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Lessons learned selling
Gazes
Posts: 2,315 ✭✭✭✭✭
I don't sell coins too often but recently did so to weed out a few coins that didn't really fit what I was doing and to purchase a coin that did. I also did not mind selling to learn and possibly make more educated new purchases.
I sold 3 coins at auction (I am going to be intentionally vague about the coins and the auction). All three were high quality, PCGS, good eye appeal and all three stickered. All three coins I had not held for very long (less than 2 years) so quite frankly I expected for that reason alone to take some type of loss on all 3.
The first coin was a one year type and it was a beauty. It went for what the price guides said it would. The problem was I paid on the very high end of the spectrum for the coin. I rationalized it that it was such great quality but at the end of the day, although it was a top pop type of coin, there were plenty of other coins that grade and I guess no one wanted to pay a premium. Took about a 33% hit.
The second coin was also a one year type, CAC, PCGS and had a plus given by PCGS. I could say much of the same about this coin as the last but I bought it on the low end of the spectrum. I made a 50% profit on this one. By the way the first two coins were from the same dealer.
The last coin was neat coin but never made sense in my collection. I remember when I bought it, there was very little pricing info. No auctions for its grade. No auctions for the grade below. In the grade above, an auction maybe 10 years ago. The price guide was clearly very very low. Again the coin was beautifiul, PCGS and CAC. I thought it was a candidate for an upgrade (so did the auction house----but came back with the same grade).
The price I paid I thought was reasonable----about $6500. The auction price ended up being a little above $5000. I can't say I really disagree with the auction price---looking at all the data it looked reasonable.
The final coin was one that I got from a dealer that I thought was just a steal at its price and bought if for that reason. Again, PCGS, stickered and only one graded higher ( about 7 at its grade). Well, this was the only coin I didn't auction but used in a trade for a coin I really wanted. Keep in mind I bought the coin really because I thought it was way too low---but I traded it for the value I bought it. No gain or loss but got a coin I wanted. Well, I saw it up for auction recently----it went for almost double my purchase price. Live and learn.
What did I learn:
1) Quality absolutely helps but not at any price (at least with coins that are not trophy coins are on one of kind)
2) on more unique coins that are hard to price, probably should have gone back to the original dealer to see what he would have paid
3) Even if the price guides are wrong---if you pay well above them, you will have an uphill battle to get your money back even if your right about what the price should be.
4) when I bought quality coins for a reasonable price---it was very profitable.
This probably is all common sense to most of you, but having gone through it helped me see things a bit clearer going forward
I sold 3 coins at auction (I am going to be intentionally vague about the coins and the auction). All three were high quality, PCGS, good eye appeal and all three stickered. All three coins I had not held for very long (less than 2 years) so quite frankly I expected for that reason alone to take some type of loss on all 3.
The first coin was a one year type and it was a beauty. It went for what the price guides said it would. The problem was I paid on the very high end of the spectrum for the coin. I rationalized it that it was such great quality but at the end of the day, although it was a top pop type of coin, there were plenty of other coins that grade and I guess no one wanted to pay a premium. Took about a 33% hit.
The second coin was also a one year type, CAC, PCGS and had a plus given by PCGS. I could say much of the same about this coin as the last but I bought it on the low end of the spectrum. I made a 50% profit on this one. By the way the first two coins were from the same dealer.
The last coin was neat coin but never made sense in my collection. I remember when I bought it, there was very little pricing info. No auctions for its grade. No auctions for the grade below. In the grade above, an auction maybe 10 years ago. The price guide was clearly very very low. Again the coin was beautifiul, PCGS and CAC. I thought it was a candidate for an upgrade (so did the auction house----but came back with the same grade).
The price I paid I thought was reasonable----about $6500. The auction price ended up being a little above $5000. I can't say I really disagree with the auction price---looking at all the data it looked reasonable.
The final coin was one that I got from a dealer that I thought was just a steal at its price and bought if for that reason. Again, PCGS, stickered and only one graded higher ( about 7 at its grade). Well, this was the only coin I didn't auction but used in a trade for a coin I really wanted. Keep in mind I bought the coin really because I thought it was way too low---but I traded it for the value I bought it. No gain or loss but got a coin I wanted. Well, I saw it up for auction recently----it went for almost double my purchase price. Live and learn.
What did I learn:
1) Quality absolutely helps but not at any price (at least with coins that are not trophy coins are on one of kind)
2) on more unique coins that are hard to price, probably should have gone back to the original dealer to see what he would have paid
3) Even if the price guides are wrong---if you pay well above them, you will have an uphill battle to get your money back even if your right about what the price should be.
4) when I bought quality coins for a reasonable price---it was very profitable.
This probably is all common sense to most of you, but having gone through it helped me see things a bit clearer going forward
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Comments
I buy low low and sell high. Not much of a buyer above 60-70% MV. I generally sell at retail only. Its easier to buy coins than sell them. If I can not buy a coin or banknote right, its a no go for me.
It amazes me people will spend tens of thousands on coins but never got out and got experience selling from their table at a show let alone taking an ebay store subscription. I can manage my ebay store with my iPhone and it takes super photos.
You took a major hit on 2 out of 3 coins letting them go at auction. I think your lucky even one of them made money. Big ticket material is tough to sell and make money on. I would suggest you regroup, sign up for a table at a show, get a light (architect lamp w some 100 watt bulbs) at Target or Walmart and rent a case or two. You can fill up any voids with currency or cheaper stuff if your big ticket coins do not fill it.
Every coin and banknote I have is inventory and for sale at the right price. The better your buying cash is vs inventory, the better off you are. During ebay summer doldrums I clean up buying.....
Auctions can be a liquidation, expect to lose money especially in this market.
Yet, I see dealer's blogs saying that people pay too much at auction! (Often followed by descriptions of what great auction buys they made).
So....I'm not sure what my point is.
The best price guides are the best for a reason. If you buy a coin above Grey Sheet bid it better be special because you're not going to break even upon resale. Similarly, in any auction circumstance where there's a Buyers Premium that amount MUST be deducted from your purchase price. If the coin keeps getting bid up further, let it go because (again) you'll get buried in it.
Finally, on coins that are expensive or at all unique you have to put it in an auction that will allow you a reserve. You might have a very rare MS 65 Barber dime (as an example) and a room full of bidders with no Barber dimes in their collection above XF. Compound that problem with the fact that exactly no body at the auction has the $3,000 to spend on it to get you even and bad things are going to happen.
"Look up, old boy, and see what you get." -William Bonney.
Ws
Latin American Collection
Great post. One important piece of information that I didn't see in your post is whether there were recent auction records on your specific coins. "Fresh" cannot be ignored when figuring price even though in some cases it should be.
The only coin I would considered "fresh" that I sold was the third coin listed in my OP. Again that coin had no auction records for the grade or the grade next to it. I really had to try and value the coin when I initially purchased with little and contradicting information. Looking back---it appears I probably valued it a bit high. That being said, if I held on to the coin longer or possibly looked for a different outlet to sell, I think I would have done much better.
And try to buy more when the coin market cycle is weak (ie blood in the streets like 1992-1996, 2001-2002, 2009-2010, and even today in many market sub-sectors.
It's very easy to recognize the "weak" parts of the market in hindsight. Not so easy in real time.
Coin Rarities Online
Think like a dealer. Buy like a dealer.
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Think like a dealer. Buy like a dealer.
That makes you a dealer.
There is a fundamental difference between buying as a dealer and buying as a collector. Not understanding these differences can take you down a less than a favorable road as a collector.
At the end of the day, it is what the coin is worth to those buyers (hopefully two bidding seriously) in this market. That is why my comment regarding thinly traded series is important as it is far more difficult to get a bidding battle in that scenario. Also a factor when buying in that category.
I do salute you for taking the plunge and selling. I sold my first coins about 15 years ago and fortunately learned the hard lessons with relatively cheap coins. There are Always lessons for newbies to selling in any market with any product. Well done, I hope it helps you buying process in the future.
Auctions can be a liquidation, expect to lose money especially in this market.
I buy low low and sell high. Not much of a buyer above 60-70% MV. I generally sell at retail only. Its easier to buy coins than sell them. If I can not buy a coin or banknote right, its a no go for me.
It amazes me people will spend tens of thousands on coins but never got out and got experience selling from their table at a show let alone taking an ebay store subscription. I can manage my ebay store with my iPhone and it takes super photos.
You took a major hit on 2 out of 3 coins letting them go at auction. I think your lucky even one of them made money. Big ticket material is tough to sell and make money on. I would suggest you regroup, sign up for a table at a show, get a light (architect lamp w some 100 watt bulbs) at Target or Walmart and rent a case or two. You can fill up any voids with currency or cheaper stuff if your big ticket coins do not fill it.
Every coin and banknote I have is inventory and for sale at the right price. The better your buying cash is vs inventory, the better off you are. During ebay summer doldrums I clean up buying.....
I give away money. I collect money.
I don’t love money . I do love the Lord God.
Figure out which dealers are the best alternate outlets for specific types of material. I have found that to be a better outlet for esoteric or niche material.
In the past ( intentionally vague ), I sold 3 CW double Eagles through a major auction house. So, all supposedly key dates. All three were solid for the grade. All 3 CAC. All MS. One had 55 higher PCGS pop that I lost 18%, one was a shipwreck pedigree with 12/20 higher and lost 16% ( great buy for new owner ), and the third also had a shipwreck pedigree and was a beautiful coin ( best eye appeal of all ) with 25 higher was a gain of 41%. All three held for about 4 years. The moral to me was the finest eye appeal garnered the most attention. These figures are pre-deduction of buyers fees, although the fee was negotiated.
All 3 were presented to 2 top rare gold dealers with no interest in consignment. 1 was interested in purchase at lower numbers than above. Thus, while Boosibri's advise can be valid in many cases, it isn't always.
US Civil War coinage
Historical Medals
The last four coins I sold, 2 to a dealer and 2 at auction, I basically broke even & count that as a success. This was done to retrospectively pay for 2 other coins I bought from a forum member. I've got 4 more on their way to an auction and I suspect I'm going to take a bath on them. But honestly, I don't have the time or interest to rent a table and spend my weekend at a local bourse. I'll take a $2-300 hit to buy my weekend back.
When I was 5 or 6 I collected soap from motels/hotels...in those days they all had small individual packages of soap with the brand on one side...and the name/address of the property on the other...I got them when we went on vacation...and begged everyone I knew to pick some up when they went away too...probably had a 1000 of them...found them again when my parents sold their house about 10 years ago...thought maybe I should just use them in the shower...LOL...but despite being kept hidden away in box in a fairly cool closet...after 40 years they had withered away inside their paper wrap...and had to be thrown out...obviously the fun was in the memory and the collecting...
We come into this world with nothing...and we leave with nothing...I keep my box of 20 in my office desk...and look at them every day...if someone steals them or whatever...so be it...easy come...easy go...
- Jon
Auctions can be a liquidation, expect to lose money especially in this market.
I buy low low and sell high. Not much of a buyer above 60-70% MV. I generally sell at retail only. Its easier to buy coins than sell them. If I can not buy a coin or banknote right, its a no go for me.
It amazes me people will spend tens of thousands on coins but never got out and got experience selling from their table at a show let alone taking an ebay store subscription. I can manage my ebay store with my iPhone and it takes super photos.
You took a major hit on 2 out of 3 coins letting them go at auction. I think your lucky even one of them made money. Big ticket material is tough to sell and make money on. I would suggest you regroup, sign up for a table at a show, get a light (architect lamp w some 100 watt bulbs) at Target or Walmart and rent a case or two. You can fill up any voids with currency or cheaper stuff if your big ticket coins do not fill it.
Every coin and banknote I have is inventory and for sale at the right price. The better your buying cash is vs inventory, the better off you are. During ebay summer doldrums I clean up buying.....
This puzzles me as well
mark
Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
Think like a dealer. Buy like a dealer.
That makes you a dealer.
There is a fundamental difference between buying as a dealer and buying as a collector. Not understanding these differences can take you down a less than a favorable road as a collector.
Agreed.
OP, nice post. Well done
mark
Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
Think like a dealer. Buy like a dealer.
That makes you a dealer.
There is a fundamental difference between buying as a dealer and buying as a collector. Not understanding these differences can take you down a less than a favorable road as a collector.
Many dealers end up with some of the finest collections. You can do both. The buying/selling/grading skills learned as a dealer can never hurt you building a collection. In today's market, most top level collectors tend to display dealer-level skills. Being a collector doesn't mean you fork over a 15-35% retail commission...and then suffer through another 10-30% commission on selling. I recall one dealer around here stating that they never charge more than a 25% commission. I checked their on-line inventory and one of the coins I had just sold them for $30,000 was marked up at $38,500 (28%). I had a nice chuckle on that one.
And try to buy more when the coin market cycle is weak (ie blood in the streets like 1992-1996, 2001-2002, 2009-2010, and even today in many market sub-sectors.
It's very easy to recognize the "weak" parts of the market in hindsight. Not so easy in real time.
Actually, some of those periods were quite easy to recognize. I stayed out of the market from fall of 1979-summer 1982. That was very easy to spot and I was a newb then. The buying opportunities in 1996-2002 and 2009-2010 were also easy to spot. In my case I didn't have the extra money until 2001, when I started loading back up. My own buying tapered off in 2004-2005 as market heat was picking up. I stopped buying longer term numismatic coins for the most part in 2006. Sold off all my slabbed dregs by mid-2008. Not saying I made all the right moves as I did not. But it wasn't hard to identify market troughs when they tend to coincide with other major market slumps (stocks, currencies, housing, collectibles-cars, etc.). Dealers have to play in both good and bad markets. But a collector looking out for their own safety tend to better spot the peaks and back off. The number of nice collections coming to auction in 2006-2008 was pretty amazing. Ed Price was about the last guy out the door in August 2008. I sat through the FUN 2009 coin auction and recognized the blood bath pretty quickly. It even stunned me, though I was not in a position to buy.
US Civil War coinage
Historical Medals
.... All three held for about 4 years. ...
Excuse my naivety, but as I understand it, as a collector isn't it very hard to make a profit by only holding a coin 4 years? (Assuming you paid what was a fair price). That seems short term. Unless you buy it for some sort of great deal.
Successful transactions with: wondercoin, Tetromibi, PerryHall, PlatinumDuck, JohnMaben/Pegasus Coin & Jewelry, CoinFlip, and coinlieutenant.
US Civil War coinage
Historical Medals
JonRuns:
Although this statement is a little far-reaching for my taste, it is fair to point out that collectors should not expect to make profits by consigning coins to auction, especially not coins that were purchased during the previous five years. As JonRuns implies, collectors should buy coins for which they could afford to take losses in situations where sales are necessary or advisable for reasons unrelated to coins.. I agree with JonRuns that a collector who is very concerned about incurring losses might be buying coins that he really could not afford at the onset of his collecting quests.
Totally:
Exactly, "Totally," it just does not make sense for collectors to expect or devot time seeking profits on coins that were purchased less than five years ago. It might not be a good idea to expect profits at any time. Coin markets are often volatile and are even less predictable than some other kinds of markets. It does not make sense to assume that market prices will be higher when coins or sold, three years later or ten years later. Even so, ON AVERAGE (NOT ALWAYS), fresh coins will bring higher prices at auction than the same coins if they were stale.
What are Auction Prices?
When great collections are offered at auction and collectors are competing with dealers for the same great coins and a collector wins a coin, they outbid dealers, there is the loss if sold shortly thereafter. On the other hand, if that collector holds that coin and builds value with his or her collection then over a longer period of time, he should make money on his collection. Collectors and dealers have different goals when buying.
US Civil War coinage
Historical Medals