or bad investment ?????
MoMoney
Posts: 4
Anyone know, gold coins dealers say yes, but I wonder why they are pushing gold coins for sale, maybe they are investing into something else, but what?
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Hmm I wonder why.
I would say there is a 50-50 chance of that.
and rare date gold is a hobby not an investment
Bill in Dallas
Bullion is diffent than numismatics, and should be recognized as such. Your goals should drive your decisions, rather than your fervor for beautiful coins. (although I fully understand the latter)
Gold is SO beautiful. I wish I could afford it.
Cheers!
Everyone should own just a little bit in gold coins as you never know with our economy. Sure they haven't done so well in the last 5 or 10 years but if you had bought them a year ago when no one wanted them then they did pretty well compared to the stock market.
Personally, I happen to like silver coins a little more especially in liberty walking halves and mercury dimes. They can still be found at 3.5 times face value or a tad bit higher. That is a very reasonable premium when you have numismatic value to boot as a bonus.
But there is room for both, the silver being more affordable and a loaf of bread can be bought with a couple of silver dimes whereas gold coins a bit too pricey for small everyday necessities.
The best way to buy gold coins in my opinion is to stick with nice circulated pre 1877 liberty (coronet) $20 double eagles. If you pay slightly above bullion you have yourself a great coin and a great collectible as well.
Of course, I am partial towards mint state type II liberty $20 double eagles (dated 1866 to 1876) . You simply can't go wrong with them. They have not gone down in value in the last 15 plus years if you ignore the 1989-1990 bubble.
The bottom line though is once you look at coins as an investment is to get the he** out of the hobby and go elsewhere. The best way to make a "fortune" in coins is look at it as a hobby and NOT as an "investment." WHY? Hobbyists know what other hobbyists will want and the hobbyists are the future buyers day in and day out whereas investors are not always around.
Far more eloquently stated than my response - and right on the money.
Buying gold is speculative -- it certainly should not be a main part of your investment portfolio. However, it is fine to buy some gold to diversify your portfolio, as a hedge against disaster, etc. As others have stated, gold is pretty -- you gain benefit from owning apart from its role as a hedge -- and coins are even better is this regards, and, when well selected, probably less volatile in the downside price.
As I have said previously, I believe the global trend is deflationary, and I doubt that inflation will be a problem in the United States for the forseeable future (eg - next 20 years). Undisciplined politics, of course, can lead to inflation at any time, but the substantial independence of the Fed is an important check against this problem.
K S
When the market is “overly exuberant” it’s a good idea to sit on the sidelines. When the prices are down and the gurus are saying the gold is a bad buy, it’s often a good idea to put your toe in the water.
Gold coins are divided into two categories, the bullion coins and the numismatic or collector coins. I much prefer the collector coins both from the fact that they are more fun to own, and they have more upside potential. The bullion coins are tied to the price of gold, and unless there is a surge of interest in them as collectors’ items their upside potential is limited to bullion prices.
As a dealer I can tell you that there is a shortage of properly graded common date gold type coins currently available. I have had trouble filling want lists for these coins, and whenever I get a really nice type coin in inventory, it does not last long. Some dealers have pooh-poohed these coins for years saying that they are “generic” and too common for long term growth. I disagree.
I think that these coins have potential for price increases in the coming years AT THE CURRENT PRICE LEVELS. If the big firms decide to promote them, I’d have to change my view. The key is to buy coins that are properly graded, and a fair number of the certified pieces are not. That’s why I would advice the novice collector to learn as much about grading as he or she can.
If you are a non-collector and only want to own some gold coins for your portfolio, I would advise you to purchase bullion gold pieces and to avoid the collectors’ items. The risk of buying overgraded pieces is too great, and the resale of them is more complicated for those who do not have a rudimentary knowledge of the coins business. The only "old" gold piece that make sense for you might be certified twenty dollar gold pieces, but even those are subjuct to grade and eye appeal issues when it comes time to sell.
Here is an example why having gold or silver is good. In the 1920's Germany had runaway inflation and their currency became worthless. Here is a 5 mark silver coin that was counterstamped trillion mark. Bought about the same amount of goods as a 5 mark piece as it did a trillion mark piece.
This is a coin from my collection and I'm really happy I finally get to show it off.
One thing I'm sure of is I can't compete against them, don't think Bill Gates could either. They'll likely keep it in a tight range. There's a reason it stalls out above $325, despite all the panic buyers.
I have been considering bailing out on this collection and would appreciate opinions.
Thanks
I think that there is a group of collectors who are collecting the $5 (10th ounce) gold pieces by date. These pieces are relatively inexpensive and they are attractive little coins. Others may be collecting the higher denominations, but the when you get to the $25 and $50 coins, the expense factor begins to be important.
I don't know if these coins will develop a collector following in the future. If they do it will probably in for slabbed pieces in the mega grades with Registry implications. I have a feeling that the marked up coins will be worth their bullion value and little more.
I will tell you this. This spring I did a display on the 1907 High Relief $20 gold. Part of it included a Capital Plastic holder that contained the five (gold and silver) bullion coins because the obverse design of the gold pieces came from St. Gaudens. I had a lot of collectors come up to me and ask about purchasing that set. All the gold pieces had the Roman Numeral dates, and I don't know if that anything to do with their interset.
K S
BUT:
I also like Peace Dollars, Morgans and Walkers. I can do an awful lot of upgrading in these collections with the $5,500 or so I have in Gold Eagles.
If I bail on the gold and invest that money in my other collections, I am confident I am building more numismatic value.
decisions, decisions.
funny i have NEVER heard them say they think gold is going to "cool" off for a while.
a short-term speculation is the only place you're going to profit from it (in which case you're more likely to lose from brokerage or spot costs).
gold is a hedge against inflation, that's it. a $20 gold in 1920 bought you a good suit. a $20 gold today stills buys you a good suit.
2 Cam-Slams!
1 Russ POTD!
I am buying them so that means they are a bad investment.
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since 8/1/6
I agree with all the comments made earlier about hobby v. investing. However, some of the coins like the High Relief Saint will always be a good "investment", just as most classic keys are. But I still classify any numismatic gold purchase as a hobby event, not an investment. I just have strong feelings about certain coins... I guess that is were we can get in trouble sometimes.....
I have it because I want is as a collector. I could sell that piece at a profit now because the bids have gone up. Still I'm not so sure it's such a safe investment. Probably 90% of the orginal mintage still exists in some grade. Among those probably 5 to 6 thousand are Mint State or very close to it. As such the High Relief is probably the most common high priced (5 figures for a nice Mint State coin) in the world.
While it's true that demard is far more important than supply in setting the value of a coin, the supply of High Relief coins is quite high. I have more confidence in the early coins (1792-1807) I own, but still the High Relief $20 is a classic that I really enjoy.
Perhaps, that is because you can run a bunch of them through your hands with greed in your eyes a lot more easily than with $20 low relief St. Gaudens?
Senior Member
K S
"they" that is selling.
Adolf Hitler
http://www.financialsense.com Also some interesting articles there about the current housing market bubble and potentially how long the current down stock market might last.
Crito is right when he notes that the gold price has been controlled to the under $330 level. This is being done by the Central Banks and large brokerage houses. Sinclair discusses it in detail.
Gold has not sought it's market price for 20 years due to the actions of the Banks. Whether things will remain so with the current financial mess in the world remains to be seen. Fascinating reading for anyone who holds any position in commodities, coins included. But look out if the Central Banks cannot keep gold under the $330 level. You'll hear the water starting to rush through the cracks in the dam.
roadrunner