Raw vs Graded Bullion

CoinPhysicist

Sort of in the spirit of my last question and building on it. If you were to buy a generic date pre-1933 double eagle with 3 options:

1. Raw for $40 over spot (A random number I made up)
2. PCGS/NGC MS 62 for $70 over spot (actual price from APMEX right now)
3. PCGS/NGC MS 64 for $100 over spot (actual price from APMEX right now)

With the intent of reselling the coin at some point in the relatively near future (so you can ignore the spot price of gold changing between buying and selling), which one would you get to have the smallest spread? I understand that if anyone just bought for any of these prices I list and took the coin to a dealer, that he or she would in-fact lose money as the dealer will pay a chunk less because the dealer has to make a profit. I'm just wondering which of these would cause the smallest loss of money to the original buyer. Or, would the loss for all 3 cases of taking each to a dealer be approximately equal? Basically, does the dealer buying value PCGS/NGC MS 64 more $30 more than PCGS/NGC MS 62? Or could the dealer care less and will offer spot for all 3 regardless?

PerryHall

@totally said:

Or could the dealer care less and will offer spot for all 3 regardless?

Unfortunately, you would be lucky to get full melt value from most coin dealers.

derryb

Number 2.
certified authentic is worth the extra premium. Your buyer will be more confident in his purchase. Keep in mind you are buying because you believe gold will rise by the time you sell.

Never buy bullion with the intention of selling it later to a dealer. Sell it retail.

CoinPhysicist

Thanks for the responses. Just to clarify. I am not actually planning on buying bullion and immediately taking it to a dealer and selling it at a loss because that would be a really dumb thing to do (unless money was somehow infinite, which of course it is not). I'm just trying to see if one of the 3 examples I listed has less potential downside than the others. . Cheers.

MorganMan94

If this were a situation I was in I would wait until I received an 8% or 10% Ebay bucks offer and then check the offerings on Ebay. With the Bucks and CC rebates you could be able to get a better deal on slabbed.
Just a quick search shows $20 DE in MS62 for $1,361 and MS63 for $1,388 with both eligible for bonus bucks.

CoinPhysicist

Of course as @MorganMan94 eluded to, with eBay bucks the deal gets reasonable.

That's why I was kind of asking. With the eBay bucks, is it better to buy a raw or pay more for a slabbed 62 or pay $30 more again for a 64?

With $100 back in eBay bucks, that $100 premium on the 64 essentially disappears over spot if you buy another with your rewards in a cycle.

Timbuk3

Very valid responses !!!

blitzdude

What's the condition of the raw coin? If you believe it to be 62 or less I would stick with the slabbed one. You couldn't even get it graded for the price difference in your example.

Bonus bucks make it tempting but imo with the current market the APMEX actual prices are not really a deal. Ending up with a slabbed 64 at spot or a 62 for $30 under via the buck bonus does make it nice.

bronco2078

use the bucks deals to load up on raw 20 francs . Its not the slabbed or raw that makes the one oz coins easy or hard to sell . its the 1 oz size , it makes it harder to sell to a private party , which funnels you into selling back to a dealer out of frustration.

I own many total ounces of gold but the biggest coin I own is a sovereign at the moment.

Now when gold was 200 an ounce selling 1 ounce coins was no problem , but I assume you want it to go up from here . At $2000 an ounce good luck selling big coins to regular people . The become less liquid as spot goes up , that doesn't happen with fractionals . If spot goes down it doesn't make fractionals any harder to sell.

uncle sam will probably add more rules about selling gold as time goes on. If you sell to a dealer you will have no choice to comply

onlyroosies

If you're going to buy bullion with the idea of holding short term why not buy raw AGE's at $5 over spot. I just got back from the Long Beach show and Heritage is selling at that number. I found another dealer on the floor buying the same coins for $3 over spot. I did not buy but I did sell to the dealer paying $3 over spot.

blitzdude

$5 over for a 1oz age? Sure wish I was in Long Beach. Surprised the physical market is so soft with recent price movement.

Kkathyl

Neither from Apmex too many stories of low quality. That aside Pre 1933 I would go for the 100 over spot for the 64. Hope for a good Collectable.

CoinPhysicist

Thanks for the thoughts, I will actually be at long beach tomorrow! So I will investigate. I couldn't go today though .

derryb

Always have resale in mind when making a bullion purchase. Certified authenticity is a major plus.

TwoSides2aCoin

@PerryHall said:

@totally said:

Or could the dealer care less and will offer spot for all 3 regardless?

Unfortunately, you would be lucky to get full melt value from most coin dealers.

And that’s primarily due to the scarcity of actual collectors.

ricko

If I were buying with the intent to resell, I would take the 62.... that would move more easily when bullion rises... You have the authentication and more room to move... Cheers, RickO

asheland

No question I would take the 64 for $100 over.

musstangr

Damn, I paid $20 over spot for a couple AGE's at Long Beach from the Argent Group, missed the $5 deal. To answer the question I'd probably do the $70 over for the 62 DE from Apmex. Think you could do better at a show though.