What is the difference between a market maker and a middleman?

Longacre

I was reading an article, and the advice was to sell your coins to a market maker, rather than a middleman. Does anyone know what the difference is between these two terms, and how does one tell the difference? There are a lot of people who sell gold coins, for instance, but how do you tell if that person just sells a lot of gold coins, or if he is a "market maker"? How many market makers can a particular seriest handle, before every dealer in that series reverts back to middleman status? Also, the article indicated that market makers pay more for coins. Is that generally true?

Russ

Market maker is a two way street, middleman is a one way street.

Russ, NCNE

morgannut2

Many but NOT all modern sellers are middlemen, Legend, as an example, is a market maker for all DMPL Morgans >MS63.

PutTogether

I would consider a "market maker" as the person or business that others decide to follow. ie. if THEY sell X coin for X price........that price becomes what that coin costs. It serves as the basis for figuring costs.

The other important attribute is that the "market maker" should be an absolute authority on their coin or series, not just it's market. They should know more than anyone.

I would imagine that these people as a rule, would be WILLING to pay more for your coins than just some dealer, but I'm also willing to be they'd still try to lowball you, thats what business is. (not a dealer slam, negotiation is part of everything, and I understand and accept that)

markglicker

The point is moot. At the right price, most any dealer will buy any coin.

CarlWohlforth

A middleman will buy a coin from you if he knows where he can sell it for a profit. He doesn't hold the coin.

A market maker will make you a market. In other words you can ask him what his market is for a particular coin, say a 1925 Saint in MS 64. He will say "I'm buying at X and selling at Y". You can then decide if you want to buy or sell.

michael

What is the difference between a market maker and a middleman?


nothing .................one in the same

mhammerman

ODE TO A MARKET MAKER

I do agree with puttogether, since we are on the topic. The market maker must absolutely be one of the authorities on the trading of the series. He must be able to locate the coins in a series that he has a market for and market them to those that are looking for that series. That may be somewhat of an understatement but still the basic concept.

My experience with one of these folks over a three year period is exceptional. It was in the '91/93 period and he was a morgan maker. Man, that was a firefight...unc rolls moving around, what kind do you want? End toned was a must for original morgan rolls, both ends and that little tick better be on all of the coins. Single issue vams were becoming noticed and quite the thing of the day for the morgan makers, extreemly vogue for the serious morgan hunters so the market got that far and then it began to collapse! The market maker is the wave of the market. His price is the price and that's the price in USD that day. His coins are dead solid perfect to his client's wishes and he may not have that many clients, maybe 40 or so. And he has his sources and secrets but he also has the coin when there is someone looking for it, as long as they have the money. He often works alone, kind of like a private consultant.

He was very sociable and tidy and very accessible. Having dinner together or being invited over was not uncommon. Your dealer, your friend. Fun experience and I'm glad I still enjoy coins so much, it sure is interesting.

Enjoy