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Best ideas for losing money in coins
RYK
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A common newbie thread on coin forums is for the uninitiated to pose to the forum the question of how to make money buying, selling, investing, speculating, and or collecting coins. Well, Warren Buffett once said, "The most important thing about making money investing is not to lose money." (Paraphrased)
With that in mind, perhaps the forum establishment can offer up some ideas in the coin hobby/business/realm to the numismatic unwashed masses that are veritable locks to lose money.
I am going to sign off and chill out to the Furthur concert from 10/06/12, which is perhaps the best set list I have ever seen, bursting with my Grateful Dead favorites...so, goodnight!
With that in mind, perhaps the forum establishment can offer up some ideas in the coin hobby/business/realm to the numismatic unwashed masses that are veritable locks to lose money.
I am going to sign off and chill out to the Furthur concert from 10/06/12, which is perhaps the best set list I have ever seen, bursting with my Grateful Dead favorites...so, goodnight!
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Buy anywhere, sell at the local pawn shop, or hotel buyer.
Buy low value raw coins at retail prices. Markup on these is often astronomical in terms of percentages (eg: nicer common wheat cent might retail for $1.00 and have a wholesale value of 5 cents or 2 cents).
Buy any kind of problem coin at typical retail dealer asking prices. Go ahead and try to sell them to another dealer (or even the same dealer), and the term air pocket comes to mind.
Buy coins from unknown sellers on Ebay (or worse Craigslist), shopping mostly for price. After a year, a novice buyer will likely have acquired a decent percentage of fakes, even if buying slabs.
There's lots more. Lots of ways to lose and quite a few ways to lose big. Not so many ways to win unless a person is interested in being a part-time dealer or spending an equivalent amount of time and energy on their "hobby" (aka as a second job).
Like the "godless" dollars or "extra leaf" quarters when they were really hot and showing up on ebay for moon money.
Same with any series that's really hot when you buy it.
Of course like anything else with a bubble price you feel like you better buy it fast before it gets higher but more often then not the bubbles burst.
This has not happen to me thankfully, but I know of two instances where it has.
Click on this link to see my ebay listings.
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire
Buy odd looking raw,-- trade,seated and bust dollars on ebay.
Note to self: Never pay over double face for circulating coinage
1. Buy high, sell low
2. Buy MS 70 / PF 70 mods priced way above sheet
3. Buy big ticket coins for huge premiums over bid
4. Sell into a down market because your broke and spent too much money on coins.
5. Buy coins financed by credit card debt you cant pay off quickly or at all
6. Getting an ego about having a big inventory.
Remember, not everyone is not crazy about coins like you. Coins are a hobby, not investment commodities like stocks, and can be a long hold. They do not pay dividends or interest nor a high demand thing like food, gas, lodging, or electronics. A friend who could put $2000 a month in coins puts it mainly into women he meets up off sites like seeking arrangement. He is having the time of his life. While he keeps a minimal inventory of around $10,000 on his website (retail) and a residual amount of cash for any buying deals he simply is not addicted to spending money on coins. As a Project Engineer, his main investment money goes to his 401K plus silver and gold EFT funds along with a substantial amount of bullion coins in his SDB. A 1998 bankruptcy after being over extended in coins ($100 K credit card debt) taught him a lesson. He keeps up with numismatics and will hit the show circuit when retires he says.
It can be tough selling numismatic coins for a decent profit with the CDN oriented buying environment at shows. I know myself I will eventually get my price in retailing my material. One has to be patient and not over extended. I have moved coins at the same show I set up at, two weeks later on the bay, or in some instances had to hold them ten years before I finally got my price.
<< <i>To lose money in coins:
1. Buy high, sell low
>>
That's my vote. Works every time and no income tax to pay.
At least if you buy something in a PCGS slab, you have a much better idea it was not cleaned, artificially toned, damaged, modified, or counterfeited -- and have a better idea of it's rough market value. If you buy stuff with eye appeal, you will do MUCH better.
Do watch out for counterfeit PCGS slabs though.
It's a snake-pit out there.
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No Way Out: Stimulus and Money Printing Are the Only Path Left
Done this....quickly purchased a cheap one from the supply vendor.
(2) Failing to recognize that all coins of a grade are not created equal. Even if properly graded, eye appeal is paramount. Those "bargains" likely aren't bargains after all.
(3) Relying on price guides, including online guides, without looking at recent auction records (or relying on just a couple of sales without a larger pricing history). Even good quality price guides cannot provide real time pricing, and a coin's price can vary tremendously among similarly graded pieces.
(4) Another harmful trend is for novices to buy white dipped out coins.
There are countless examples to talk about.Sometimes the bigger fool will come along and save you but it should not be counted on.
Whoever is careless with the truth in small matters cannot be trusted with important matters.
``https://ebay.us/m/KxolR5
The biggest financial mistake I ever made in coins echoed this thought. I passed on the cameo 1804 $10 because the seller wanted too much over bid ($580k bid, $750k price). Little did I know at the time that bids are just sitting there for years until a coin actually changes hands at whatever the new real price is. Imagine my chagrin when it sold for $5M about five years later!
Whether you're buying $50 coins or $5000 coins, if you can't tell when something has been cleaned, overdipped, puttied, AT'd, or overgraded, you're toast.
After you get home, go on eBay and buy some "Choice BU L@@K" Seated and Bust coins on eBay for MS64 prices. Don't worry, they will all make MS65 at PCGS anyway. Get some uncertified Seated and Trade Dollars, too, especially those dated 1846-CC. Silly, clueless eBay sellers don't know what they have. Then go over to the gold section and buy every last uncertified Liberty Head and Indian coin you can find from sellers with low feedback. They're surely authentic US mint products, so just throw them in your safe deposit box and don't bother to check for 5-10 years. They cost less than PCGS coins, so you will save a lot of money.
Thinking you're going to make a lot of money in coins right off the bat is delusional. Newbie coin collectors are goldfish in a shark tank.
Have you ever wondered why there are so many expensive and so-called "rare" coins for sale at any given time?
For many a coin,rarer than the coin itself,is a buyer at a level where serious money is not going to be lost by the seller.
Whoever is careless with the truth in small matters cannot be trusted with important matters.
Lafayette Grading Set
<< <i>Pay retail. >>
No chit Cherlock. There are smoe dealers that if you buy from them, you will be immediately and probably permanently under water on the coin. It is always possible to lose money even with nice coins simply due to market conditions.
One should only keep coins that one really likes.
If there was a simple answer wouldn't we all be rich.
<< <i>Pay retail. >>
Actually some of the coins I have made the most money on I had to pay full retail and in a few cases a premium over on. Sometimes quality trumps what is perceived as the price.
<< <i>Buy raw pre-1933 U.S. gold coins, especially from flea markets venders. >>
This also applies to expensive key date coins that are frequently counterfeited such as 1909 S VDB cents and 1916-D dimes.
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire
<< <i>Original is best, stay away from cleaned coins or altered surfaces. >>
I approve of this notion!
<< <i>
<< <i>Pay retail. >>
Actually some of the coins I have made the most money on I had to pay full retail and in a few cases a premium over on. Sometimes quality trumps what is perceived as the price.
Agree with this. I would amend to "pay retail, then try and get your money back right away from a different party, or the same dealer." If you're lucky, in a short period of time, you may break even-ish. Over a longer period, the market may help, hurt, or remain indifferent to you. I bought a no motto PCGS-63 Saint for $505 a few years back, and that was "retail". A couple years later I sold it for like $1400 to another dealer. The bull market for gold, and pure luck, helped me out. Did I do OK buying at retail in this instance?
Another coin I paid retail for once is a nice 1892-0 half in F-15 for $150 that I still have. Am I doing OK on that one?
Coin Rarities Online
<< <i>Paying a price so high for a piece that the only way out of it is to find the bigger sucker. Believing what your dealer tells you without subjecting it to the logic test. Passing on a nice coin because it doesn't have a sticker on it. Paying 5 years from now (maybe) prices because they might go up and you are told you have to pay that now to get them. >>
I like these points, David!
Actually some of the coins I have made the most money on I had to pay full retail and in a few cases a premium over on. Sometimes quality trumps what is perceived as the price.
I couldn't have said it any better myself.Money isn't made and lost by over-analyzing numbers on a pieces of paper or computer screens.
Whoever is careless with the truth in small matters cannot be trusted with important matters.
-Ignore due diligence by not at least checking auction archives for sale of same or similar coins.
-Buy coins without first educating yourself on the series.
-Put coins away in your SDB without studying them first.
-Don't ever try to sell anything.
-Ignore concerns regarding counterfeit coins and/or holders.
-Don't ask questions.
-Don't ask questions.
-Don't ask questions.
Empty Nest Collection
<< <i>I think the Coin Vault can help you achieve such goals. >>
with no knee grabbing. there good at it
<< <i>
<< <i>I think the Coin Vault can help you achieve such goals. >>
with no knee grabbing. there good at it
I am not here to defend Coin Vault but I do think if you are careful and know your stuff you can get a decent deal there occasionally. Now HSN I do not think so. Those gold plated state quarters are really a risky buy.
"Keep your malarkey filter in good operating order" -Walter Breen
<< <i>Purchase superb Deep Cameo Proof Franklin Halves from the market maker who advertises extensively in the coin trade publications at overly inflated prices!
I agree!
I'll add a couple more:
1) Don't get enamoured with First Strikes, Early Strikes, etc. and pay large premiums for them
2) Don't rush out to buy PR70's or MS70's within a few years of issue. Most go down dramatically over time.
3) Don't buy coins you know nothing about - do some market research first.
4) Don't trust the lower class third party grading services
“In matters of style, swim with the current; in matters of principle, stand like a rock." - Thomas Jefferson
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<< <i>buying from anyone living in China >>
Why?
To make some money like the wizard of Omaha:
-have a long-term time horizon and commitment.
-buy coins with limited supply and steady long-term demand (easier said then done at times).
Website-Americana Rare Coin Inc
<< <i>
<< <i>buying from anyone living in China >>
Why? >>
A very high number of counterfeit coins are coming out of China including counterfeit slabs.
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire