To what extent will you "stretch" for the right coin?
AnkurJ
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During the last two months, two type coins have been offerred in the market at auction that I desired to add to my collection. One was an upgrade, and other was a key that is rarely offerred in affordable grade. In both circumstances, I was outbid, and lost the auction. In one example, I regreted not bidding more. Bidding live on the phone and during the heat of the moment, I decided not to go above my preset max.
In another recent example, I bid my max in the online bidding, and expected it would be enough to win the coin. Wrong. There was one more bid placed, and put the coin in a price close to the next grade. In this case, I had no regrets as the coin went for strong money. What surprised me is a dealer purchased the coin, and has resold it for a profit. So I may have been wrong, but oh well.
So what brings me to my question for everyone. When a coin you have been looking for is up for sale, to what extent will you stretch? To the next grade? Do you have a problem setting a record? (Hi Bruce
)
Ankur
In another recent example, I bid my max in the online bidding, and expected it would be enough to win the coin. Wrong. There was one more bid placed, and put the coin in a price close to the next grade. In this case, I had no regrets as the coin went for strong money. What surprised me is a dealer purchased the coin, and has resold it for a profit. So I may have been wrong, but oh well.
So what brings me to my question for everyone. When a coin you have been looking for is up for sale, to what extent will you stretch? To the next grade? Do you have a problem setting a record? (Hi Bruce
)Ankur
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Unfortunately, I do not care for the recoil.
In all seriousness, I think that if you are not comfortable, don't do it. I have paid "record prices" for relatively mundane items and have rarely regretted it because I understand the coin, the market, and its value to me. Plus, I am not squandering the mortgage payment.
No matter what, don't kick yourself for passing. "One door closes, and another one opens."
And yes, if the coin is nice----I would pay up to or at least NEAR that next grade. If it gets too close---I would just as soon have a higher graded coin but a nice one in the next grade up will cost you a premium, as well. I currently only have ONE coin in my set that is real near that next grade level in price----I had to have it and I got caught up in 'auction fever'. Sometimes, I regret it a little but it is still a super PQ special piece.
Sometimes I've paid moon money and other times I've gotten really lucky and paid little. It is the yin and yang of the hobby--I guess. Sometimes, we breakeven overall and sometimes were even well ahead.
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There's a difference between paying AU58 money for an AU53, and buying a coin at a price three times higher than you've ever spent for a single coin.
RMR: 'Wer, wenn ich schriee, hörte mich denn aus der Engel Ordnungen?'
CJ: 'No one!' [Ain't no angels in the coin biz]
<< <i>i have found that id rather spend years enjoying a coin i overpaid for than spending years kicking myself i the ass for not bidding high enough. >>
Well said.
Someone who I hold very highly in numismatics has told me to be patient. Since I am young, as are a good number of collectors here, I will get another chance as many collections will be offerred during my collecting years. Lets just hope the price hasn't doubled!
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<< <i>i have found that id rather spend years enjoying a coin i overpaid for than spending years kicking myself i the ass for not bidding high enough. >>
I really have to disagree with the above. If you overpaid for something, you paid too much for it. Period. You're buried in it; you made an expensive mistake.
That's different than paying what for you is a lot of money for a coin, but is an amount you believe to be reasonable for said coin. I know what a nice for the grade coin I am looking for should cost, and will pay a premium - but not a huge one - for a really nice coin. But my max bid is my max bid. I have been an under-bidder on a nice coin many times, and I have absolutely no regrets not getting the coin.
I PMed a forum member we all know about a coin which to me was the most impressive I've ever seen of a particular series. I put in my max bid and bidding went higher. I could have outbid the winner's bid on the coin, but I declined to do so. Why? Because it cost more than I thought it was worth. Keep in mind that I will never see a coin in this series as nice as this one again. I don't care.
I collect coins with discretionary funds. If I can think I can put $X to better use than buying a particular coin, I don't buy said coin. I have been collecting coins on and off for the last fifty years. I have never seen a coin that I absolutely had to own, and I never will.
Re how much of a premium? It depends. I collect business strike Liberty Nickels in PC 6 holders. If you can find a particular date in a 7 holder, they often go for 3X their counterpart in a 6 holder; sometimes more. Making a 7 is something I don't have the patience to deal with; it's beyond difficult in this series. So no way will I buy a particular dated Liberty Nickel in a PC 6 holder and pay half way to 7 money. That's a guaranteed way to get buried in a coin, which per my first paragraph, is making an expensive mistake.
"Seu cabra da peste,
"Sou Mangueira......."
If you lose by an increment, you lose by an increment - it hurts at times, but that's what my tuition has taught me.
Pretty darn far after 15-20 years. No regrets.
I would stretch much, much further to get my mom's health back tho.
Best,
Eric
<< <i>
<< <i>i have found that id rather spend years enjoying a coin i overpaid for than spending years kicking myself i the ass for not bidding high enough. >>
I really have to disagree with the above. If you overpaid for something, you paid too much for it. Period. You're buried in it; you made an expensive mistake.
That's different than paying what for you is a lot of money for a coin, but is an amount you believe to be reasonable for said coin. I know what a nice for the grade coin I am looking for should cost, and will pay a premium - but not a huge one - for a really nice coin. But my max bid is my max bid. I have been an under-bidder on a nice coin many times, and I have absolutely no regrets not getting the coin.
I PMed a forum member we all know about a coin which to me was the most impressive I've ever seen of a particular series. I put in my max bid and bidding went higher. I could have outbid the winner's bid on the coin, but I declined to do so. Why? Because it cost more than I thought it was worth. Keep in mind that I will never see a coin in this series as nice as this one again. I don't care.
I collect coins with discretionary funds. If I can think I can put $X to better use than buying a particular coin, I don't buy said coin. I have been collecting coins on and off for the last fifty years. I have never seen a coin that I absolutely had to own, and I never will.
Re how much of a premium? It depends. I collect business strike Liberty Nickels in PC 6 holders. If you can find a particular date in a 7 holder, they often go for 3X their counterpart in a 6 holder; sometimes more. Making a 7 is something I don't have the patience to deal with; it's beyond difficult in this series. So no way will I buy a particular dated Liberty Nickel in a PC 6 holder and pay half way to 7 money. That's a guaranteed way to get buried in a coin, which per my first paragraph, is making an expensive mistake. >>
In principle I have to agree, but there are exceptions. I was an under bidder on some of the less expensive gold bars that were auctioned from the original SS Republic sale. Now those "less expensive" gold bars have an astronomical price. Same with several lower grade 1794 dollars that I bid on in several different auctions during the same time frame. At one increment higher I would not have overpaid for either but who knows how much more the winning bidder might have continued upping the ante if I kept increasing my bid to beat his?
There is one particular coin though, that if I found it, I'd buy it, whatever I had to do to afford it. Generic versions of this coin are as common as snow in Alaska, but the one that I'm after has certain attributes that make it a rare thing indeed.
I bought my 1901-S barber quarter just in time before the big price rise. I wanted a 1916 SL quarter but decided to wait--Well dummy me, the price sky-rocketed from $2100 to $8K or more almost overnight. I know most people think that the 1916 SL quarter is overpriced, BUT no one has one to sell at a price they think is reasonable. If you want a coin you have to pay the going rate.
If you don't buy it, someone else will.
Bob
Realone: maybe I should clarify as I'm NOT talking about pedigrees, rare varieties, or grade rarities. I'm talking about general scarcity of type and of key dates. The former is thinly traded in many cases, and a very small percentage of people may be willing to stretch.
Bryce: I agree 100% that patience is a must in ANY field of collecting.
One coin I am trying to buy in AU is an octagonal pan pac. They seem to have doubled in all grades over the last 10 years! Will it continue? Who knows? But it's one coin I will stretch for and sell others if I have to.
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a professional hit man who collects rare stamps. He struggles with this very question.
He paid $18,000 for a stamp that had a book value of $8500.
He rationalizes the purchase to himself because he picked up a bonus for a hit. In another
case he frets that he will miss the morning session of an auction to set up a hit in NY City.
He specializes in Colonial stamps up to 1940 and he helps a couple of widows
sell collections, one of which is quite valuable. He is quite methodical in both
his profession and his hobby.
I knew it would happen.
(Except for the don't kick yourself for passing part...I've been known to do that occasionally.
No stretching for me.
But I wont stretch beyond my financial means . Like getting a loan or something to purchase it. (although there have been a couple I would have liked too!)
Now, the truly rare once in a lifetime stuff? That's different - because most of the time the record price you pay becomes the new baseline for its value. Is it ever really a stretch if you don't really overpay? Take the 1794 dollar for instance. I knew that if we paid less than $10M, the coin's true value might never be recognized. But if we stepped up and paid the big number, it would never go below that value again (barring a major market crash). Was it a stretch? Not in my opinion!
I have stretched to book x 2 or book x 3 for certain coins in certain series. In other series I want the coin to be "all there" and still expect a discount. As was stated, it depends.
For a coin that is hardly ever available, I always try to remember that I may be competing against at least one other bidder---with deep pockets. Deep pocket bidders have actually caused me to lower many of my max bids, because I know bidding against them is useless.
I know that I can't afford with buy a million dollar coin without making MAJOR sacrifices which would make such a purchases extremely foolish for me at this point. For that reason I admire there ultra exclusive coins, but don't feel slighted or tempted to reach. On the other hand, there is a level that makes me very tempted to stretch a bit.
I think in the end it is a financial decision first for almost everyone. Can I legitimately afford to spend whatever on this discretionary item, be it a coin, car, home, guitar...? After the financial implications are weighed it's easy to stretch and becomes more about desire and personal value than financial sense. I'd much rather spend $2000 on something I love (with a "value" of $1000) than $1000 for a $2000 item which I have no need for.
I'd bet we all kinda collect at the level we can collect. I doubt that TDN would be satisfied collecting circulated lincoln penny's. It's fun to play $5/hand blackjack until you get used to playing for a higher stake. Than the $5 game gets awfully boring.
Two coins come to mind from my collection that were both bought and sold years ago. My 1915-s Lincoln, and my '55 DDO. Both coins were incredible examples.
The '15-s was a 65RB with a 66RD obverse and a 65RB reverse. At the time the price guide said $2850 and I paid $4500. When I went to sell the set, a few coins got pulled out for special consideration. I mean, out of about 150 coins, there were only three or four that made the cut and got sent out to a collector. He saw the '15-s and immediately agreed to my price of $9000.
The '55DDO was a 64RD whose only detriment was the slightest mellowing of the color. Other than that, it was simply the best '55DDO I had, or have ever seen. I paid $13K, another record price for the issue/grade. When it came time to sell (one of my few regrets in numismatics) it was sold to another set collector for $16K. He whined a lot about it, but when he got it, he told me the same, that it was the best '55DDO in any grade that he'd ever seen. I told him that I would like to buy it back someday. Not a chance.
I am fortunate enough to still own many other examples that I had to "stretch" for. One day, when I sell, others will have to as well.
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The rest of his material was up there too. He had an MS-67 graded scarce early commemorative dollar for which he needed $17,000. The coin had deep original toning with some less than attractive darker toned (black) areas on the edge. Since MS-66 bid was $2,875, I thought his number was a bid steep.
I had been offered by the OP to help me "stretch" for a coin I had wanted See this thread and I am glad I did. It was him, and a few others who convinced, and helped me to stretch.
Although I cannot help on this matter, I certainly would encourage you to "go for it", as opportunities to acquire harder to find coins will pass you by and you may regret it later on.
<< <i>Wellllllll, this is actually a tough question because it touches so many levels. I have always said that the best bargain in numismatics is a just missed it coin for the next grade - because the quality increment outweighs the price increment. However, if you stretch too far it's no longer a bargain and you could just as well buy the next grade up. But then again to assess this you would really need to know the absolute true market value for the coin in each of those grades. And frankly, most so called rare coins aren't so rare and opportunities to buy them come along all the time.
Now, the truly rare once in a lifetime stuff? That's different - because most of the time the record price you pay becomes the new baseline for its value. Is it ever really a stretch if you don't really overpay? Take the 1794 dollar for instance. I knew that if we paid less than $10M, the coin's true value might never be recognized. But if we stepped up and paid the big number, it would never go below that value again (barring a major market crash). Was it a stretch? Not in my opinion! >>
Thanks for sharing again on the topic of the 1794 dollar. Would you agree that there is a close analogy to a coin like that being compared to a rare and unique painting such as one of the Van Gogh Sunflower paintings(Vase with 15 Sunflowers) that Japanese buyer Yasuo Goto payed a then new record 39.9 million in 1987? At that time it was 4 times more than any painting had previously sold. If I recall correctly he had to take a huge loss on it during an economic downturn but I have not been able to confirm that. Reportedly it was at one time, if not still, exhibited in a museum possibly tied somehow to the buyer, The Seiji Togo Yasuda Memorial Museum of Art in Tokyo. Someone asked an art expert what its current value was, and his response was "Priceless." (On a side note, interestingly I was surprised to learn that there remains to this day some question as to whether the painting itself is a forgery.)
Paintings like this draw oohs and aahs from a wide swath of people. Coins? Not so much.
RMR: 'Wer, wenn ich schriee, hörte mich denn aus der Engel Ordnungen?'
CJ: 'No one!' [Ain't no angels in the coin biz]
Ballsy!
I give away money. I collect money.
I don’t love money . I do love the Lord God.
I collect coins with discretionary funds. If I can think I can put $X to better use than buying a particular coin, I don't buy said coin. I have been collecting coins on and off for the last fifty years. I have never seen a coin that I absolutely had to own, and I never will. >>
These two statements sum it up for me, I will not stretch as there will always be another coin. I can see where for those in the deep end of the pool buying coins that only come to light every 10 years or less and where there are limited numbers availible(think under 20 known here) where stretching might be the only option; but that applies to a very small number of coins.
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<< <i>lol you cannot be "buried" in something that only comes along every five years or so.. ive noticed that people are only as patient as thier wallet allows. >>
You can laugh all the way to the poor house if you wish. The coin I referenced in my earlier post I first saw six years ago and will never see anything like it again. The current owner is buried in it.
For the kind of coins that TDN seeks, you might have a point. But imo, anything else will show up again, sooner or later if you are patient enough.
"Seu cabra da peste,
"Sou Mangueira......."
van Gogh was a POST impressionist, and there are many sunflower canvases (14 all told?), starting with the about 4 from 1887 (one is in the Metropolitan) on to those in 1888 and '89. So, I don't know if this is a good analogy with the 94 1$
Eric
The second point, which is critical, is that you have to be honest with yourself about how well you know the coin and how well you know the market. Before I give you an example, here's the basic rule. The more you know about a really special coin, the more you should be willing to stretch, because you may very well appreciate it more than anyone else. And the less you know about the market, the more you should be willing to stretch, because your estimate of the value is just a guess.
Now, the example. Yesterday, I bid on an unbelievably nice Guatemalan Pillar One Real, far better than anything I had ever seen before. I knew enough to know that this was a coin I should be buying, and I knew enough to set an initial bidding limit. But when competition sent the price to almost double what I had in mind, I bought it anyway, because I knew two things. First, this is the type of coin that has mega-potential as an investment. Second, my initial limit was not much more than a guess at the true value, and I shouldn't take my guesses too seriously. Was it a burial? I don't know, but I'm convinced that it was a smart bet. And besides, I really wanted the coin, and now I'm happy!
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<< <i>First point, which I think is obvious but still needs to be stated, is that the more irreplaceable and fabulous a coin, the faster it is likely to turn from a "burial" to a financial winner. Therefore, assuming you've found the right coin, the longer you're prepared to hold it, the less you should worry about "stretching". (Conversely, if the coin is nothing special, time can turn a good deal into a bad one. But we digress!)
The second point, which is critical, is that you have to be honest with yourself about how well you know the coin and how well you know the market. Before I give you an example, here's the basic rule. The more you know about a really special coin, the more you should be willing to stretch, because you may very well appreciate it more than anyone else. And the less you know about the market, the more you should be willing to stretch, because estimate of the value is just a guess.
Now, the example. Yesterday, I bid on an unbelievably nice Guatemalan Pillar One Real, far better than anything I had ever seen before. I knew enough to know that this was a coin I should be buying, and I knew enough to set an initial bidding limit. But when competition sent the price to almost double what I had in mind, I bought it anyway, because I knew two things. First, this is the type of coin that has mega-potential as an investment. Second, my initial limit was not much more than a guess at the true value, and I shouldn't take my guesses too seriously. Was it a burial? I don't know, but I'm convinced that it was a smart bet. And besides, I really wanted the coin, and now I'm happy! >>
Great realk life advice.
Please show us a picture when you get a chance.
I give away money. I collect money.
I don’t love money . I do love the Lord God.
I would never stretch for an AU $50 PP. Wait and buy a 2 shot 3 or better 3 shot 4. I love this issue BTW.
K
My 1866 Philly Mint Set
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I once, some years later, paid double the 'market' price for a coin if you were going by past auction results. It was an AU58 coin, and it was better looking than any coin of that type AU50-MS63 that I had seen in the three years I was looking. That cost me much more than $50 extra, but I absolutely believe it was the right price. Wouldn't you know it though, a year later an even better example of that coin, also in AU58, came by. I didn't need to bid for it because I had mine (which I really like), but the winner paid about 25% more than I paid for mine, and I think the winner got an absolute beauty at a good price. Clearly at least 2 people thought that the "book" was wrong.
So stretching for a coin IMO isn't a question of amount, it's really a question of how you value the coin. We can argue whether coins have any intrinsic value at all. One of TDN's beauties would still only melt to $29 or so in silver. If you get past that, then if you're able to be happy with the purchase after the fact then I wouldn't worry with it. Helps if you're not buying the coin for a flip or buying the coin with money you need for essentials, neither of which I would advise people do.
-Fred
Successful BST (me as buyer) with: Collectorcoins, PipestonePete, JasonRiffeRareCoins
<< <i>First point, which I think is obvious but still needs to be stated, is that the more irreplaceable and fabulous a coin, the faster it is likely to turn from a "burial" to a financial winner. Therefore, assuming you've found the right coin, the longer you're prepared to hold it, the less you should worry about "stretching". (Conversely, if the coin is nothing special, time can turn a good deal into a bad one. But we digress!)
The second point, which is critical, is that you have to be honest with yourself about how well you know the coin and how well you know the market. Before I give you an example, here's the basic rule. The more you know about a really special coin, the more you should be willing to stretch, because you may very well appreciate it more than anyone else. And the less you know about the market, the more you should be willing to stretch, because your estimate of the value is just a guess.
Now, the example. Yesterday, I bid on an unbelievably nice Guatemalan Pillar One Real, far better than anything I had ever seen before. I knew enough to know that this was a coin I should be buying, and I knew enough to set an initial bidding limit. But when competition sent the price to almost double what I had in mind, I bought it anyway, because I knew two things. First, this is the type of coin that has mega-potential as an investment. Second, my initial limit was not much more than a guess at the true value, and I shouldn't take my guesses too seriously. Was it a burial? I don't know, but I'm convinced that it was a smart bet. And besides, I really wanted the coin, and now I'm happy! >>
This. many gems here.
Eric
<< <i>To what extent will you "stretch" for the right coin? >>
If I really want the coin, far. Very far. New record far.
But this presumes that I have sufficient expertise in the issue / type / series to know if a particular example is truly 'stretch-worthy'.
I would also add that I reject the notion that the price I should pay for such a coin should be influenced by the price (or price guide listing) of average examples in the same or similar grades, that are not particularly choice, or attractive, and which I have no interest in owning.
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There aren't any coins I just gotta have at any cost. Sometimes it's good enough just to have the chance to see them.