Price Guide vs. Auction Results vs. Real Value

renomedphys

Been a while since I posted a discussion topic, but this has been really bothering me a bit lately.

Let's say that like any good collector, you have been buying PQ for the grade rarities. Real low pop stuff. Personally, I like to collect RB and BN Matte Proof Lincolns, and a great many of my coins have populations of less than 20 or 10, with few or none finer. I guess the question is: is there really any way to know what your coins are worth when...

-seemingly all of the nice examples for the grade or otherwise are locked up in private collections?

-the majority of the equivalently graded coins sold at auction are dogs?

-Price Guides have nothing whatsoever to do with even publicized private treaty sales?

I imagine that there are a lot of folks out there walking this precarious slippery slope, fully aware that while their coins probably represent good value versus the less appealing examples in the same grade, the publicized value of their coins is negatively affected by the dogs selling at auction, thus increasing the risk with their investment exit strategy.

ricko

Investing in coins is always risky. Rarely a sure thing, especially at lower levels. Mega rarities in great condition are one thing. The rest have no guarantee. Cheers, RickO

mdwoods

I think those in the know and the serious collectors know better, at least concerning Matte Proof Lincolns. They seem to be getting a lot more respect in recent years and PQ examples go for premium prices. Of course you guys here and on the Registry have bought all the nice ones.

coolest

It all depends on how you sell them.

If you bring them to a dealer their is no such thing as a PQ coin, all coins sell for less than grey sheet, even though we know grey sheet values are an average and higher prices are offten paid for nicer coins. But I would geuss that all the higher prices paid were paid by collectors.

And a very strange thing I have noticed about collectors is that they will happly pay strong money to a dealer, or at auction, for a nice coin, but if they are offered a nice coin by another collector any price is too high.

sinin1

Yes, you find out what they are worth when you sell them


another less ethical route if you have no interest in selling them is

show a couple to major players carrying those items at a national show and ask what they will offer you for them
when you get their answer, come back with '"I need (their price +20% (or higher)) for them



or just go to auctions/check pics and compare - is my coin better/worse than that one
then figure what your payment check would be

Walkerguy21D

I don't how you could ever establish a true value for them, short of selling them in major auction. They will bring more than comparable dog coins, but how much more?
I also think if you take legitimate rare PQ Lincolns to a legitimate dealer in such coins, like Angel Dee's, you will get offered more than 'back of Greysheet' for them.

WaterSport

Matt:

I think one reason that price guides are not so real is that there are far more collectors Vs investors. Thus the emphasis is not really there to have up to date ticker type prices. Private sales go both ways. Friends give one another a break while others sell only for top dollar or have top dollars to pay with. To me public auctions say it all on the value.
WS

joebb21

The real issue with the "price guides" is that no 2 coins are really alike (unless they are modern ms69 and 70's)

by looking at the archives you can get a general idea of where a coin is selling for ON AVERAGE. the same with greysheet and the price guide.
If you get outbid-then clearly there is somebody who thinks the coin is worth more than what you were willing to bid.

renomedphys

Great responses! I think the real trick in a case like this lies in market timing. You see a bunch of guys vying for top coins in a series, then you work closely with a dealer who specializes in that series to maximize return.

The problem with auctions is that if one of the two people who want the coin don't show up, you can get slaughtered in a no-reserve scenario. And if you place reserves and they aren't met, it's like you're paying just to get back to where you started.

Last summer I placed 3 MPLs in auction with no reserve and lost SO MUCH MONEY. Grrrrr.

roadrunner

If you bring them to a dealer their is no such thing as a PQ coin, all coins sell for less than grey sheet, even though we know grey sheet values are an average and higher prices are offten paid for nicer coins. But I would geuss that all the higher prices paid were paid by collectors.

That may be true of local shops or dealers who don't specialize or look for anything in particular but I know many different dealers who are more than happy to pay PQ or even next grade money for pq/upgradeable coins. Those kinds of dealers are <1% of those out there but there are enough of them to make it count.

And a very strange thing I have noticed about collectors is that they will happly pay strong money to a dealer, or at auction, for a nice coin, but if they are offered a nice coin by another collector any price is too high.

My experiences exactly. Most collectors feel more comfortable passing on your coin for X, but are happy to pay X+15% to their national retailer or at auction....for the identical same coin.

roadrunner

pf70collector

Mega rarities in great condition are one thing.

Didn't the 1933 MS 65 Saint just drop by 1.5 million in the PCGS Price Guide. Not even mega rarities are immune.

pennyannie

renomedphys- The value is mainly collector intrest in my opinion. For the last few years MPL's seemed to go up daily and lots of post were made on these forums. The upcoming and now passed 100 Anna of Lincoln stirred up the prices. As long as you can sustain intrest then the better the eye appeal coins will command prices that i have a hard time justifing based on what the so called dogs sell for. If the intrest wanes then the multiplies of bid will start to fade on some but not all in the series. A year ago i had all the MPL's except the 09 VDB. I only have 2 now because i could never justify the price i paid and felt that the prices would make major swings. I could not afford major price swings.

I have heard on here that you have one or 2 collectors give up on a series and prices can tumble in a hurry.

I think the prices went to high to fast to stay for the long haul. Coins i paid as little as 400 dollars for 3 years ago ( maybe more as time flies) were easily sold for 1600 to 2k and so on. I was a happy buyer at under 1k but would not feel the same at 6k and up. Others have more money and getting in late does not bother them.

How do you determine the price of the better eye appeal ones? I still do not know, i guess follow Brian Wagners lead.

renomedphys

You know, I really didn't mean for this to turn into a discussion on MPL pricing. I'm really curious about the same thing occurring in other series as well.

That said, it's true that hype can be a scary and predictable thing all at the same time. I remember thinking in late 2007 that the buzz about Lincolns in 2009 was going to drive prices up. It did. I remember thinking that it would probably just build and build until 3rd quarter 2008 and then the bubble would pop. Turned out to be true in a big way, thanks to the tanked economy. Somehow I managed to escape by selling off my MS set in the beginning of October '08, providing the fuel for my MPL set. Sad thing is, I feel that any gains I made in the MS set would be handily lost should I place my MPLs in auction. I don't really feel bad about this, as I am probably right where I started out investment wise, which in perspective, isn't really that bad at all.

Back to the thread topic, I guess what it boils down to is that public interpretation of a coin's value often hinges on auction results. Auctions are notorious dumping grounds for coins that dealers and collectors are looking to unload, ie. undesirable specimens. There seems to be an obvious dichotomy at play.

JCMhouston

I collect mainly World coins which are not exactly the same, but auction results are the main thing I look at when deciding what to pay for a coin. In Heritage auctions this week I wound up going 4 for 7 that I bid on, all the bids were at least 50% over price guide prices. My actual winning bids ran from 70% of guide price to 150% of guide price, but were in line with auction prices over the past 1-3 years. With commonly traded coins there should be plenty of auction records available and this would tend to provide the most value to me, although in a period of rapidly falling or rising prices even auction prices tend to get outdated quickly.

And especially for rare coins (say less than 50 known) book price and auction records may both be pretty meaningless since enough of them may not be available to have even a price trend established. I pay the same whether it's a major auction, a dealer, or a collector. I bought another piece this week for about 50% over "book" price from an individual. It's a 204 year old coin, the highest graded (pop 1/0), and in the top 3-4 pieces in the condition census. He set a price, and I paid it.

Steve

Interesting discussion. Real Value in MY mind develops over time. It is not just a point in time. As a Lincoln cent collector for 27 years now I recognized early on that coin buying and coin selling had TWO values, a retail (high) and a wholesale (low). During my accumulating years i was buying primarily at high and selling my duplicates at low. But I was in it for the LONG haul. My costs ultimately wound up to be based on 1980 and 1990 values and today my coins are valued significantly higher. I personally enjoy owning my coins and that has current value to me also. When I do sell, I am sure I'll still be ahead financially, but that has never been my prime reason for being in this hobby. So, while I do understand why investors can enjoy and profit from timing the market regarding buying and selling particular series at the right time, they must also realize that EVERY transaction has a buyer and seller. The buyer wants to pay the LEAST for the coin and the seller wants to receive the MOSt for the same coin. At that point in time the real value will be the negotiated price or auction price, BUT, if you look at the real value over time (at least ten years) you can generally expect that real value to be higher on the scarce coins discussed here. The scarce coins of the 70's were worth more than the same coins were in the 50's. The scarce coins of this past decade are worth more today than the same coins were worth in the 90's and earlier. In my opinion, people like Stewart Blay who is a true collector, has confidence in the ultimate true value of his coins and doesn't worry about the PCGS color guarantee because (1) over a long period of time he has gained experience in evaluating coins and (2) he has seen and experienced how over a long period of time the real value of scarce and top quality coins has continued to increase significantly. JMHO. Steve