Newbie Question on SAINT GAUDENS coins.
DwayneDD
Posts: 2
I'm a total newbie to coin collecting, so new in fact that I don't actually OWN any coins yet! However, I am considering my first purchase and I'm hoping for some friendly advise. A local dealer that I have had dealings with on bullion and who I do trust is high on MS-63 $20 Saint Gaudens gold pieces. He makes some good points that I agree with, namely...
1) Saint Gaudens is the most universally traded.
2) Every $20 Saint Gaudens contains nearly one ounce of pure gold which means, at the very least, if gold moves up this coin will follow. I really LIKE this reason because I'm not so much concerned with getting the largest gain. My criterion for success is really simple. I want to hold coins for X years and have my coins be worth 10% more per year than I would have made from straigh bullion coins. In other words, say I hold for 5 years and bullion goes up 40%, I would like to make 90% on my rare coins. Say I hold for 5 years and bullion does up 70%, I would like to make 120% on my coins. Is this a reasonable goal and is the Saint Gaudens a good vehicle for that? If not can somebody suggest a more reasonable goal and/or a better coin? I'm willing to budget probably around $6000 in the next twelve months toward this.
One more thing. When I was young and dumb (now I'm old and dumb), I bought some coins from some guy in a hotel room that were not in any cases and he told me they were MS-65 and were worth $400 each, but he gave me a "deal" of $200 each. Naturally you know how this turned out, I found out later that they were $40 coins, live and learn. That was about 20 years ago and it turned me off to rare coins from my own ignorance. I'm still somewhat hesistant about getting into rare coins because how do I really know that the PCGS grade is for the coin that's in ths slab? How do I know somebody didn't buy a MS-62 and a MS-64 and just swap the coins?
Thank you,
Dwayne
1) Saint Gaudens is the most universally traded.
2) Every $20 Saint Gaudens contains nearly one ounce of pure gold which means, at the very least, if gold moves up this coin will follow. I really LIKE this reason because I'm not so much concerned with getting the largest gain. My criterion for success is really simple. I want to hold coins for X years and have my coins be worth 10% more per year than I would have made from straigh bullion coins. In other words, say I hold for 5 years and bullion goes up 40%, I would like to make 90% on my rare coins. Say I hold for 5 years and bullion does up 70%, I would like to make 120% on my coins. Is this a reasonable goal and is the Saint Gaudens a good vehicle for that? If not can somebody suggest a more reasonable goal and/or a better coin? I'm willing to budget probably around $6000 in the next twelve months toward this.
One more thing. When I was young and dumb (now I'm old and dumb), I bought some coins from some guy in a hotel room that were not in any cases and he told me they were MS-65 and were worth $400 each, but he gave me a "deal" of $200 each. Naturally you know how this turned out, I found out later that they were $40 coins, live and learn. That was about 20 years ago and it turned me off to rare coins from my own ignorance. I'm still somewhat hesistant about getting into rare coins because how do I really know that the PCGS grade is for the coin that's in ths slab? How do I know somebody didn't buy a MS-62 and a MS-64 and just swap the coins?
Thank you,
Dwayne
0
Comments
With higher end grades it will stay a little closer. MS 63 doesn't constitute a higher end grade.
I don't know a way to switch a coin in a PCGS slab without destroying the slab in the process. That's the way the slabs are made intentionally. If coins could be swapped out, what would be the point of slabbing them?
I once felt as you did, but not for long. Try the MS 65 and higher grades for value rising with bullion values.
For bullion, buy bullion.
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
good idea to speculate in collector coins, due to liquidity issues and the 15% plus cost of sales if you are not a dealer.
For longer term holds, I suggest you subscribe to The Rosen Numismatic Advisor (Invester Letter) at 516-433-5800 ($48)
before commiting a penny, and of course the Wall Street Journal before buying any stocks as well as Valueline Invester.
No one can outsmart the market without facts first! Right?
To get in just to make a profit in X years is NOT a good reason.
Get into coins because you LIKE the coin. You Enjoy the coin.
My philosophy on my coin collecting is buying a coin I like and enjoy and I hope when/If I sell I just don't lose too much money.
I think you better stick to bullion ... IMHO
There is no formula to predict how MS-63 Saints will perform with respect to the price of bullion. If you are going to purchase MS-63 Saints as a speculation, I recommend buying PCGS MS-63 Saints and buying the slightly better dates (not 1924, 26, 27, 28) because they MAY (or may not) carry a small numismatic premium, and to me, more scarce coins are inherently more interesting.
I'm a total newbie to coin collecting...
Please don't buy coins as an investment, this is a hobby. You have to love the stupid things to enjoy this hobby, and you have to do your homework.
It sounds like you are more interested in speculating, than collecting. This is okay (I do a little bit of this, as well), but just recognize it for what it is, and know that the margins for trading even a coin as liquid as an MS-63 Saint (and nothing is more liquid) can be as high as 10-15% or more.
Thanks again.
Dwayne
and just cost a hair over spot. Check out the roosters and angels too, the designs are beautiful