Has the market for Pattern coins diminished quite a bit in the last few years.

CaptainRon · May 26, 2011 12:03AM

Has prices for patterns been falling in the market lately? Do you see this trend continuing?

MrEureka · May 26, 2011 1:42AM

prices for patterns been falling in the market lately? Do you see this trend continuing?

I'd say that the market has, to use an overused word, bifurcated. The rarest and sexiest patterns are stronger than ever, substantially due to Legend/Simpson activity, but also due to the general strength of the market in the best coins of all types. But the rest of the pattern market has softened, perhaps 20% on average in the past (roughly) 5 years.

This is due to various factors. First, the investment oriented retailers (who used to take a fair amount of "product" off the market) have been more focused on bullion related issues. (Mainly because bullion has been on a tear, but also because increased market transparency has made it more difficult to mark the coins up as much as in the past.) Second, a number of pattern collections have come to market to satisfy the Legend/Simpson demand, and many of the coins that were not wanted by L/S weighed on the market. And third, the L/S dominance of the market in the best patterns has discouraged other collectors, some of whom have sold their collections, and others who have, at least temporarily, shifted their attention elsewhere.

So will the trend continue? In my opinion, yes, and probably for another 1-3 years. That said, now is a great time to pick up an occasional great coin at a very attractive price. For example, in the past year, I've had a couple dozen high R-7 and R-8 patterns in top grades, and about half of them were an absolute bear to sell. The market is just too thin right now. But if you're patient and careful, there are some incredible values to be had. In fact, I believe that some patterns are some of the greatest values in the market right now. So even if the market takes a few years to find its base and start advancing, I think it's a good time to be accumulating some great coins.

Lakesammman · May 26, 2011 2:08AM

And couldn't have said it HALF as well.

CoinKing · May 26, 2011 2:24AM

<< prices for patterns been falling in the market lately? Do you see this trend continuing?

I'd say that the market has, to use an overused word, bifurcated. The rarest and sexiest patterns are stronger than ever, substantially due to Legend/Simpson activity, but also due to the general strength of the market in the best coins of all types. But the rest of the pattern market has softened, perhaps 20% on average in the past (roughly) 5 years.

This is due to various factors. First, the investment oriented retailers (who used to take a fair amount of "product" off the market) have been more focused on bullion related issues. (Mainly because bullion has been on a tear, but also because increased market transparency has made it more difficult to mark the coins up as much as in the past.) Second, a number of pattern collections have come to market to satisfy the Legend/Simpson demand, and many of the coins that were not wanted by L/S weighed on the market. And third, the L/S dominance of the market in the best patterns has discouraged other collectors, some of whom have sold their collections, and others who have, at least temporarily, shifted their attention elsewhere.

So will the trend continue? In my opinion, yes, and probably for another 1-3 years. That said, now is a great time to pick up an occasional great coin at a very attractive price. For example, in the past year, I've had a couple dozen high R-7 and R-8 patterns in top grades, and about half of them were an absolute bear to sell. The market is just too thin right now. But if you're patient and careful, there are some incredible values to be had. In fact, I believe that some patterns are some of the greatest values in the market right now. So even if the market takes a few years to find its base and start advancing, I think it's a good time to be accumulating some great coins. >>

If Andy says it, you can count on it.

Zoins · May 26, 2011 4:14AM

Is there a pattern in the "rarest and sexiest patterns" vs the others? For example, do the high demand pieces generally comprise essai vs other types, say die trials, fantasy pieces, etc.? I'm wondering because it seems like most of the pieces posted in pattern threads here are essai.

MrEureka · May 26, 2011 6:40AM

Is there a pattern in the "rarest and sexiest patterns" vs the others?

The "rarest" and the "sexiest" are sometimes only one or the other. The rarest are simply the ones with the fewest pieces known. The sexiest are usually exotic, beautiful and popular. Examples of "sexy" patterns are the Schoolgirl Dollar, the Washlady series, all 1877 Half Dollars, all 1792 patterns, all patterns struck in gold, etc. Naturally, some of the sexiest patterns also happen to be among the rarest. I'm not sure if that answers your question...

oreville · May 26, 2011 7:00AM

<< If Andy says it, you can count on it. >>

Agreed.

DaveE · May 26, 2011 9:39AM

Andy you are sort of right, but not 100%.

There are plenty of values out there that are NOT R-7 or better. You can buy a J-410 1865 3CN in PR65 for LESS then it would cost you to a buy a regular Proof! If I was building a 3CN Pr set, that would be a neat addition. Or how about the R-5 J-295 1862 Silver PCGS PR65 50C that just sold for $5,450.00? A regualr PR 65 one of these is about $7,000.00 and has 550 minted. There are many smart values in patterns if you just look.

Also, I happen to know Legend has reinvigorated the pattern market to a degree. Between the publicity, the huge purchases, and having tons of crediblity, Legend has created a new group of pattern collectors. Clearly, Simpson is not sucking up all the high end patterns, they do have other customers.

Patterns will not be a whisper much longer!

MrEureka · May 26, 2011 1:34PM

There are plenty of values out there that are NOT R-7 or better. You can buy a J-410 1865 3CN in PR65 for LESS then it would cost you to a buy a regular Proof! If I was building a 3CN Pr set, that would be a neat addition. Or how about the R-5 J-295 1862 Silver PCGS PR65 50C that just sold for $5,450.00? A regualr PR 65 one of these is about $7,000.00 and has 550 minted. There are many smart values in patterns if you just look.

Dave - I never said that the values were only in the R-7 and up coins, and I agree that there are many values to be had in some of the more "common" patterns. As for the specific examples you give, I think you're making a critical error in your logic. Let's talk about one of them. J-410, the pattern 1865 3CN, is indeed far rarer than the regular dies proof. But few of the people trying to build complete sets of 3CN proofs feel that they need the pattern, and that is unlikely to change. Bottom line is that there are not enough regular dies proofs to go around, but there are more than enough J-410's. Remember, it's all about supply and demand. Of course, at some price the J-410 can be a great value, and even a great investment. But if you start comparing the prices of the patterns to the regular issues, you're likely to overestimate the value of the pattern. Can't stick around right now, but maybe tomorrow we can talk some more about which coins I consider to be the best values at current levels. I'd be curious to hear your thoughts about those.

dbcoin · May 27, 2011 12:29AM

Very interesting thread. Is there a "Patterns for Dummies" book that can get me started? Sounds like an interesting way to collect coins vs just putting together date/mm sets

MrEureka · May 27, 2011 12:56AM

Patterns for Dummies!

frnklnlvr · May 27, 2011 1:14AM

Here's my favorite pattern. One I will likely never own.

J-A1948-2

dbcoin · May 27, 2011 1:17AM

<< Patterns for Dummies! >>

Thank you!!!

Manorcourtman · May 27, 2011 11:06AM

Any idea how many Pattern collectors there are in the US?

MrEureka · May 27, 2011 12:48PM

Any idea how many Pattern collectors there are in the US?

It depends on how you define "pattern collector". Wild guesses? There may be 40-50 collectors that take US patterns pretty seriously, and another 500 that casually acquire an occasional coin.

PerryHall · May 27, 2011 9:35PM

<< Any idea how many Pattern collectors there are in the US?

It depends on how you define "pattern collector". Wild guesses? There may be 40-50 collectors that take US patterns pretty seriously, and another 500 that casually acquire an occasional coin. >>

Sounds like a very thin market although the supply of quality patterns are very thin.

DaveE · May 27, 2011 11:38PM

The pattern market is no thinner than the market for 3CS.

You will never see many registry sets because the series is too long and too expensive. However there are without question hundreds to thousands of people who do buy patterns for many reasons. If there were not, you would not see entire collections the size of Lemus (sold by Heritage 2 years ago) sell to so may different people with so much bidding.

There actually is a decent size supply of patterns-but they are with more specialized dealers. You'll see fewer GEM MS 3CS (try finding an 1857 in MS65/66 or a 1867 in MS65). With a little work you absolutely CAN find R-7 patterns (4-12 minted).

While it is true Legend tries to buy all the high end Patterns, they do not end up with Simpson. They do sell to many other high end buyers-a staggering number I am told.

MrEureka · May 28, 2011 3:43AM

If you're looking for a specific pattern, the supply may indeed be extremely thin. But there are about 2000 different patterns, so there's always something to buy.

Dennis88 · May 28, 2011 4:11AM

I completely agree with Andy's comments above (who am I to disagree with one of the foremost pattern experts out there). The Legend/Simpson collection has had tremendous influence on prices of R-7's and R-8's. Since I believe that collection will be off the market for many decades to come one has to wonder what this will do with the prices for lower grade R-7's and R-8's that are still out there.

I published an article recently in the Gobrecht Journal (publication of the Liberty Seated Collectors Club) on off-metal Liberty Seated coins. Mostly produced to be sold to collectors, they represent tremendous values, like Andy said patterns in general do. My favorite are the Aluminum pieces that are out there. Aluminum was considered a semi-precious metal trough out most of the 19th century and those must have had a relative heavy price tag to produce compared to, i.e., copper off-metal coins. Yet, in gem, they are often cheaper (if you can find them) than regular Proofs.

As for the early 1860s "IN GOD WE TRUST" pattern half dollars that were mentioned above, one has to remember that those are relatively common (mostly R-4 to R-6), and there are less collectors looking for them compared to regular Proofs. This is something that you come across a lot in the pattern series right now; until more collectors start actively collecting them (and there are many possibilities to collect Pattern sets without having to buy 100+ coins like the registry makes us believe) prices will most likely stay stable, like they have been the last decade or so.

I'm somewhat partial to the 1850-1859 patterns for a small cent coinage. Just so much history in those

Dennis

MrEureka · May 28, 2011 5:10AM

Now, how thin is demand? In most cases, it is impossibie to find somebody that is specifically looking for the one pattern you have, but you can always find someone who would simply like to have it. What that means, in practice, is that prices are usually determined by casual buyers that don't need your coin, so prices are reasonable. A nice situation if you're one of the few serious collectors of patterns!

Dennis88 · May 28, 2011 5:19AM

<< Now, how thin is demand? In most cases, it is impossibie to find somebody that is specifically looking for the one pattern you have, but you can always find someone who would simply like to have it. What that means, in practice, is that prices are usually determined by casual buyers that don't need your coin, so prices are reasonable. A nice situation if you're one of the few serious collectors of patterns! >>

True. I sold an 1875 20 cent pattern in copper by William Barber (J-1404, R-6) to a dealer recently without any problems. If it was a pattern with very minor design differences I doubt I could have sold it that easily.

I'm sure that some exciting patterns with different designs are much easier to sell to the casual buyer of patterns than, say, an 1863 Bronze Indian Head Cent (J-299, R-3). But how big of an influence have these casual collectors on prices of the more exciting patterns?

Dennis

MrEureka · May 28, 2011 11:15AM

Or how about the R-5 J-295 1862 Silver PCGS PR65 50C that just sold for $5,450.00? A regualr PR 65 one of these is about $7,000.00 and has 550 minted.

J-295 is one that has a bright future, for a number of reasons. Forget the price for the moment. Let's talk about the concept. First, look at the coin. What is it? Why does it exist?

As stated on uspatterns.com:

"The "God Our Trust" pattern, a precursor to the familiar "In God We Trust" reverse motto used regularly starting in 1866."

Also, "About two dozen are known in silver. W. Elliot Woodward stated in his May 1863 sale catalog that 25 sets were struck."

A coin like this can have great appeal to a Seated Half Dollar collector, Civil War buffs, someone looking to document the story of the adoption of the "In God We Trust" motto on our coinage, a type collector, or almost any "casual collector". And if Woodward had his facts straight, there are only 25 coins to go around. To me, this sounds like a coin that should be in great demand, but it's not. In time, that will change.

Sonorandesertrat · May 28, 2011 11:49AM

MrEureka's reasoning sounds like a 'multiple-levels-of-demand' strategy.
A good way to think about relatively thinly-traded coins, such as patterns or early gold or....

Lakesammman · May 28, 2011 12:35PM

There will always be a demand for cool "patterns".

Lakesammman · May 28, 2011 12:37PM

Lakesammman · May 28, 2011 12:37PM

Ahmanfan · May 28, 2011 2:51PM

sorry, but what is a 'pattern' coin?
John

MrEureka · May 28, 2011 10:24PM

sorry, but what is a 'pattern' coin?

Quick answer: They're prototypes for coinage.

For a much better answer, click on the "Patterns for Dummies" link above.

MrEureka · May 28, 2011 11:08PM

MrEureka's reasoning sounds like a 'multiple-levels-of-demand' strategy.

Well, yes, it's all about anticipating future demand.

But really, my primary thesis is that the market has substantially undervalued about 15% of the patterns in the Judd book, because - drum roll, please - the market has failed to adequately differentiate between (what I will half-jestingly call) "real" and "fictional" patterns.

What do I mean by "real" and "fictional" patterns? Simply put, a "real" pattern is one that was made for the primary purpose of demonstrating something new, before that thing was actually accepted or rejected. A "fictional" pattern is one that was made for the primary purpose of selling it to a collector. (Yes, there are some borderline cases, but I can live with that.)

To someone that opens the Judd book for the first time and spends only 30-60 minutes with it, these distinctions will not be obvious. But if you spend a few hours reviewing the book with an eye towards this issue, it will become clear. Just keep on asking yourself two questions about each coin: "When was this coin struck?" and "Why was this coin struck?" I believe these things matter greatly, and I believe the market will at some point come to the same realization.

ColonialCoinUnion · May 29, 2011 12:19AM

<< What do I mean by "real" and "fictional" patterns? Simply put, a "real" pattern is one that was made for the primary purpose of demonstrating something new, before that thing was actually accepted or rejected. A "fictional" pattern is one that was made for the primary purpose of selling it to a collector. (Yes, there are some borderline cases, but I can live with that.)

To someone that opens the Judd book for the first time and spends only 30-60 minutes with it, these distinctions will not be obvious. But if you spend a few hours reviewing the book with an eye towards this issue, it will become clear. Just keep on asking yourself two questions about each coin: "When was this coin struck?" and "Why was this coin struck?" I believe these things matter greatly, and I believe the market will at some point come to the same realization. >>

Interesting - I had not heard that before.

MrEureka · May 29, 2011 1:01AM

the market has substantially undervalued about 15% of the patterns in the Judd book

To be clear, I'm not saying that only 15% of the listed varieties are "real". The number is more like 20-25%, but only 15% are unappreciated. (And those are very rough numbers.)

Mark · May 29, 2011 1:17AM

Andy:

I agree with your division between "real" and "fictional" patterns. That said, I always thought J-295 was "fictional" because I thought it was struck after the fact, that is, the coin was not actually used to determine if "God Our Trust" would be the motto placed on our coins. Am I wrong in my belief? (If so, sadly, it won't be the first time and, even more sadly, definitely won't be the last time either.)

Zoins · May 29, 2011 1:30AM

<< 

<< Is there a pattern in the "rarest and sexiest patterns" vs the others? >>

The "rarest" and the "sexiest" are sometimes only one or the other. The rarest are simply the ones with the fewest pieces known. The sexiest are usually exotic, beautiful and popular. Examples of "sexy" patterns are the Schoolgirl Dollar, the Washlady series, all 1877 Half Dollars, all 1792 patterns, all patterns struck in gold, etc. Naturally, some of the sexiest patterns also happen to be among the rarest. I'm not sure if that answers your question... >>

Thanks Andy. That's good info. I'm still trying to get a feel for demand and supply on patterns and this helps.

Zoins · May 29, 2011 1:35AM

<< But really, my primary thesis is that the market has substantially undervalued about 15% of the patterns in the Judd book, because - drum roll, please - the market has failed to adequately differentiate between (what I will half-jestingly call) "real" and "fictional" patterns.

What do I mean by "real" and "fictional" patterns? Simply put, a "real" pattern is one that was made for the primary purpose of demonstrating something new, before that thing was actually accepted or rejected. A "fictional" pattern is one that was made for the primary purpose of selling it to a collector. (Yes, there are some borderline cases, but I can live with that.) >>

I don't necessarily think "real" patterns should always be worth more than a fictional one. For example, the 1913 V nickel and the 1804 dollar are highly valued but often considered fantasy pieces. However, if the value discrepancy exists, an easy to use reference to highlight real vs. fantasy may help.

Also, why not use the standard term "fantasy" as used in the USPatterns.com's cross reference and glossary?

MarkBen · May 29, 2011 4:22AM

For collecting patterns, NGC is easier to deal with than PCGS, because of the fees for Metallic Analysis (SEM-EDX)

For many patterns, it's really important to know the actual metallic content. NGC charges $75 to analyze the metallic content. By comparison, PCGS charges a whopping $180. PCGS is more than double NGC's cost. I don't understand why PCGS charges so much for this service, especially since their new "sniffer" should be able to perform the metallic analysis.

COALPORTER · May 29, 2011 5:06AM

<< For collecting patterns, NGC is easier to deal with than PCGS, because of the fees for Metallic Analysis (SEM-EDX)

........ "sniffer" should be able to perform the metallic analysis. >>

Does "Sniffer" do that? thought it just detects for foreign material like putty and traces of other chemicals.

Dennis88 · May 29, 2011 6:29AM

<< 

<< For collecting patterns, NGC is easier to deal with than PCGS, because of the fees for Metallic Analysis (SEM-EDX)

........ "sniffer" should be able to perform the metallic analysis. >>

Does "Sniffer" do that? thought it just detects for foreign material like putty and traces of other chemicals. >>

No, it's another company outside of PCGS that does it (at least that was the case a few years ago). I have some results from coins sent in by both PCGS and NGC but am not sure what the company name is. Will look it up later today.

SEM-EDX is very technical and the machinery is not cheap, to say the least. SEM-EDX translates to scanning electron microscope utilizing energy-dispersive X-ray spectroscopy in normal English (ahum). It's very accurate and brings up very interesting results for many patterns (Rick Kay has done SEM-EDX research on the 1854/1855 Flying Eagle cents and because of that the Judd book revised many of their listed metals for those issues).

Energy-dispersive X-Ray spectroscopy on Wikipedia
Some more info on this website

Dennis

MarkBen · May 29, 2011 8:55AM

SEM-EDX is very technical and the machinery is not cheap, to say the least.

According to this article, the PCGS "sniffer" uses EDX technology:

Sniffer Article

The article also describes a "ray-gun" that can determine metallic content. So, it appears that PCGS does have the technology to perform metallic analysis. I don't understand why they charge $180 for that service, or why they still send coins outside if they have the technology.

MrEureka · May 29, 2011 11:19AM

I agree with your division between "real" and "fictional" patterns. That said, I always thought J-295 was "fictional" because I thought it was struck after the fact, that is, the coin was not actually used to determine if "God Our Trust" would be the motto placed on our coins. Am I wrong in my belief?

Woodward stated in his 1863 auction catalog that 25 pieces were struck and sold in sets, so they obviously weren't backdated.

MrEureka · May 29, 2011 11:48AM

I don't necessarily think "real" patterns should always be worth more than a fictional one. For example, the 1913 V nickel and the 1804 dollar are highly valued but often considered fantasy pieces.

I agree. "Realness" is hardly the sole determination of value. But in MOST cases, I'd value the "real" coin higher than a comparable "fictional" coin.

Also, why not use the standard term "fantasy"

I'm not suggesting that "fictional" is the correct term, but it serves my purpose in this thread for several reasons. First, "fictional" is less specific than "fantasy", so it can be used to describe fantasies, off metal strikes made for no other reason than to sell to collectors, illogical mules and all kinds of restrikes. Second, there's a lot of confusion out there regarding the meaning of "fantasy", so I certainly don't want to muddy the waters with that word. And third, I think the word "fictional" is suitably confrontational. Even more so than "dreck".

keyman64 · May 29, 2011 12:03PM

I wish it would DIMINISH A WHOLE LOT MORE so I can own a few pretty examples!

Mark · May 30, 2011 12:00AM

Andy:

Thanks so much for your response,

<< Woodward stated in his 1863 auction catalog that 25 pieces were struck and sold in sets, so they obviously weren't backdated. >>

That settles the issue for J-295!

I still have stuck in my memory that some of the "God Our Trust" patterns were fictional, to use your clever term. Am I totally off base here?

MrEureka · May 30, 2011 2:26AM

I still have stuck in my memory that some of the "God Our Trust" patterns were fictional, to use your clever term. Am I totally off base here?

Off the top of my head, all were initially struck in the dated years, although some may have been re-struck. I don't have a Judd book here, so I may be missing something.

My guess is that you're thinking of the 1863-65 "In God We Trust" issues, most of which were backdated. And this is a perfect segue into another suggested buy. If you can figure out which (if any) 1865 Transitional Dollar (J-434) is the original, and if you can buy one at a reasonable price, I think it would be a great "long term hold".

MrEureka · March 29, 2017 2:45PM

ttt

roadrunner · March 29, 2017 7:21PM

So nearly 6 yrs later. Are patterns still mostly sleeping? No doubt 2009-2011 was a rough time for most rare coins.

ArizonaRareCoins · March 29, 2017 10:50PM

So, many years later, I believe we're still in the same situation. I've noticed cent patterns (braided hair, flying eagles + 1858 Indians), gold patterns, George Washington patterns are commanding higher values while common patterns in the 1/2dime, dime, quarter and half dollar denominations are continuing to drop......especially the standard silver patterns. JMO:

Zoins · March 29, 2017 11:15PM

It seems that there are definitely certain sub-series of patterns that are more in demand than others and it's hard to just say how patterns are doing overall. Some patterns are rare and almost never available while others are readily available (though at a high price).

Has the market for Pattern coins diminished quite a bit in the last few years.

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