Very POSITIVE article about investing in coins on the first page Section D W.S.Journal!!
saintguru
Posts: 7,724 ✭✭✭
This is quite interesting. Some will say that once the populace comes in to sell, but I would disagree. It discusses the grading companies and benefits for newbies...also says that even though coins have made a run they are still being bought as tangible assets are becoming a staple of portfolios. I'm still very bullish on many varieties.
The odd thing is the coin that they illustrate in FULL COLOR is my, I mean THE 1933 Saint!!
EXTRY, EXTRY, READ ALL ABOUT IT!!!
The odd thing is the coin that they illustrate in FULL COLOR is my, I mean THE 1933 Saint!!
EXTRY, EXTRY, READ ALL ABOUT IT!!!
0
Comments
Self Indulgence | Holey Coins | Flickr Photostream
Joe
Buy coins for pleasure, not for investing
Cameron Kiefer
to make investors. We're really in danger of becoming a victim of our own success.
Profits have a way of attracting investors and investors have a way of causing huge
unnatural swings in valuations which are never really good for collectors even if they
take their profits.
Can you post the article - I'd have bought the issue had I known.
Marc
Let's start a coin mutual fund at SB. Whatya say?
Marc..Can't post it...I don't get the online version
AValde...I could not agree more...but it IS significant for collectors when the base expands!! Same amount of coins, more buyers!
RYK...I'M IN FOR THAT IDEA. Let's start collecting $$.
Thig...WSJ...It's a newspaper...
Didn't wanna get me no trade
Never want to be like papa
Working for the boss every night and day
--"Happy", by the Rolling Stones (1972)
<< <i>Thig...WSJ...It's a newspaper... >>
So that's what that thing that I pay out the arse for a subscription to is... I always thought it was toilet paper.
Self Indulgence | Holey Coins | Flickr Photostream
Liberty: Parent of Science & Industry
<< <i>I'm trying to locate the article. I work for the largest company in the world, and they recently stopped our subscription in order to save money. I guess every dollar counts. >>
You work for Wal-Mart?
<< <i>This development clearly signals a top in the market. Time to SELL! >>
That's what I was kinda thinking.
December 1, 2004
THE WEALTH MANAGER
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Investors Flock to Coins
Amid Rising Metal Prices
By JEFF D. OPDYKE
Staff Reporter of THE WALL STREET JOURNAL
December 1, 2004; Page D1
Rare coins are starting to attract investors more at home with stock brokers than coin dealers.
The interest in coins comes as sophisticated investors are increasingly looking for assets outside of the U.S. stock market, which many market observers expect to post only modest gains during the coming year. In buying rare coins, individuals not only acquire a collectible asset, but they are also getting exposure to precious metals. The prices of gold and silver, from which many popular U.S. coins are made, are both rising smartly.
The Internet and coin-grading services are playing a part in drawing a new breed of coin investors. The Internet allows collectors to buy and sell rare coins at locations other than their local coin shops. The grading services authenticate coins and grade them based upon how closely they resemble a freshly minted coin, making it easier to certify that the coins being traded are investment grade. And electronic registry services that have sprung up on the Internet during the past few years let investors register their collections online and compete against others in building the highest graded, most valuable sets.
All this has helped make investment-grade coins nearly as liquid as the stock market. The coin market even has its own index -- the CU3000 Rare Coin Index. During the past year, that index of the 3000 most-actively traded coins, has gained about 7.5%, while the Standard & Poor's 500-stock index is up about 11.5%. In the past three years, the coin index has gained more than 18%, far outpacing the S&P, though coins are off by about two-thirds from their high in 1989.
The coin market presents risks. Novice collectors often get burned, despite the Internet and grading services. Moreover, many smaller shops are popular but can undercut sellers and overcharge buyers, some dealers and collectors say. And the precious-metals market is notoriously volatile.
Also, coin prices have moved substantially, meaning investors aren't buying at bargain levels any more. Still, coin experts say, coins are about two years into a bull-market that, if it mimics history, will last four or five years.
"There is a lot of smart money going into coins right now because the wealthy individuals see very attractive valuations," says Mark Salzberg, chairman of Sarasota, Fla.,-based Numismatic Guaranty Corp. of America, or NGC, a firm that grades and certifies the authenticity of coins. These are individuals "who have the money to come in and buy the ultra-rarities."
In addition to the lackluster outlook for stocks, the weak U.S. currency is also driving people to hard assets that aren't tied to the dollar. "The dollar is decaying right before our eyes and people want to own those assets not directly tied to the dollar, hard assets," says Geoffrey Hodes, a vice president at Monex, a Newport Beach, Calif., precious-metals trading firm.
And while gold and silver bullion are less expensive per ounce than coins, "bullion is not beautiful or sexy to look at and there's no story behind," he adds. "Rare coins have all that. It's like collecting art."
An ultrarare 1933 Saint-Gaudens-type gold coin -- one of only a few that still exist since most were melted down after President Franklin D. Roosevelt outlawed the hoarding of gold -- sold for nearly $7.6 million, including fees, at auction two years ago. And in August, at the American Numismatic Association's annual World's Fair of Money, a rare, 1792 copper cent -- found in an old tobacco tin -- was valued at $400,000 and is expected to fetch more at auction.
SEEKING COINS
Below are key resources, including two well-regarded coin graders, to help investors interested in rare coins.
Web Sites What They Offer
www.pcgs.com1 Home of the CU3000 coin index. Provides an online price guide and an overview of each coin series. Also has a coin look-up service.
www.ngccoin.com2 A population report for coins graded by NGC, which gives a sense of how rare a particular coin is in its mint state.
www.money.org3 Web site for the American Numismatic Association. Provides educational materials and classes on grading coins and counterfeit detection.
www.coinmag.com4 Offers a beginner's guide to collecting, along with a 12-point checklist for rare-coin bidding on eBay.
Wealthy investors are gravitating toward the most popular and liquid investment coins: the $20 Double Eagles and Saint-Gaudens, each comprising nearly an ounce of gold; Morgan and Peace dollars pressed from slightly more than three-quarters of an ounce of silver; and Liberty Walking half-dollars that hold about a third of an ounce of silver.
Those coins, depending on preservation, rarity and other factors, range from a few hundred dollars to hundreds of thousands of dollars. In general, investors are building high-quality, investment-grade portfolios of various gold and silver coins for between $2,000 and $10,000 per coin -- up from just several hundred to a few thousand dollars a couple years ago. Unlike gold and silver, which investors often own only in paper form, investors hold coins directly, if only to be able to appreciate them as artwork-caliber engravings.
At auction firm Spectrum Numismatics, a unit of Greg Manning Auctions Inc. in West Caldwell, N.J., wealthy retail investors are making up a larger portion of the business these days. Through various subsidiaries, Spectrum holds upward of 130 auctions a year -- from high-end affairs hawking coins that fetch $250,000 or more, to low-end Internet auctions where coins sell for a few hundred dollars.
"People buying these days often have the intent to sell some day," says Greg Roberts, president and chief executive officer. To them, he says, "coins have become an alternative hard asset."
The discovery last year of the S.S. Republic also is piquing investor interest. The Civil War-era steamer, carrying $400,000 in gold and silver coins, sunk in a hurricane off the coast of Georgia on its way to New Orleans, and numerous high-grade coins being pulled from that wreckage are selling for tens of thousands of dollars.
Coin dealers are mainly guiding deep-pocketed investors interested in collecting. Established dealers not only locate worthwhile coins around the country, but also they can help build investment-caliber collections and design profitable exit strategies for selling off the collection. To find a dealer, the American Numismatic Association's Web site, www.money.org, has links to what it considers to be reputable ones.
Investors generally demand coins be graded independently to ensure authenticity and to determine a coin's mint state, or how closely it resembles a freshly minted coin. Coins are graded on a scale of one to 70, with 70 being perfect. Investment-grade coins typically start at MS65 (MS stands for "mint state"), though with some particularly rare or historically significant coins, lower grades are acceptable. Graded coins are locked in sealed, tamper-resistant plastic holders, what the industry refers to as "slabs."
Not all slabbed coins are equal, though. Grading services vary in their quality, and "that's where new investors typically get burned," says Barry Stuppler, a rare-coin dealer and president of the California Coin and Bullion Merchants Association. Investors looking for bargains often jump at seemingly high-grade coins graded by low-tier firms. But they end up overpaying for what turns out to be an inferior coin, Mr. Stuppler says.
The most subtle scratch or flaw can drop a coin into a lower grade and result in a big difference in value. With an 1891 Morgan silver dollar minted in Carson City, Nev., for instance, a very narrow grade shift of MS67 to MS66 changes the value of that coin by about $25,000, according to Professional Coin Grading Service, or PCGS, in Newport Beach, Calif.
PCGS and NGC are widely praised, and coins graded and slabbed by these two grading services routinely trade just on the basis of their reputations. Independent Coin Grading Co., or ICG, and ANACS are gaining respect but still lack wide acceptance. The other services, according to coin-dealer surveys, collectors and independent industry experts, are widely dismissed as too liberal with their standards, and the coins they grade are generally deeply discounted to account for grade inflation.
Of course, you don't have to be rich to invest in coins. In fact, the lower end of the market is booming, too. For instance, Jefferson nickels minted in Denver in 1938 -- the first year the U.S. Mint released that series -- have been hot for the past year, and today the most immaculate examples of those five-cent pieces fetch upward of $2,000 each, according to PCGS, which also produces a much-watched price guide for collectible coins.
Write to Jeff D. Opdyke at jeff.opdyke@wsj.com5
URL for this article:
http://online.wsj.com/article/0,,SB110185851100587385,00.html
Hyperlinks in this Article:
(1) http://www.pcgs.com/
(2) http://www.ngccoin.com/
(3) http://www.money.org/index.shtml
(4) http://www.coinmag.com/
(5) mailto:jeff.opdyke@wsj.com
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Go Jefferson Nickels!
<< <i>"Of course, you don't have to be rich to invest in coins. In fact, the lower end of the market is booming, too. For instance, Jefferson nickels minted in Denver in 1938 -- the first year the U.S. Mint released that series -- have been hot for the past year, and today the most immaculate examples of those five-cent pieces fetch upward of $2,000 each, according to PCGS, which also produces a much-watched price guide for collectible coins."
Go Jefferson Nickels! >>
That's not bad for a coin that might have gone for $10 or $15 in 1989.
Indeed, even today a raw one could theoretically be found at this price.
<< <i>This development clearly signals a top in the market. Time to SELL! >>
Seth
"This coin would look great in your collection. According to the WSJ, NOW is the time to buy blah, blah, etc.
"This coin will only go up in value. According to the WSJ, wealthy investors are buying up blah, blah, etc.
"I'm giving you the chance to own this valuable coin. We're in the midst of a five year upturn in coin prices according to the WSJ."
Joe, blah, blah, blah.
Late 80's?
<< <i>JB,
Let's start a coin mutual fund at SB. Whatya say? >>
Careful careful. Some lowlifes out there have actually floated the idea of "options" in rare coins.
Keep it private and as far away from lowlifes and government as possible.
Tom
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
<< <i>This development clearly signals a top in the market. Time to SELL! >>
Good idea. I'm buying. Send to me for instant offer.
Tom
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
I like to collect coins at a reasonable price. If investors really come into this then they will be causing prices to go so high...well you know the rest of the story.
That is at least my hope...and I am sure there is someone else who hopes they do come in (in a big way)! heh
Don't get me wrong, I'm as passionate about coin collecting as the next guy / gal on this forum. However, I see some opportunities for long term growth, and that's where my investment $ is going. Investing comes before coin collecting, which is one of my favorite activities, but it IS a hobby.
If you want to buy some more coins, I'd suggest looking at a coin series which is far from the maddening crowds.
"Seu cabra da peste,
"Sou Mangueira......."
This development clearly signals a top in the market. Time to SELL!
no way - so totally does not - take your meds bailey
marc
<< <i>Investing comes before coin collecting >>
Interestingly, sometimes they merge.
The next on the list would be bullion , art, coins, and other "things". It's going to be interesting to se what happens when the RE market pops. Although I'm not sure if that ever happened during a war environment. But then we have a government which is out of control with spending and still thinks that this place is the only game in town. It's not.
I think the journal article is timely and we are going to see a continuance of new people coming into the coin business, certainly thruout 2005 and IMHO beyond that. Maybe for the next 4 years. Eventually it will be oversold as well but we're not even close to that now. There's way too much positive stuff going on, at least in terms of this business to worry about it.
Tom
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
I thought "oversold" meant sold off to the point that prices were unrealistically low.
Liberty: Parent of Science & Industry
yeah, its overbought. Overbought -> irrationally exhuberant, Oversold -> irrationally pessimistic
Tanks for da correction.
A correction is what's going to happen in RE in my opinion.
Tom
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
And, what is up with this statement in the article? An ultrarare 1933 Saint-Gaudens-type gold coin -- one of only a few that still exist ... Anyone know of some others?
The Ludlow Brilliant Collection (1938-64)
Damn, I sure hope so... we're hoping to buy a much larger house in the next couple of years... in So. Cal.
Liberty: Parent of Science & Industry
<< <i>
<< <i>Investing comes before coin collecting >>
Interestingly, sometimes they merge. >>
You nailed down what is so facinating about rare coins. I like to appreciate the beauty of coins as a collector but the investment aspect makes it even more interesting - the hunt for a good deal with potential gain.
<< <i>All this has helped make investment-grade coins nearly as liquid as the stock market. >>
Oh, PUHHLEASE! Need I say more?
<< <i> In the past three years, the coin index has gained more than 18%, far outpacing the S&P, though coins are off by about two-thirds from their high in 1989. >>
As pointed out in the Coinguy1 thread by others, the 18% return is from a wide disparity of results ranging from the ultra rarities vs. the rest of the market. Citing returns from a coin index implies a broadness of results - a bit misleading.
<< <i>Coin dealers are mainly guiding deep-pocketed investors interested in collecting. Established dealers not only locate worthwhile coins around the country, but also they can help build investment-caliber collections and design profitable exit strategies for selling off the collection. To find a dealer, the American Numismatic Association's Web site, www.money.org, has links to what it considers to be reputable ones. >>
And while all the fine dealers on this forum are reminding us that coins are a hobby and not an investment. What's the answer to this conundrum - Who are these other reputable established dealers that are mainly guiding investors towards profitable exit strategies? Where can I get me some of that?
<< <i>PCGS and NGC are widely praised, and coins graded and slabbed by these two grading services routinely trade just on the basis of their reputations. Independent Coin Grading Co., or ICG, and ANACS are gaining respect but still lack wide acceptance. The other services, according to coin-dealer surveys, collectors and independent industry experts, are widely dismissed as too liberal with their standards, and the coins they grade are generally deeply discounted to account for grade inflation. >>
Uh oh, another lawsuit!
If you're looking to cash out in the next couple of years, this is your first indicator, especially if you believe that history repeats itself.
<< <i>Who are these other reputable established dealers that are mainly guiding investors towards profitable exit strategies? >>
This is an interesting question. For me, an exit strategy has, concerning coins, always included a new investment strategy within the coin market, never just to dump coins after an ostensible profit...