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Does rarity/scarcity really add a premium?
hchcoin
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Here are examples of the last two so called "scarce/rare" bust coins that I have bought:
1836 B4 R4 ($135)
1835 B8 R4 or R5 (depending on the book you are looking at) ($118.50)
According to the bust quarter books an R4 is very scarce with 76-200 known and an R5 is Rare with 31-75 known.
How could these coins be selling at a price similar to a common die marriage? If you told me that a coin with only 75 known could be had for less than $120 in VF I would have said you are crazy. If you told me you could buy a coin with only 200 known in F for $135 I would have said you are crazy. BUT...... it seems to happen all the time. Is there a lack of demand for early coins? I honestly think that bust half dimes, dimes and quarters are a great and affordable way to collect rare coins. I also wonder if the lower end of the market is overlooked by todays high rollers leaving the VF and below grades ripe for the picking. I also believe it is much harder to find bargains for bust halves because they have a much broader collector base.
What say you? Am I missing something here? Are today's VF and below bust coins (half dimes, dimes and quarters) the stars of the future? What about seated coins? Is it only a matter of time till we see a new book on the series and they become the stars of tomorrow?
Thanks in advance for your thoughts
1836 B4 R4 ($135)
1835 B8 R4 or R5 (depending on the book you are looking at) ($118.50)
According to the bust quarter books an R4 is very scarce with 76-200 known and an R5 is Rare with 31-75 known.
How could these coins be selling at a price similar to a common die marriage? If you told me that a coin with only 75 known could be had for less than $120 in VF I would have said you are crazy. If you told me you could buy a coin with only 200 known in F for $135 I would have said you are crazy. BUT...... it seems to happen all the time. Is there a lack of demand for early coins? I honestly think that bust half dimes, dimes and quarters are a great and affordable way to collect rare coins. I also wonder if the lower end of the market is overlooked by todays high rollers leaving the VF and below grades ripe for the picking. I also believe it is much harder to find bargains for bust halves because they have a much broader collector base.
What say you? Am I missing something here? Are today's VF and below bust coins (half dimes, dimes and quarters) the stars of the future? What about seated coins? Is it only a matter of time till we see a new book on the series and they become the stars of tomorrow?
Thanks in advance for your thoughts
0
Comments
Link to 1950 - 1964 Proof Registry Set
1938 - 1964 Proof Jeffersons w/ Varieties
<< <i>Does rarity/scarcity really add a premium? >>
If there are 75 of a particular variety known but only 5 or 10 people who want one, is that item really scarce/rare?
<< <i>It's basically about supply and demand. There may be 75 known of a particular variety, but if there are only a handful of bust quarter collectors by variety, the supply may adequately meet the demand so prices stay low. >>
That's what amazes me. I would think collectors would be all over these series once they know the rarity of the coins.
Another series that amazes me is colonial coins. I was walking the floor at an ANA convention once and asked a dealer if they had any. He said no and I replied that they are so rare. He replied with a smile, "not as rare as colonial collectors"
<< <i>
<< <i>Does rarity/scarcity really add a premium? >>
If there are 75 of a particular variety known but only 5 or 10 people who want one, is that item really scarce/rare? >>
I really don't collect V nickels but if the 1913 was presented to me at an unbelievably low price, I would buy it (if I had the funds). My point is that these rare bust and seated coins are being passed up on a daily basis at such low prices (in my mind). I would think the rarity would drive the demand but I just don't see it. That's why I love the series. So many hidden treasures in my mind. Stone has proven that to me with his cherry picking skills.
Eric
It is hard to believe that demand is so low as to keep the prices down.
Maybe your thread will create a bump up in the market when you wake a few sleepers.
"If I say something in the woods and my wife isn't there to hear it.....am I still wrong?"
My Washington Quarter Registry set...in progress
That's an old joke that goes, the only thing rarer than your coin is someone who wants to buy it.
<< <i>I started a half dime proof collection, then realized that I would never be able to afford to complete it. Possibly in the MS I might have been able to finish the set. Somehow, completing the set was important to me. >>
Were you pursuing coins from before 1858?
<< <i>I really don't collect V nickels but if the 1913 was presented to me at an unbelievably low price, I would buy it (if I had the funds). >>
But people apparently aren't buying the coins you're talking about when they have the opportunity. Maybe there's a conclusion to be reached there?
<< <i>My point is that these rare bust and seated coins are being passed up on a daily basis at such low prices (in my mind). I would think the rarity would drive the demand but I just don't see it. >>
Different people are interested in different things. In this case, it looks like the market in general is not in alignment with your opinion regarding rarity, not that there's anything wrong with that. You should, of course, decide for yourself what's worth buying.
Looking for Top Pop Mercury Dime Varieties & High Grade Mercury Dime Toners.
Obscure 19th Century series contain numerous years (not varieties) with PCGS total pops under 40 in all grades. Without a sufficiently large collector base assigned values don't reflect their true rarity/scarcity.
https://www.pcgs.com/setregistry/gold/liberty-head-2-1-gold-major-sets/liberty-head-2-1-gold-basic-set-circulation-strikes-1840-1907-cac/alltimeset/268163
<< <i>The problem with those coins is the grade they're in...not to mention the fact there are WAY fewer BQ variety collectors than there are CBH variety collectors. You really need an R5+ in those grades to start to get a real premium. >>
Your point is exactly what I don't understand. If the XF and better coins command a premium, why not the lower grades? It just doesn't make sense to me.
1883 CC and 1884 CC Morgans in MS 65 are not rare coins, but try getting a decent one for $300. Everyone wants them.
Compare the 32 S and D quarters in F-12 and MS 63. Everyone wants the Uncs., while you can pick up the F-12 for I am guessing $150.
"Seu cabra da peste,
"Sou Mangueira......."
<< <i>
<< <i>The problem with those coins is the grade they're in...not to mention the fact there are WAY fewer BQ variety collectors than there are CBH variety collectors. You really need an R5+ in those grades to start to get a real premium. >>
Your point is exactly what I don't understand. If the XF and better coins command a premium, why not the lower grades? It just doesn't make sense to me.
I used to be convinced the same way you're thinking, until I just learned by experience, more or less. The collectors of varieties simply want the nicer, higher grade examples...I mean, if you had an OK looking VG/Fine coin like you posted and it was an R6+ with 15 known, then heck yes there's going to be a premium, but there just aren't enough collectors to run up a premium on that R4.
In other words, a mojority of the folks looking for a specific coin or series must be willing to pay the "premium". Otherwise, its just another coin.
The name is LEE!
<< <i>If you told me that a coin with only 75 known could be had for less than $120 in VF I would have said you are crazy. If you told me you could buy a coin with only 200 known in F for $135 I would have said you are crazy. >>
I would've said they were Darkside
Amat Colligendo Focum
Top 10 • FOR SALE
<< <i>Most people don't put in the research time to collect by die marriage. I doubt that will change any time soon.
>>
isn't this what has happened to stamp collecting? The number of persons collecting stamps has diminished over the years and therefore I understand that despite inflation there has actually been a drop in price for stamps that were once rare and sought after by collectors.
<< <i>
<< <i>The problem with those coins is the grade they're in...not to mention the fact there are WAY fewer BQ variety collectors than there are CBH variety collectors. You really need an R5+ in those grades to start to get a real premium. >>
Your point is exactly what I don't understand. If the XF and better coins command a premium, why not the lower grades? It just doesn't make sense to me.
Maybe someone has already commented on this point, but what i have seen is the lower grade coins don't get submitted to the top grading services and thus simply do not get into the population reports. I know this happens with moderns where you can look at the pop reports for a coin that was minted in the millions but has hardly any graded coins below MS 64.
Depends on the coin and the market and when it comes to market and who sees it when it does; and who wants it, if it does.
I collect shield nickel varieties, which are in low demand. (Good, more for me, at cheap prices.) I own URS-1 coins for which I paid only hundreds. Plenty of other coins with much higher populations go for thousands due to demand.
Example: 93S dollars aren't rare. You can find one anytime you want. But demand is high, so the price is high.
http://www.shieldnickels.net
<< <i>Example: 93S dollars aren't rare. You can find one anytime you want. But demand is high, so the price is high. >>
Perfect example. Similar example with Bust material ... an 1815/2 CBH is an R2 (common), but commands around $4000-5000 for a nice VF. A common coin in high demand. There are numerous R5 die marriages in VF that command far less, but there are few people who collect CBH by die marriages relative to those seeking an 1815/2 for a date set or Red Book set.
See http://www.doubledimes.com for a free online reference for US twenty-cent pieces
So far as die varieties an R-4 (76 to 200 est. known) can be a big deal in large cents and even half cents IF THE COIN IS NICE. For any of the early silver or gold coin varieties, it's no big deal at all because there are not enough collectors to drive the demand. I think you really have to get to an R-6 (13 to 30) before there is any real impact for rarity.
In addition the coin usually needs to be at least a VF, preferably better or much better, to get a lot of collector interest and high prices for the silver pieces. Having been though the experience with half cents, buying a very rare coin in lousy condition (And I mean LOUSY, like corroded ground salvage or Poor through AG-3) is not satisfying, at least not to me. I'm not a "Mint State snob," but usually a coin has to grade at least Fine or preferably VF to please me.
Best example I can think of, for a higher price for the low end grades, is the 1807 Bearded Goddess CBH. Several thousand dollars for a VF.
Top Pop is AU 55-last sold for 42,000 in 06. PCGS shows only 9 coins have sold at auction.
<< <i>
<< <i>Example: 93S dollars aren't rare. You can find one anytime you want. But demand is high, so the price is high. >>
Perfect example. Similar example with Bust material ... an 1815/2 CBH is an R2 (common), but commands around $4000-5000 for a nice VF. A common coin in high demand. There are numerous R5 die marriages in VF that command far less, but there are few people who collect CBH by die marriages relative to those seeking an 1815/2 for a date set or Red Book set. >>
Thanks for all the great responses. This one by astrorat really made sense.
northcoin - your response is scaring me
<< <i>Rarity and Scarcity have nothing to do with an actual "premium" unless it's applied toward a popular coin or series of coin.
In other words, a mojority of the folks looking for a specific coin or series must be willing to pay the "premium". Otherwise, its just another coin. >>
This is especially a problem with tokens and medals. The demand tends to be much less "specific". Rather
than desiring to own the only known token from Eaton Rapids, Michigan they merely desire to acquire MI
tokens and especially rare ones. So as the price is bid higher everyone drops out a very low level. A scarce
token they don't have is as valuable to them as a unique token.
Rarity is always of great importance to collectors but it's not always worthy of a significant premium.
This is also one of the problems with moderns since most collectors desire Gems but will settle for the best
that is easily found or meets some minimal standard (often chBU).
The first is that I don't believe the rarity ratings for some of the small-size bust quarters. The census numbers come from enthusiasts who have the variety in their collection, but they usually don't include all the dupes floating around on the open market. I'm more willing to believe the census for the large size quarters, since R5 coins are few and far between on the market, leading me to believe that most are held by variety collectors.
The 1819 B-1 is an exception, but I don't think it's R5, maybe a low R4. I think all legit R4/better large quarters command a decent premium in no-problem Fine and better.
The second issue is fresh collectors being spurred on by the relatively recent arrival of new quarter books. I've met 4 so far and they were all much more interested in the large size quarters, because let's face it, they are cooler. This has caused the supply of R4/better large quarters to almost completely dry up. The only ones available are in low grade or very expensive.
I have a feeling that the time will come when the new collectors move beyond the large quarters and then you may see spare inventory of scarce small-size varieties leave the market.
So buy em in the meantime!
Matt
I do think that of all the kids that are currently or recently plugging state quarters in to albums and then going to college, some percentage will someday become serious coin collectors, some smaller subset will focus on older coins, some even smaller group will collect bust quarters, and some still smaller minority will choose to form sets of early quarters (and other coins) by die variety. I think half dollars (particularly capped bust) and early copper lead the way in die variety collecting, but the others are catching on.
On our own board here, we have variety specialists in half dimes, dimes, early quarters (I'm among those, focusing on the large-sized for the reasons mentioned) draped bust halves, shield nickels, early gold, trade dollars, you name it, including a large proportion who collect more modern coins in rare ultra grades.
The fact that these early varieties are rare in an absolute sense is part of what I find fascinating about them, the other thing is that the really worn ones actually did the economic work of our country when it was young, having been actually spent hundreds and thousands of times by an equivilant number of real people who are long gone. You still have to get past how ugly they are compared to modern perfection, but fortunately for budget-collectors, the flaws help keep them affordable.
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