Buying the best quality you can afford …
tradedollarnut
Posts: 20,221 ✭✭✭✭✭
…doesn’t always work out. This eye appealing coin brought just a 14% total return over a period of two decades
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Better than a loss. Sometimes it just depends on timing.
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Not surprising by any means. Some go up, some go down, and some stay the same. Census information probably made an impact. I'm sure everyone agrees that coins are a much lower returning "investment" compared to safe, long-term options such as an index fund. If you are looking for substantial return, shop your money elsewhere, not in coins.
"But seek ye first the kingdom of God and His righteousness and all these things shall be added unto you" Matthew 6:33. Young fellow suffering from Bust Half fever.
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I could only buy something like that if I passed on buying the rarer items. Everything is a compromise unless you have infinite resources. My Trade Dollar is a PR-64.
A little worse than a savings account, but DANG! You got to own THAT coin for 20yrs, which has got to be worth a couple percent a year, right?
All those coins I bought back in 2006 that were the best quality I could afford (considered dreck by many here) are worth less today, even in absolute dollars, than I paid. I’m just trying to get my value from the ownership.
Regardless of inflation, I’d still be pretty happy that I got more than I paid.
ROI is a gamble with coins, too many uncontrollable factors in play.
My Collection of Old Holders
Never a slave to one plastic brand will I ever be.
Coin sold raw in 1988 at $22,000. Was the highest realized price of the amazing Silberman trade dollar proofs. This is the reverse featured on the cover of the auction catalog
Better than no return
Coin collecting is a hobby. I golfed twenty years ago. Those rounds are completely worthless today. Should have put that money into the stock market I guess
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$5 Type Set https://www.pcgs.com/setregistry/u-s-coins/type-sets/half-eagle-type-set-circulation-strikes-1795-1929/album/344192
CBH Set https://www.pcgs.com/setregistry/everyman-collections/everyman-half-dollars/everyman-capped-bust-half-dollars-1807-1839/album/345572
Still in the NGC holder with no sticker probably had some impact, rightly or wrongly.
That cover photo and provenance is pretty darn cool!!
"But seek ye first the kingdom of God and His righteousness and all these things shall be added unto you" Matthew 6:33. Young fellow suffering from Bust Half fever.
BHNC #AN-10
JRCS #1606
I've heard, "Buy the best you can afford" for my entire life.
That certainly is an example where that simply didn't hold true.....
Great looking coin though.....
If you're in this game as an "investment," you're in the wrong game.
Sure, we can make careful choices, to minimize the likelihood of bad results. But these are nonessential goods, whose market values fluctuate wildly and, to some extent, randomly. High end coins seem, to me, to be "safer" than less expensive coins, but nothing is guaranteed (or particularly safe) in the coin collecting world (in terms of investment return).
That's a heluva coin. But if "investment return" was what you were after when you bought it, you made an unwise investment decision, IMO. Sorry.
Expensive coin needs to sell at the right time because not many can buy it
Another example like that is the 1878-S half dollar. Len Augsburger (Gobrecht Journal 2023) tested the adage on 3 coins (the key, a semi-key, and a common date) in 3 different grades from each the seated Liberty coin denominations and found that low-grade 78-Ss (AG3-Fine) performed better than the AU/MS coins from 1960 to 2023. I suspect it's SLH desperadoes competing to grab one of the more affordable examples to complete their sets. Lenny felt that the large number of MS and AU specimens (>$90K) creates more competition for the lower grade examples (<$55K) and compresses the grade/price profile. Otherwise, the adage seemed to hold up for 15 of the 21 coins examined, with UNC coins performing better than lower grades.
(Bill Bugert, 2020, A register of 1878-S Libert Seated Half Dollars, p. 7)
Lenny felt that though the adage of "buying the best quality you can afford" holds true for most examples, he felt "buying the key coins first" was an even better strategy for collectors.
You buy the best you can afford to enjoy the coins while you have them. At the end of the day you hope to recover most of what you put into them but understand the market goes up and down.
My Dad bought me one share of GM stock at $96 in 1966 when I was 13 years old to teach me about the stock market. Many years later the GM stock went to zero.
Nowhere in Bruce’s post does it read that he intended for this purchase to be a great investment, but I think it’s fair to acknowledge that the old adage of “buying the best you can afford” is not always necessarily the best financial decision. There are a number of lower end coins he could have purchased at the same time and made a 4x return.
He could have purchased a decent lettered edge slug in au58 for the same money, and it would have sold for closer to 200k.
I think a better takeaway is that the type of coin being purchased can have a much more substantial impact on future value, rather than the level of quality.
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Rather than buy the best quality that I can afford, I'll buy the best quality that makes sense. If there's a big jump in price at the next higher grade, I'll buy a nice coin in the next lower grade and then use what I save to buy other coins.
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire