Investing in $20 Saint Gaudens

jpkinla

Here is a great article I found written by the folks at CNI which make a great case for buying high grade Saints. If gold runs to approach $500 as we end this year, what do you think it would do to rare coin prices at the FUN show?

Watch as I believe we are going there.

$20 Saint Gaudens Report

roadrunner

People have been saying this for several years now. That exceptional leverage on the upside is also just as exceptional on the downside. While I probably don't agree with companies like CNI on too many issues I am a believer in the coiled nature of the upper grade saints in MS64-66.

When basic 1950's wheat pennies are trading for 3-5x intrinsic value,
you have to wonder why a choice unc. MS64 Saint, 80 years old, nearly ounce of gold at over $400 intrinsic value, isn't even worth 2x the gold. Right now, a far better value than a circulated wheat penny. An MS65 is going for 3x intrinsic value. Not much a premium for a gem coin from the 1920's. You don't see gem 1928 quarters selling for 75 cents.

This will get interesting but let's not use the word "investing" as that gots lots of stock types all worked up. Stocks are "investments" at 130x earnings, but never PM's. Let's just say the Saints offer good speculation. I figure they are a much better than even bet to break $1000 in MS64 than retrace the levels back down to $425 that they started out from 2 years ago.

roadrunner

Deb048gold

I know that there may be some Saints Investors on our Forum. I would like to know if there are any of you out there that just buy common Saints MS64-65 (ex.1908NM,1924,1927,etc) in large quantities strictly for investment? Not for sets! Just curious.

jpkinla

I used to be a "Saint Investor" and started by purchasing MS63's as a gold investment. I did this about three years ago. I then started learning about better dates and it made sense to buy a 1915 in MS63 instead of two or three 1924's for example.

I then began trading my common dated Saints (I had about 400 pieces) with dealers for better dated Saints and $10 Indians.

In January of this year I decided it made sense to complete something so I started set building. I have now finished off the three sets in high quality by trading/selling my dups and buying the best quality I could. In the process, I have learned about coins, grading, upgrading, etc.

It has been fun and now I have some neat coins. At some point, I will probably trade my sets for generic gold again.

My 20th Century Gold Registry Sets

morgannut2

I've stayed away from Saints after an initial plunge led me to other issues. Investment to me means long term, and to me that means a minimum 10 to 25 year hold with a 5 year review (same as my long term stock investments). Sure gold my take off in a brief flash of light but I'm not quick enough to quickly sell a box or two of Saints like a dealer might be. The answer to the question is to find a series that is popular (high demand), you understand, and which provides enjoyment. That will always do better than simple bullion type investing, which this question implies. Your just better off with the semi-key Saints in the long term IMHO.

RYK

I do not like using the words "investment" and "coins" in the same sentence (darn, I just did it ), but I must confess that I have been using stock market gains to fund some coin purchases. I have not, however, sacrificed any of my short or long term investment targets and have drawn from the investment pool sparingly . If the market were flat or down this year, I probably would own fewer coins than I do now.

Next year, if the stock market is flat or down, I will have to add more to the investment accounts to stay on target and that would translate into fewer coin purchases, maybe even sales .

jpkinla

Oh, that's okay. I fund my coin purchases with trading gains in my commodity account. Its best to trade futures and REMOVE any profits so you don't give them back.

I have been buying some MS65 Generic Saints over the last few weeks and have accumulated some 55 pieces. I like these levels and feel we could see $1500 on MS65's by year end easy.

As I type, gold is up about $4 and approaching $450 quickly. This move will gather some steam and we should have a test of $480 before long.

My 20th Century Gold Registry Set

Deb048gold

I tend to agree with the CNI report about Saints, but again its a sales report. Certified Saints in MS64 & 65 are as liquid a commodity and sellable as any coin there is. MS66's and 67's which are mostly in sets have obviously a much lower market demand just due to the smaller buyer market. There is a huge built in market in the US and overseas for Saints and I think you can't go wrong now at these gold prices.

jpkinla

Deb,

I used the link to get everybody to read the report. Not to plug CNI....

mgoodm3

They're trying to create a self-fulfilling prophesy. You read that, invest in high grade saints, which will drive prices up and looky there they were right all along.

RYK

I must confess that I have been using stock market gains to fund some coin purchases.

Stock market up today. Time to find some coins.

saintguru

Sorry JPK but I think you are CHANGING your direction again. These rare collections are not just "golden orbs" to be looked at like soybeans. The aesthetics and appreciation factor is so much of the joy of collecting these. To put together a world class set and then sell as soon as you are done is indeed parrallel to "The Myth of Sisyphus".(ref. Camus) But you know what you want to do. Hey, if you want to sell in a HURRY, I'll take some off your hands, CHEAP!! (or I'll trade you a few hundred 1924 MS65's)

saintguru

jpkinla

I think I have become the "collector" I feared. I am not ready to sell yet! I will let you know when I am.

Seems as if the MS65 and MS66 Saints are getting bid up a bit here. I heard that in Santa Clara today MS65's are changing hands at $1300 dealer to dealer. Thats up a $100.

My $20 Saint Set

dragon

<<< . I heard that in Santa Clara today MS65's are changing hands at $1300 dealer to dealer. Thats up a $100. >>>

Irrational exuberence

Elcontador

Please buy all of the slabbed generic gold coins out there. Don't worry about the price, just pay it. After all, it'll go up some more next week, right? That's what the people waiting in line to buy gold coins said at Jonathan's Coins in Inglewood, CA. back in 1980. I saw it when I was there, dumping every single generic silver coin I owned at the time.

Besides, when I find something at an auction that I like, I won't have as many people bidding against me.

jpkinla

I don't know but I think we are a lot nearer the bottom than the top. I agree that when the real novices start talking about buying gold bars and Saints, I will run and sell everything! I don't think we are even close to that point. Do you?

My 20th Century Gold Registry Set

MrEureka

That exceptional leverage on the upside is also just as exceptional on the downside.

Exactly. If gold dropped 20% to $360, 65 Saints would fall 40% to $800 or so. If you want leverage, you might as well play the commodities market where commissions don't eat you up quite as badly as they do in coins.

roadrunner

You don't want to be in MS65 saints on a strong downtime such as what occurred earlier this year. You could have stocked up on MS65 saints 2-3 months back for $950 or less. There were plenty of pieces being made and going begging. Would be nice to be unloading those at $1300 a coin now. Now is not the right time to be buying MS65's if you missed the $950-1100 boat.

They're trying to create a self-fulfilling prophesy. You read that, invest in high grade saints, which will drive prices up and looky there they were right all along.

I don't think a few CNI clients have all that much effect on the market.

roadrunner