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Cost to collect
Soldi
Posts: 2,024 ✭✭✭✭✭
Does anyone out there think this hobby is getting just too darn expensive. I mean prices are up on many coins over the years
yet the margins dealers need are very high IMHO est 50% even on certified pieces across the board. Then of course % wise Pogue probably wasn't 50% margin, but who can collect that quality? Another thought unless you're a self insured dealer look at the price of postage for an insured package for say $900 item. I had a neighbor say good coins are just too expensive to collect any longer. What do you guys think? Thank you. Regards, Sol
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I think there is room to "pick your level" in numismatics. In other words, you can seek out $2000 coins, or $20 coins, or $200 coins. All three levels have their own charm and entertainment value.
Of course, if you have a $2000 eye, and a $20 pocketbook, well, then I can see the frustration.....
Very well said!!
No, not at all I have a $500 to $3000 dollar pocket book and the price is not the issue. I was commenting on the margins and the costs incurred in participating. I mentioned mailing Si/no? Regards, Sol
Better the coin more the margin won't be a factor.
I'd like you to point out the 50% margin dealers because the vast majority of dealers I know and work with are happy/try to make 10%.
Andrew Blinkiewicz-Heritage
You might consider other avenues of acquiring coins. There are five or six really fantastic dealers that I simply can't buy from. Their asking prices are just too high. I don't even look in their cases at shows as I already know it will just be frustrating and leave me either buried or wanting. Only about 40% of my collection was acquired from dealers at retail. Many of the others came from auctions, forum members, other collectors, and such. If I had to pay a 50% margin compared to what I could sell them for I'd have heartburn too.
Even so, in the best of circumstances you can expect at least a 20% hit if you're forced to sell shortly after buying. Postage sucks. The expense of travel, grading, regrading, stickering, etc, also sucks.
If it isn't fun, do it a different way or find something else you enjoy. The minute the hobby becomes a burden to me, I lay off, participate only virtually for a while, and wait for deals I can live with.
Easy answer is buy from Great Collections and sell through Great Collections.
Spread on coins under $1000 is 15% and 10% on the pricier stuff. Deosn't have the Ebay grief or the B&M attitude. They do all the work.
He is the boss site now for a huge selection of no reserve auctions.
Most expensive fish I ever ate, I caught myself off a charter boat. But boy did my son and myself enjoy the trip.
Most hobbies don't give any return on investment.
Prices have definitely gotten higher for scarce 19th century dated and type coins. Part of the problem is grade-flation. Years ago you could look at coins graded AU-50 or 55, and most of the time they would be nice coins. Now most of the pieces I see graded AU-50 are big disappointments. Many of the former AU-50s have moved to higher levels on the AU scale and many of the former AU-55s and 58s have gone to grades ranging from AU-58 to MS-62 or even 63. I know this is true because I have been able to find those coins in lower grade holders in past auctions.
Despite grade-flation the prices for these reconstituted Mint State coins have not dropped by that much. You pay more money for the same coin with a higher grade assigned to it. This has been were much of the money has been made in recent years. It has not been from prices increases in the grades, but from re-assignment of the grades.
One of the most frustrating coins on my want list is the 1839-C quarter eagle. Doug Winter says it's not that tough, and if you go by the number of pieces offered for sale he's right. There were five pieces on the bourse floor at the Orlando Winter ANA show ranging in grade from EF-40 to MS-62.
The trouble is all of the Mint State graded pieces and an AU-58 had been shined up like brass buttons. They should have been in "details" grade holders for improper cleaning. Yet NGC saw fit to give them high grades, and the dealers had asking prices of $21,000 to $28,000. When NGC does that, they only encourage the coin doctors. Those coins were not worth much of anything to me because they looked awful.
Unlike some of the members here, I am not a purest. I can accept a coin that has been worked on a little if it still has decent eye appeal. I can't stand gold coins that look like "brass buttons" however. That goes way beyond what I am willing to accept.
Grade-flation is one of the reasons why I need to wean myself off of U.S. coins. You just have pay too much for anything that is decent.
Dealers' markups are irrelevant. What matters is the cost and the resale value. And if you are knowledgeable enough, it's not that hard to build a collection of coins that, on average, could have netted immediate profits on resale, if that was the intent.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
It is the hobby of kings for a reason.
I'd be more upset at the cost to ship a $10 coin
than the cost to ship a $900 coin.
for PCGS. A 49+-Year PNG Member...A full numismatist since 1972, retired in 2022
I think that you are way off base saying that dealer margins are around 50%. If my margin was 50% and I got that all the time I would quit my day job. Define what a good coin is and why they are getting too expensive to collect. Inflation and other economic factors go into the prices of coins. Many of those same coins were expensive to collect decades ago too. You could also relate this to most any thing that is a consumer good that we purchase whether it is physical or perceived.
Typically it's one or two cherry picks that made up for the 98 or 99 mistakes.
Well said.
If you are worried about costs, stick with auctions. The coins will sell for the market rate. Many times you will find coins at auction and then relisted at higher a BIN later. You just have to win the coin at auction.
Some coins have been getting progressively more expensive but others are getting less expensive, e.g. classic commens, modern NCLT, etc.
It honestly depends on what you collect. You can collect a relatively inexpensive specialty or perhaps just collect lower grades. If you have a specific idea in mind, let me know and I will help you find a cheap option.
YN Member of the ANA, ANS, NBS, EAC, C4, MCA, PNNA, CSNS, ILNA, TEC, and more!
Always buying numismatic literature and sample slabs.
Just be picky. When I first started in the hobby, I bought everything I liked and rarely faired well when I sold a piece due to an upgrade in the set. Now, I am far more disciplined and I don't chase crazy prices. The number of coins I purchase per year has significantly dropped. However, the ROI has significantly increased, which has made the hobby far more enjoyable for me (and far more palatable for my wife
).
Wow... 50% margins.... I realize dealers (especially B&M's) have costs to cover, however, I did not think their margins were anywhere near that on coins... Yes, I have seen some dealers - at shows - with prices that likely approach that level... Those were not common and I did not do business at such tables. For the most part, I see prices in the reality zone, except for the now popular tarnish premium (which, of course, is not an issue for me
). The tarnish premium certainly will put a coin in that category, so perhaps that is where you are encountering such prices. Cheers, RickO
One needs to tailor coin investment to their budget. Don't be swayed by the big spenders - we have entered the summer doldrums. In this market sellers wb taking a bath especially ones buried in big ticket numismatic material having overpaid when they bought not cognizant of market dynamics, conditions, risks.
I think PCGS MS 69 ASE for BV plus less than slab cost fun to collect. If silver goes up.......will payoff too.
Buy what you can afford and find fun. Take responsibility and do your homework.
Dealer margins high? At recent show set up bought NGC and PCGS MS69 MWG offered to me at melt plus roughly slightly less slab cost from 2 dealers, really super deal on the most liquid material. When packing up go home bought several MS63 Morgan Dollars offered me at $45 each that's $6 below bid, nice CH BUcoins / good deal.
I'm in the toner market and see margins as high as 70% when compared to auction market rates so you really have to know the market to avoid getting buried. In addition to the popularity of toners, another area that can have high margins is esoteric items with low demand, where I've seen 50% margins. Because sales velocity can be low, high margins are needed for each piece to help cover other slow selling inventory. Of course, I still like and collect esoteric items.
When it comes to retail prices (vs. auctions), high margins / prices exist so you need to know the market. If you do, you can also sometimes negotiate prices closer to market rates.
I could not afford this hobby as a boy, or a man. Now, with one foot in the grave, I wonder why I ever paid more than a dime for a nickel.
Cost is nothing, just start looking at your change.
so we can put em in jail! .
If I was a dealer I'd take a 10% profit on any slab coins that is in my showcase.
I don't know dealers that make 50%
But what does their profit matter to you?
If the coin is a great coin and priced right to you buy it.
If you don't love the hobby stay out.
There is always a sector of the market that is too expensive for me and one that isn't of interest to me. I assume others feel the same.
The US coin market is eventually going crash into a wall. There are too many dealers chasing the same coins ( PQ, original surfaces, etc.). Well, most of that is already off the market. What are we supposed to do ? Buy crap ? Probably not. I don't know how this is going to work out. I welcome any input on this.
When I was dealer I worked on a 10 to 20 percent margin almost all the time.
The only time I ever would have gotten to 50% was when I pulled something out of my collection that I had owned for 20 years. Yes, it is ethical to charge the current market for items. But I only did that a couple of times since pieces usually stya my collection.
I couldn't have said it better.
@STEWARTBLAYNUMIS just mentioned a coin with a 92.85+% margin in this thread: Be Wary of Fake/weak variety 1858/7 Flying Eagle Cents:
Here's one I posted a while back offered with what may be a 47% ($210,999) margin. In addition to the 50-70% margins I mentioned, I'm currently tracking (and interested in at the right price), a coin in the 5 figures with a 97+% margin. I also recently saw a four figure coin offered at a near 60% margin which I was able to purchase for about a 45% margin.
It's important to understand what you are paying for and decide whether you want to play.