Enjoyable thread. I have been lurking for a bit trying to decide how to add my 2 cents. Workload, family, and life in general have drained me of deep waxings lately, so I will keep it simple. I suppose the I am stuck in the aforementioned "liquidity" conundrum. I still have an appetite for the hobby but I am having trouble finding buyers to raise funds to put back into the collection. I am at a place where the majority of funds available for purchases are generated when I can free cash from existing pieces in my collection. For the first decade of the millennium, eBay gave the average Joe like myself solid feet to buy and sell pieces in the middle market. Funds received was a function of the quality of the coin pictured in the auction rather than one's ability to haggle for respectable prices from brick and mortar owner or show dealer. eBay was the great equalizer. Unfortunately, the eBay balloon has been slowly deflating in recent years and I no longer can garner bids or even watchers for the same or better pieces. As a result, I sense that the small to mid size collector has lost some of the momentum. Sure, I can price at a 40% discount and find a quick buyer, but where is the incentive to do so? My only urgency is the desire to reinvest in new pieces. If I can't come close to recovering my initial investment, I just settle into a long term hold pattern. What is the best strategy to find buyers for respectable EF/AU material that is not capturing the hearts and minds of the glamorous auction houses and tier one eyes?
"Inefficient", does sound a bit of a euphemism and rationale for scorching the seller though. Our buddy at A---s is then likely efficient for buying high and selling far higher?
I really dislike it when there is a bit of hiding behind verbosity. And sticking to the OP, as others have said what is hot is what you're trying to buy as a collector, and what is not is what you might try to sell - even if it may actually be plenty hot. Have to say that like a lot of others, this has pushed me to sell at auction.
Love that Milled British (1830-1960) Well, just Love coins, period.
7Jaguars I believe we really see eye to eye. The inefficiency stems from the dealer profit expectation when compared with an auction. The only way to enable such spread is make discounted (firesale level) offers to justify tying up of capital with the hopes of a highly profitable resale. The best route is sell to a collector who will pay retail or near or auction which takes a chunk of the sale in commission and will not solve the immediacy issue yet hopefully that will be offset by the larger buyer universe compared with that of a more localized dealer. 3rd option is consignment to a dealer where his client base is relevant to the sold material. The fees there are far reduced as the dealer is not tying up capital.
As worldcoinguy indicated, eBay used to be the goto place yet has been tarnished by various factors. I have coins listed there at half of the price of what dealers or auctions fetch. That's inefficiency and disruption will come should entrepreneurs view the market as a long term proposition.
My definition for liquidity is therefore - "the ability to sell a coin within a reasonable timeframe at a reasonable price"
@worldcoinguy said:
Enjoyable thread. I have been lurking for a bit trying to decide how to add my 2 cents. Workload, family, and life in general have drained me of deep waxings lately, so I will keep it simple. I suppose the I am stuck in the aforementioned "liquidity" conundrum. I still have an appetite for the hobby but I am having trouble finding buyers to raise funds to put back into the collection. I am at a place where the majority of funds available for purchases are generated when I can free cash from existing pieces in my collection. For the first decade of the millennium, eBay gave the average Joe like myself solid feet to buy and sell pieces in the middle market. Funds received was a function of the quality of the coin pictured in the auction rather than one's ability to haggle for respectable prices from brick and mortar owner or show dealer. eBay was the great equalizer. Unfortunately, the eBay balloon has been slowly deflating in recent years and I no longer can garner bids or even watchers for the same or better pieces. As a result, I sense that the small to mid size collector has lost some of the momentum. Sure, I can price at a 40% discount and find a quick buyer, but where is the incentive to do so? My only urgency is the desire to reinvest in new pieces. If I can't come close to recovering my initial investment, I just settle into a long term hold pattern.
This perspective is interesting to me because I haven't been in the coin collecting world that long. Is your perception that the value of your coins has decreased to the point you don't want to sell them, or do you think that there are fewer people bidding on eBay? I find that the number of actual auctions of decent coins on eBay has decreased significantly, and most decent material is listed (and usually not sold) at fixed prices. There could be an argument made that there isn't a critical mass required to maintain regular bidding in some of the world coin areas.
My definition for liquidity is therefore - "the ability to sell a coin within a reasonable timeframe at a reasonable price"
Zohar, I wanted to chime in and agree with most of your points. Coming from the world of manufacturing, the way dealers treat inventory management and liquidity boggles my mind. Why would you have so much hold time on inventories that have a not insignificant likelihood of devaluing. I also notice that when I visit the same dealers at a coin show 90% of the coins will be the same and they only turn over about 10%. I've been looking at the same coins for 5+ years from some dealers. There is some expectation from customers that a dealer have a minimum inventory, but that seems like too long.
This perspective is interesting to me because I haven't been in the coin collecting world that long. Is your perception that the value of your coins has decreased to the point you don't want to sell them, or do you think that there are fewer people bidding on eBay? I find that the number of actual auctions of decent coins on eBay has decreased significantly, and most decent material is listed (and usually not sold) at fixed prices. There could be an argument made that there isn't a critical mass required to maintain regular bidding in some of the world coin areas.
My view (not speaking for worldcoinguy) is that once the credibility and buyers leave the platform, sellers protect themselves by setting high reserves. Years ago it was a viable outlet with 0.99c starting prices. Combination of low ethics, poor enforcement drove out buyers, leaving more commoditized material. Certain credible dealers use Ebay as a way to cost effectively acquire customers as the subsequent sales are done offline. A credible platform will bring in buyers and will enable free flow of goods. The arbitrage is so significant where at times a coins can be bought at 50% on Ebay compared to what it would fetch on auction. Shouldn't be this way in an efficient marketplace.
My definition for liquidity is therefore - "the ability to sell a coin within a reasonable timeframe at a reasonable price"
Zohar, I wanted to chime in and agree with most of your points. Coming from the world of manufacturing, the way dealers treat inventory management and liquidity boggles my mind. Why would you have so much hold time on inventories that have a not insignificant likelihood of devaluing. I also notice that when I visit the same dealers at a coin show 90% of the coins will be the same and they only turn over about 10%. I've been looking at the same coins for 5+ years from some dealers. There is some expectation from customers that a dealer have a minimum inventory, but that seems like too long.
If you are baking in a 20-100% profit expectation, it means that you will only buy at heavily discounted prices otherwise, remain liquid. Most dealers have VERY low overhead and I cant understand why such a profit target is warranted. The availability of transparent price discovery tool (auction records etc) will only put pressure on the markup, but also prevent set the proper price expectation in seller's mind.
To conclude - reduced liquidity (ability to sell at reasonable price) will limit purchasing in general. If you look at auction houses far more coins are listed with a high reserve price no different than Ebay. Create liquidity, market benefits.
If you are baking in a 20-100% profit expectation, it means that you will only buy at heavily discounted prices otherwise, remain liquid. Most dealers have VERY low overhead and I cant understand why such a profit target is warranted. The availability of transparent price discovery tool (auction records etc) will only put pressure on the markup, but also prevent set the proper price expectation in seller's mind.
To conclude - reduced liquidity (ability to sell at reasonable price) will limit purchasing in general. If you look at auction houses far more coins are listed with a high reserve price no different than Ebay. Create liquidity, market benefits.
Something I didn't mention that also affects this behavior is the availability of coins to dealers. If a lot of dealers reduced their prices and were able to sell coins faster, I don't know if they would be able to replace that inventory. The amount of product available to dealers may actually be insensitive to how much they are willing to pay for material. If that's true, then consolidation of the dealer market would enable smaller margins.
You'd think if dealers were working off of a 100% profit, then they'd be willing to negotiate more and take more loss on their expectations (not a real loss).
I should also mention in this thread that the commercial nature of this hobby has always been a source of grief for me. It seems like everyone involved in the hobby has some sort of profit incentive. There are a lot of hobbies where this is not the case. I know shouldn't be surprised considering this one is directly related to money. I enjoy talking about these trends, but it makes me a little sad that I don't see more trading, sharing, and cooperation.
The margin is higher at the higher end of the spectrum where the more mainstream coins trend at lower band. As you had noted, inventories are very thin (Atlas being a big exception). Actually if you look at Atlas - very much focused on the highest tier in terms of quality/scarcity - the guy works VERY hard to travel the globe hunting the best material AND maintain a very expensive inventory and staff. I bet most of his material is purchased in the primary market (auction/collector) and resold. The website is professionally managed as is the entire globally oriented business.
I assume such overhead and cost of capital buried in inventory can only be accounted for with higher margins at the account of reduced sell through and if a business utilizes its own capital to fund inventories and run a professional retail oriented business, they should be rewarded for their investments.
Are there other dealers that handle their business in such manner on the world coin side? Very few if any invest in the infrastructure at this level, including inventory. I therefore would think the margin requirements should be far more moderate. Your comment about replacement is spot on, as clearly finding the bargain for the firesale item and/or something that falls within the very narrow customer base they can immediately flip. Limited scope, capitalization for most is my observation.
Cladking brings up some good points that I will expand on.
Newbie/younger collectors tend to focus on "bang for the buck" and nice looking/interesting lower value coins. Right now, that feels like older world coins and ancients.
They simply don't have the funds for expensive coins. As their collecting matures, they branch out into better pieces, often of the same/similar types they have collected in the past. Causing the demand to increase, and dealer supplies of these pieces to diminish. Prices then rise, which actually encourages more hunting for said pieces due to the feeling that one's collection is gaining in value, and "the hunt" getting more challenging.
1-2 generations ago, the younger collectors were going after pieces they could find in their change. Which then evolved into variety picking of those types of coins.
I'm not certain about pricing trends, but for the past couple of years I have been favoring in my purchases late 19th C. or early 20th C. medals from France and Belgium and more recent medals from Portugal.
What the price trends are, is not so important to me because I'm not interested in flipping these but yet I want to add these genres to my collection.
This perspective is interesting to me because I haven't been in the coin collecting world that long. Is your perception that the value of your coins has decreased to the point you don't want to sell them, or do you think that there are fewer people bidding on eBay? I find that the number of actual auctions of decent coins on eBay has decreased significantly, and most decent material is listed (and usually not sold) at fixed prices. There could be an argument made that there isn't a critical mass required to maintain regular bidding in some of the world coin areas.
neildroberts - It is hard to describe anything as a trend given the niche market size of pre-1800 german state material. If you look at NGC, the entire population of graded german material from 1500 - present is 62,000 pieces. They probably grade that many pandas in 4 months (China has 1.9M coins in slabs - mostly modern). With that said, the growth of the higher end graded population of talers has moved many collectors up the quality ladder, but I have not seen a backfill of interest in people to follow. It seems the mid range graded material is suffering from a lack of interest if you only look at ebay and the tier 2 auction house offerings. Lesson learned is echoed throughout the forum - buy the best quality you can afford and do your homework on the realities of populations (both in and outside of tpg plastic).
neildroberts - It is hard to describe anything as a trend given the niche market size of pre-1800 german state material. If you look at NGC, the entire population of graded german material from 1500 - present is 62,000 pieces. They probably grade that many pandas in 4 months (China has 1.9M coins in slabs - mostly modern). With that said, the growth of the higher end graded population of talers has moved many collectors up the quality ladder, but I have not seen a backfill of interest in people to follow. It seems the mid range graded material is suffering from a lack of interest if you only look at ebay and the tier 2 auction house offerings. Lesson learned is echoed throughout the forum - buy the best quality you can afford and do your homework on the realities of populations (both in and outside of tpg plastic).
I think you've hit on a key point that not everyone considers. The smaller a coin market is, the more likely it is to have volatile pricing trends. It's hard to distinguish what I've seen over the last few months as being a trend or just volatility.
I've made a point over time of not treating my collecting as an investment. That would require me to buy things that I think other people will finding interesting in the future, and not what I think is interesting now. The highest quality coins will always be the most desirable. The coin market as a whole appears to be down over the last 20 years. Investing in coins would be like shorting a stock. If you think you have enough insider or specific knowledge to buck the bulk trends, then that's fine. But it's high risk, and I'm not going there. I budget an amount of money for coins that I feel comfortable spending as disposable income, a similar approach I take to casinos/gambling. I personally don't appreciate the advice to buy the best you can afford because it might lead people to spend more than they should.
@MrBreeze said:
Can someone please define the market?
My simple definition is: any and everyone who is involved with buying or selling X. The "X" in context to discussions about numismatic coins would obviously mean numismatic product buyers and sellers.
Interesting discussion. I was staying out because I'm a small potatoes collector who doesn't tend to sell stuff much. I don't get the market forces at work, I just follow prices on the coins that interest me.
I think one of the problems with coins as a market is that demand is easily saturated. When I'm looking for a coin, I will be happy to pay "market value". Heck I'll frequently be happy to overpay. But then, once I have my example I'm done. The next one that comes along, unless it's a significant upgrade or offered at a tremendous discount, does not interest me. I've taken myself out of that piece of the market.
Other commodities do not have this problem.
As far as inefficiency..
Collectors have the ability to efficiently hunt for coins. Sites like Vcoins, ma-shops, eBay, and for auctions things like Numisbids, Sixbid make finding lots of things easily. Sure there are still dealer sites who aren't hooked up to that network and even guys who don't have websites (gasp!). But the far more difficult task is for the dealers to find the collectors in a centralized place. As mentioned previously, eBay can offer such an environment but the limitations of that site are also obvious. Perhaps there should be a place where collectors can register their want lists, that could be made available to any participating dealer (who has been verified by PNG or some other credentialing body), so that coins could quickly find homes and could thus trade on smaller margins.
Well, I've said my opinion to Zohar in a one on one that we had yesterday. For me personally, all 3 options are valid:
-auction house -preferably the corner shop- ,it's a gamble, it takes you 6 months to get paid but in many cases it's the right choice to sell your material
-at least one or two good and trusted dealers with whom I've had several transactions before and that I know that he/they always have significant amounts of cash readily available - my preferred choice for esoteric but top grade esoteric items as well as the right connections to resell what I'm selling them
-and several serious and experienced collectors, whose collections I know and I also know their wantlists just as they know mine
All three have advantagres and disadvantages. All three options are ESSENTIAL to whoever is trying to build a really nice, serious and world class collection in its field. I would also add, (besides the selling part) that in order to build a great collection, it's also very importat to buy one or two similar world class collections in the same field, because good luck in trying to collect them all by yourself. Even Eliasberg wouldn't be on the map today if he hadn't bought the Clapp Estate collection.
Perhaps there should be a place where collectors can register their want lists, that could be made available to any participating dealer (who has been verified by PNG or some other credentialing body), so that coins could quickly find homes and could thus trade on smaller margins.
Not a good idea for the collector. When a want list coin shows up at auction, every dealer who has seen the coin on the list will be tempted to buy it and make an easy sale, which can easily drive the price higher. Better for the collector to give his want list to only one dealer and be careful to avoid bidding against himself.
Andy Lustig
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
Perhaps there should be a place where collectors can register their want lists, that could be made available to any participating dealer (who has been verified by PNG or some other credentialing body), so that coins could quickly find homes and could thus trade on smaller margins.
Not a good idea for the collector. When a want list coin shows up at auction, every dealer who has seen the coin on the list will be tempted to buy it and make an easy sale, which can easily drive the price higher. Better for the collector to give his want list to only one dealer and be careful to avoid bidding against himself.
That sounds like a risky strategy for a dealer, as a want list is by no means a commitment to buy. Maybe a want list from a collector whose tastes you know and who is a reliable buyer, but certainly not some random person on the Internet with whom you've never done business.
Which begs the question, how much do want lists drive dealers' inventory acquisition strategy?
Why are we assuming that every coin should go through a dealer? The market has evolved to allow peer to peer dealings for certain coins which dealers do not want to buy for inventory and would not get the attention/placement of the auction house. Ebay used to intermediate, and that is the current void. Agree with issue of want lists and buyer credibility.
We do not assume that every coin should go through a dealer, and of course (replying to Nap) the dealer will only take into consideration want lists from clients that he knows well and has done business with them before.
But as in a recent case, where a friend of mine (a good dealer himself) had purchased a serious banknote collection, of which he knew nothing about, but to separate British colonies' paper and consign it to DNW and do a similar deal with a US auction house for the US notes, he was disappointed both by Stack's and by Heritage. Especially on the lower value items that the auction houses intended to group in lots of half a dozen notes. He politely declined both offers.
So, in his return to Europe, he somehow managed to sell all the less expensive ones to British dealers and he also consigned the expensive items to a European auction house (the notes were graded) and he ended up with a much better deal, ie a good amount of cash in his pocket from the less expensive notes that he sold to the British dealers, and he's now waiting for the results of the auction with the more expensive graded notes. With the internet and third party grading ,he didn't need to travel twice to the US only to come back disappointed and the right bidders will not miss his offerings, even if they are not auctioned by a US auction house. The more options on the table, the better for everybody.
Comments
Enjoyable thread. I have been lurking for a bit trying to decide how to add my 2 cents. Workload, family, and life in general have drained me of deep waxings lately, so I will keep it simple. I suppose the I am stuck in the aforementioned "liquidity" conundrum. I still have an appetite for the hobby but I am having trouble finding buyers to raise funds to put back into the collection. I am at a place where the majority of funds available for purchases are generated when I can free cash from existing pieces in my collection. For the first decade of the millennium, eBay gave the average Joe like myself solid feet to buy and sell pieces in the middle market. Funds received was a function of the quality of the coin pictured in the auction rather than one's ability to haggle for respectable prices from brick and mortar owner or show dealer. eBay was the great equalizer. Unfortunately, the eBay balloon has been slowly deflating in recent years and I no longer can garner bids or even watchers for the same or better pieces. As a result, I sense that the small to mid size collector has lost some of the momentum. Sure, I can price at a 40% discount and find a quick buyer, but where is the incentive to do so? My only urgency is the desire to reinvest in new pieces. If I can't come close to recovering my initial investment, I just settle into a long term hold pattern. What is the best strategy to find buyers for respectable EF/AU material that is not capturing the hearts and minds of the glamorous auction houses and tier one eyes?
"Inefficient", does sound a bit of a euphemism and rationale for scorching the seller though. Our buddy at A---s is then likely efficient for buying high and selling far higher?
I really dislike it when there is a bit of hiding behind verbosity. And sticking to the OP, as others have said what is hot is what you're trying to buy as a collector, and what is not is what you might try to sell - even if it may actually be plenty hot. Have to say that like a lot of others, this has pushed me to sell at auction.
Well, just Love coins, period.
7Jaguars I believe we really see eye to eye. The inefficiency stems from the dealer profit expectation when compared with an auction. The only way to enable such spread is make discounted (firesale level) offers to justify tying up of capital with the hopes of a highly profitable resale. The best route is sell to a collector who will pay retail or near or auction which takes a chunk of the sale in commission and will not solve the immediacy issue yet hopefully that will be offset by the larger buyer universe compared with that of a more localized dealer. 3rd option is consignment to a dealer where his client base is relevant to the sold material. The fees there are far reduced as the dealer is not tying up capital.
As worldcoinguy indicated, eBay used to be the goto place yet has been tarnished by various factors. I have coins listed there at half of the price of what dealers or auctions fetch. That's inefficiency and disruption will come should entrepreneurs view the market as a long term proposition.
My definition for liquidity is therefore - "the ability to sell a coin within a reasonable timeframe at a reasonable price"
This perspective is interesting to me because I haven't been in the coin collecting world that long. Is your perception that the value of your coins has decreased to the point you don't want to sell them, or do you think that there are fewer people bidding on eBay? I find that the number of actual auctions of decent coins on eBay has decreased significantly, and most decent material is listed (and usually not sold) at fixed prices. There could be an argument made that there isn't a critical mass required to maintain regular bidding in some of the world coin areas.
IG: DeCourcyCoinsEbay: neilrobertson
"Numismatic categorizations, if left unconstrained, will increase spontaneously over time." -me
Zohar, I wanted to chime in and agree with most of your points. Coming from the world of manufacturing, the way dealers treat inventory management and liquidity boggles my mind. Why would you have so much hold time on inventories that have a not insignificant likelihood of devaluing. I also notice that when I visit the same dealers at a coin show 90% of the coins will be the same and they only turn over about 10%. I've been looking at the same coins for 5+ years from some dealers. There is some expectation from customers that a dealer have a minimum inventory, but that seems like too long.
IG: DeCourcyCoinsEbay: neilrobertson
"Numismatic categorizations, if left unconstrained, will increase spontaneously over time." -me
My view (not speaking for worldcoinguy) is that once the credibility and buyers leave the platform, sellers protect themselves by setting high reserves. Years ago it was a viable outlet with 0.99c starting prices. Combination of low ethics, poor enforcement drove out buyers, leaving more commoditized material. Certain credible dealers use Ebay as a way to cost effectively acquire customers as the subsequent sales are done offline. A credible platform will bring in buyers and will enable free flow of goods. The arbitrage is so significant where at times a coins can be bought at 50% on Ebay compared to what it would fetch on auction. Shouldn't be this way in an efficient marketplace.
If you are baking in a 20-100% profit expectation, it means that you will only buy at heavily discounted prices otherwise, remain liquid. Most dealers have VERY low overhead and I cant understand why such a profit target is warranted. The availability of transparent price discovery tool (auction records etc) will only put pressure on the markup, but also prevent set the proper price expectation in seller's mind.
To conclude - reduced liquidity (ability to sell at reasonable price) will limit purchasing in general. If you look at auction houses far more coins are listed with a high reserve price no different than Ebay. Create liquidity, market benefits.
Something I didn't mention that also affects this behavior is the availability of coins to dealers. If a lot of dealers reduced their prices and were able to sell coins faster, I don't know if they would be able to replace that inventory. The amount of product available to dealers may actually be insensitive to how much they are willing to pay for material. If that's true, then consolidation of the dealer market would enable smaller margins.
You'd think if dealers were working off of a 100% profit, then they'd be willing to negotiate more and take more loss on their expectations (not a real loss).
I should also mention in this thread that the commercial nature of this hobby has always been a source of grief for me. It seems like everyone involved in the hobby has some sort of profit incentive. There are a lot of hobbies where this is not the case. I know shouldn't be surprised considering this one is directly related to money. I enjoy talking about these trends, but it makes me a little sad that I don't see more trading, sharing, and cooperation.
IG: DeCourcyCoinsEbay: neilrobertson
"Numismatic categorizations, if left unconstrained, will increase spontaneously over time." -me
The margin is higher at the higher end of the spectrum where the more mainstream coins trend at lower band. As you had noted, inventories are very thin (Atlas being a big exception). Actually if you look at Atlas - very much focused on the highest tier in terms of quality/scarcity - the guy works VERY hard to travel the globe hunting the best material AND maintain a very expensive inventory and staff. I bet most of his material is purchased in the primary market (auction/collector) and resold. The website is professionally managed as is the entire globally oriented business.
I assume such overhead and cost of capital buried in inventory can only be accounted for with higher margins at the account of reduced sell through and if a business utilizes its own capital to fund inventories and run a professional retail oriented business, they should be rewarded for their investments.
Are there other dealers that handle their business in such manner on the world coin side? Very few if any invest in the infrastructure at this level, including inventory. I therefore would think the margin requirements should be far more moderate. Your comment about replacement is spot on, as clearly finding the bargain for the firesale item and/or something that falls within the very narrow customer base they can immediately flip. Limited scope, capitalization for most is my observation.
Cladking brings up some good points that I will expand on.
Newbie/younger collectors tend to focus on "bang for the buck" and nice looking/interesting lower value coins. Right now, that feels like older world coins and ancients.
They simply don't have the funds for expensive coins. As their collecting matures, they branch out into better pieces, often of the same/similar types they have collected in the past. Causing the demand to increase, and dealer supplies of these pieces to diminish. Prices then rise, which actually encourages more hunting for said pieces due to the feeling that one's collection is gaining in value, and "the hunt" getting more challenging.
1-2 generations ago, the younger collectors were going after pieces they could find in their change. Which then evolved into variety picking of those types of coins.
I'm not certain about pricing trends, but for the past couple of years I have been favoring in my purchases late 19th C. or early 20th C. medals from France and Belgium and more recent medals from Portugal.
What the price trends are, is not so important to me because I'm not interested in flipping these but yet I want to add these genres to my collection.
This perspective is interesting to me because I haven't been in the coin collecting world that long. Is your perception that the value of your coins has decreased to the point you don't want to sell them, or do you think that there are fewer people bidding on eBay? I find that the number of actual auctions of decent coins on eBay has decreased significantly, and most decent material is listed (and usually not sold) at fixed prices. There could be an argument made that there isn't a critical mass required to maintain regular bidding in some of the world coin areas.
neildroberts - It is hard to describe anything as a trend given the niche market size of pre-1800 german state material. If you look at NGC, the entire population of graded german material from 1500 - present is 62,000 pieces. They probably grade that many pandas in 4 months (China has 1.9M coins in slabs - mostly modern). With that said, the growth of the higher end graded population of talers has moved many collectors up the quality ladder, but I have not seen a backfill of interest in people to follow. It seems the mid range graded material is suffering from a lack of interest if you only look at ebay and the tier 2 auction house offerings. Lesson learned is echoed throughout the forum - buy the best quality you can afford and do your homework on the realities of populations (both in and outside of tpg plastic).
Can someone please define the market?
https://www.pcgs.com/SetRegistry/collectors-showcase/world-coins/one-coin-per-year-1600-2017/2422
I think you've hit on a key point that not everyone considers. The smaller a coin market is, the more likely it is to have volatile pricing trends. It's hard to distinguish what I've seen over the last few months as being a trend or just volatility.
I've made a point over time of not treating my collecting as an investment. That would require me to buy things that I think other people will finding interesting in the future, and not what I think is interesting now. The highest quality coins will always be the most desirable. The coin market as a whole appears to be down over the last 20 years. Investing in coins would be like shorting a stock. If you think you have enough insider or specific knowledge to buck the bulk trends, then that's fine. But it's high risk, and I'm not going there. I budget an amount of money for coins that I feel comfortable spending as disposable income, a similar approach I take to casinos/gambling. I personally don't appreciate the advice to buy the best you can afford because it might lead people to spend more than they should.
IG: DeCourcyCoinsEbay: neilrobertson
"Numismatic categorizations, if left unconstrained, will increase spontaneously over time." -me
My simple definition is: any and everyone who is involved with buying or selling X. The "X" in context to discussions about numismatic coins would obviously mean numismatic product buyers and sellers.
Interesting discussion. I was staying out because I'm a small potatoes collector who doesn't tend to sell stuff much. I don't get the market forces at work, I just follow prices on the coins that interest me.
I think one of the problems with coins as a market is that demand is easily saturated. When I'm looking for a coin, I will be happy to pay "market value". Heck I'll frequently be happy to overpay. But then, once I have my example I'm done. The next one that comes along, unless it's a significant upgrade or offered at a tremendous discount, does not interest me. I've taken myself out of that piece of the market.
Other commodities do not have this problem.
As far as inefficiency..
Collectors have the ability to efficiently hunt for coins. Sites like Vcoins, ma-shops, eBay, and for auctions things like Numisbids, Sixbid make finding lots of things easily. Sure there are still dealer sites who aren't hooked up to that network and even guys who don't have websites (gasp!). But the far more difficult task is for the dealers to find the collectors in a centralized place. As mentioned previously, eBay can offer such an environment but the limitations of that site are also obvious. Perhaps there should be a place where collectors can register their want lists, that could be made available to any participating dealer (who has been verified by PNG or some other credentialing body), so that coins could quickly find homes and could thus trade on smaller margins.
Well, I've said my opinion to Zohar in a one on one that we had yesterday. For me personally, all 3 options are valid:
-auction house -preferably the corner shop- ,it's a gamble, it takes you 6 months to get paid but in many cases it's the right choice to sell your material
-at least one or two good and trusted dealers with whom I've had several transactions before and that I know that he/they always have significant amounts of cash readily available - my preferred choice for esoteric but top grade esoteric items as well as the right connections to resell what I'm selling them
-and several serious and experienced collectors, whose collections I know and I also know their wantlists just as they know mine
All three have advantagres and disadvantages. All three options are ESSENTIAL to whoever is trying to build a really nice, serious and world class collection in its field. I would also add, (besides the selling part) that in order to build a great collection, it's also very importat to buy one or two similar world class collections in the same field, because good luck in trying to collect them all by yourself. Even Eliasberg wouldn't be on the map today if he hadn't bought the Clapp Estate collection.
edited to add: hi James, thanks for the input
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Kunker definitely has a strong book of bidders... this coin would not fetch such amount in the US and this with a strong dollar.
https://kuenker.de/en/auktionen/stueck/149703
Perhaps there should be a place where collectors can register their want lists, that could be made available to any participating dealer (who has been verified by PNG or some other credentialing body), so that coins could quickly find homes and could thus trade on smaller margins.
Not a good idea for the collector. When a want list coin shows up at auction, every dealer who has seen the coin on the list will be tempted to buy it and make an easy sale, which can easily drive the price higher. Better for the collector to give his want list to only one dealer and be careful to avoid bidding against himself.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
That sounds like a risky strategy for a dealer, as a want list is by no means a commitment to buy. Maybe a want list from a collector whose tastes you know and who is a reliable buyer, but certainly not some random person on the Internet with whom you've never done business.
Which begs the question, how much do want lists drive dealers' inventory acquisition strategy?
Why are we assuming that every coin should go through a dealer? The market has evolved to allow peer to peer dealings for certain coins which dealers do not want to buy for inventory and would not get the attention/placement of the auction house. Ebay used to intermediate, and that is the current void. Agree with issue of want lists and buyer credibility.
We do not assume that every coin should go through a dealer, and of course (replying to Nap) the dealer will only take into consideration want lists from clients that he knows well and has done business with them before.
But as in a recent case, where a friend of mine (a good dealer himself) had purchased a serious banknote collection, of which he knew nothing about, but to separate British colonies' paper and consign it to DNW and do a similar deal with a US auction house for the US notes, he was disappointed both by Stack's and by Heritage. Especially on the lower value items that the auction houses intended to group in lots of half a dozen notes. He politely declined both offers.
So, in his return to Europe, he somehow managed to sell all the less expensive ones to British dealers and he also consigned the expensive items to a European auction house (the notes were graded) and he ended up with a much better deal, ie a good amount of cash in his pocket from the less expensive notes that he sold to the British dealers, and he's now waiting for the results of the auction with the more expensive graded notes. With the internet and third party grading ,he didn't need to travel twice to the US only to come back disappointed and the right bidders will not miss his offerings, even if they are not auctioned by a US auction house. The more options on the table, the better for everybody.
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