A head's up - don't fixate on cost and do yourself a major disservice when you go to sell or trade y
coinguy1
Posts: 13,484 ✭✭✭
A recent thread of Anaconda's, link which makes reference to trading coins in against others, reminded me about how many collectors (and even dealers), who sell or trade based upon their cost, often end up doing themselves a major disservice.
I have seen many collectors offer/sell coins/collections, and usually, their decision to sell appears to be based upon whether they can get their money out of their coins and/or make a profit.
What's wrong with that and what usually happens in such cases you ask? Often, they end up selling some coins way too cheaply and getting stuck with others. In other words, they have been "cheery-picked", based upon price and/or quality. And, their once-desirable "collection" has suddenly morphed into a conglomeration of not so desirable stuff.
Current market value, should be a much more important consideration than cost, and in this day and age, in most cases, it's not too difficult to come up with current market value. If you can't do it on your own, ask someone for help.
So, the next time you go to sell a coin or group of coins, please be sure to consider other (more important) factors, in addition to cost. I realize it's much easier said than done, but I know you can do it.
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I've often been cheery-picked. It was quite enjoyable...
siliconvalleycoins.com
I would like to amicably disagree with you. If we were talking investments, I would completely agree. You buy Intel at 30, 6 months later it is 22.5. The stock market, especially for stocks like Intel, is pretty efficient. You no longer like Intel's outlook and you sell to deploy your money somewhere else where you believe the prospects are better. If you are in a taxable account, you even get a tax break.
Back to coins. If I buy a proof seated quarter, as an example, and after six months of owning the coin, it no longer fits. I personally want to blow it out the easiest, fastest, and painless way possible. I stress painless because collecting should be fun, not painful. I do not like looking at my coins and seeing a few glaring mistakes in the group. That's no fun!
If I trade the coin back to the dealer who sold the coin for 100% what I paid there are at least three possible scenarios:
1. If the coin is worth about what it was when I purchased the coin, the dealer probably eliminates any small discount on the next couple of purchases. Psychologically, collector (me) feels whole again. Customer is happy to get rid of coin and is happy to deal with dealer again. Dealer may be happy, unhappy, or neutral. Perhaps he has another customer for the quarter and can blow it out fast, perhaps not. Customer (me) should try not to abuse the privilige and never to buy hot coin or something that is a quick sale for dealer. It works better if the coin traded for has been in dealer's inventory for a while such that maybe shifting dealer's inventory around a bit is mutually beneficial.
2. If the coin is worth more than when I purchased the coin, I personally would probably share the "profit" or let the dealer have the profit as a favor for getting me out of the coin. Customer is happy, and dealer is presumably happy.
3. It is most problematic when the coin is worth less, especially if it is worth considerably less. Since I do not tend to buy such coins, I have little experience. My take would be to ask to dealer to credit me as much as comfortably possible. I understand that the dealer is in business to make (not lose) money, and the service he/she provides, is to make me numismatically happy. If I cause pain to the dealer, he/she will not be in mindset to make me happy.
So in short, the exercise is all about making dealer and collector happy and avoiding pain for both.
<< <i> If the coin is worth more than when I purchased the coin, I personally would probably share the "profit" or let the dealer have the profit as a favor for getting me out of the coin. Customer is happy, and dealer is presumably happy. >>
Robert, in this scenario, I see no reason for the client to share any profit with the dealer.
Presumably the dealer sold the coin at a fair price at the time of the original transaction, and any loss or gain would/should be incurred by the buyer/client.
If, for example, the coin has appreciated from $1000 to $1500, even if the dealer takes it in trade at the $1500 level, he is hopefully doing so at current fair market value. And, at the same time, he will be making a sale of whatever the $1500 coin is traded in against.
Remember, too, that the dealer is not necessarily doing the client a "favor" in "getting him out of the coin".
<< <i>It is most problematic when the coin is worth less, especially if it is worth considerably less. Since I do not tend to buy such coins, I have little experience. My take would be to ask to dealer to credit me as much as comfortably possible. I understand that the dealer is in business to make (not lose) money, and the service he/she provides, is to make me numismatically happy. If I cause pain to the dealer, he/she will not be in mindset to make me happy. >>
I'm glad you have little experience with this scenario - many others have not been so fortunate.
In this situation, it is unfair/unrealistic to expect the dealer to over-pay for the coin (I know YOU wouldn't expect that), just so the client doesn't realize a loss. Of course, the dealer can offer an inflated trade-in value on the coin, and over-charge on the new coin to make up for it. But, that is in a sense, avoiding reality.
<< <i>So in short, the exercise is all about making dealer and collector happy and avoiding pain for both >>
I agree with that completely. But, I believe it can and should be accomplished while dealing with current fair market value, rather than simply the cost of the coin(s) to be traded.
"Seu cabra da peste,
"Sou Mangueira......."
My argument is based on my limited experience is trading back coins that are not especially volatile, within one year, working with a specialist, and in a generally up market. The latter point is important in that I understand that the value of the traded coin may have nudged up a bit since I purchased it, and that the traded coin will likely (hopefully) find a new home sooner rather than later. In a down market, in a volatile series, in a series in which there is no two-way market, and years later, it may be difficult to complete the trade and feel whole.
I also understand the reality is that to stay in business, coin dealers want money, not more coins. (If I offer you a gazillion Indian head culls for one of your proof quarter eagles, you would certainly not be happy about it.) Somewhere, somehow the dealer will likely profit on the transaction (happy dealer), and I will get out of the coin I do not want and into the coin I do want (happy collector).
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 have seen many coin sellers have coins for years that they quote a price on that is much higher than current market retail and say that they are ''into'' the coin at retail or more and refuse to sell the coin at a ''loss''
such is the coin game
michael
But yeah I agree, if you’re scared to dump a dud & take a loss on it will take up space in your safe forever. Cost paid means something to me but I hate to sit around wasting time trying to get my $$ back out of a dud so I’ll sell it for whatever it’s worth and put my $$ toward something else.
I think that’s what this thread is about?????
Dog97
Choose Your Title
Since I don’t deal with any great rarities that require a specialized dealer with contacts with specialized collectors to sell my coins I just sell them myself and usually make some kind of profit and BUY what I want from the seller. I could probably shop my better stuff around and make more $$ if I had the time & patience but I have neither.
But yeah I agree, if you’re scared to dump a dud & take a loss on it will take up space in your safe forever. Cost paid means something to me but I hate to sit around wasting time trying to get my $$ back out of a dud so I’ll sell it for whatever it’s worth and put my $$ toward something else.
I think that’s what this thread is about?????
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as per the above dog said it the best i ever heard
if i was a coin seller i would post the above next to the coins i am selling and require every purchaser to read it before we transact biz
michael
I think that’s what this thread is about?????
Actually, I think the point of the thread is that you might do yourself a major disservice when you go to sell or trade your coins........... by leaving money on the table.
Experience the World through Numismatics...it's more than you can imagine.
This is a very good post. I agree with you 100%. If you only sold the coins in a collection that you were getting your money back on or a profit, you would be sitting with the junk left over. In reality you should be doing the opposite and selling all the coins you would lose on, and keep the ones everybody wants.
A think for a dealer it is even more important to get rid of stale inventory and hopefully reinvest in coins you can sell faster and make a profit on.
Good Point..
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
K S
Dog, this thread is about all sorts of things, including not being too fixated on cost (and ignoring other more important factors) when selling - that can end up hurting you badly.
Andy, thanks for some good points and advice.
<< <i>sad when so much, SO much focus is on the $$$ aspects of coins >>
Karl, I was speaking of when collectors are selling/trading, not buying.
I didn't suggest focusing on price in a buying situation in this thread, so please don't get too upset with me? Still, I am glad to see you posting here.
That point crossed my mind too but I couldn't correlate fixating on cost and still leaving $$ on the table. Most collectors fixated on cost try to squeeze every possible cent from a deal, IMO.
I’d rather leave some on the table than flush it down the toilet.
Dorkkarl - True, although I expected you to simply state the converse of Dorkkarl's Law: "When you don't like the coin, really don't like it, just sell it. The price doesn't matter."
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
I would agree with that.
<< <i>Dorkkarl - True, although I expected you to simply state the converse of Dorkkarl's Law: "When you don't like the coin, really don't like it, just sell it. The price doesn't matter." >>
that makes no sense, because if you don't like it, you wouldn't be owning it to begin with (assuming you regard my 1st rule).
the converse, correctly stated, is: if you hate the coin, if you really REALLY hate it, then you would not purchase it for ANY price, period.
K S
Rules, even yours, are made to be broken.
What if you liked it at first and then:
1) Decided to quit the series
2) Decided to do the series in a different grade or with a different look
3) Liked it at first, then over time, with additional knowledge and experience, no longer want it
4) Or any other reson to trade or sell back a coin that you no longer like, want, collect, appreciate...
OT: DK, I am glad to see you back here posting.
<< that makes no sense, because if you don't like it, you wouldn't be owning it to begin with (assuming you regard my 1st rule). >>
Aren't collectors allowed to change their minds? After all, there is often a fine line between love and hate.
When dealers sell to dealers, then all bets are off. They both should know better. If one gets a dud, caveat emptor.
roadrunner
I did not know that we were talking about duds. I was talking about nice coins that no longer fit. High-end and specialty dealers buy and sell high end coins. High-end dealers prefer to have their coins sold or traded back to them, so that they can please another customer.
My "duds/mistakes" were purchased from the major auction houses, sight-unseen. I no longer purchase coins this way.
Robert
However, if it is just a little irritating, maybe you can "work" with it via a ...trade... or a sale on decent terms.