Would you spend 7-10k on a coin with zero investment appreciation potential?
Tomthemailcarrier
Posts: 631 ✭✭✭✭✭
There are some coins that I'd love to own that I just can't justify buying. It'd be different if I were younger, but I'm 60 and semi-retired. I like high quality coins, so I know that I wouldn't be happy with a low grade example of any coin.
Examples of what I'm talking about include a high grade 1937-d 3 legged buffalo, pine tree shilling, any lower denomination coin dated 1798,1799, a high grade 1955 double die cent. Many of these are coins that I have always wanted since I was a kid.
Instead, I find myself focusing more on Carson City gold and other high grade rarities. In a way I wish that I were able to ignore price appreciation potential. I do love the history of CC coins, so perhaps that is the sweet spot for me.
How do you approach this issue? Does it matter very much to you. I appreciate any thoughts that you might have since there is a lot of knowledge on theses boards!
Examples of what I'm talking about include a high grade 1937-d 3 legged buffalo, pine tree shilling, any lower denomination coin dated 1798,1799, a high grade 1955 double die cent. Many of these are coins that I have always wanted since I was a kid.
Instead, I find myself focusing more on Carson City gold and other high grade rarities. In a way I wish that I were able to ignore price appreciation potential. I do love the history of CC coins, so perhaps that is the sweet spot for me.
How do you approach this issue? Does it matter very much to you. I appreciate any thoughts that you might have since there is a lot of knowledge on theses boards!
0
Comments
However, there is always a big downside risk when you spend too much, especially in this market. It may have farther to fall.
No, coins are an investment.
All purchases are technically "investments". Some just happen to be more risky than others. Some have guaranteed returns, some don't. Some have extravagant returns, some will leave you without your shirt. I believe coins fall in all of these categories except for "guaranteed return".
Now I collect strictly half dimes and when I got back into collecting I decided I didn't need screamers and I'd go with more circulated condition coins. That didn't last too long because I'm a sucker for nicely toned coins, especially if they're blue. Now I have a mix of what I feel are nice eye appeal lower grade circulated examples and AU beauties with a few MS mixed in.
I guess it comes down to simply liking a coin for what it is and snatching it if it's in my budget. If I make money someday that will be a secondary bonus but I'm sure I'll at least break even. What matters is that I'm having fun.
Great transactions with oih82w8, JasonGaming, Moose1913.
If you answer no, you are not a collector. Many folks will argue, but not every "Collection" purchase can be an investment in terms of hoping to get more out of the piece than you put in. It just does not work that way.
Why not?
Why can't it work that way if you buy smart.
Yes a SMART collector could answer No.
If you answer no, you are not a collector. Many folks will argue, but not every "Collection" purchase can be an investment in terms of hoping to get more out of the piece than you put in. It just does not work that way.
So how much money do you have to invest in coins before you become a collector?
Within my price range, I sometimes buy coins with zero investment potential, but usually will avoid coins that I think are at risk for a big drop in price.
My Adolph A. Weinman signature
My answer to OP thread title -- no!
My answer to the OP question -- of course!
Why would anyone flush 7k-10k down the toilet unless you are so minted you burn money for kindling...
But that's not the OP posting, buying therein stated coins is different because they have a market and could be sold. Now they might not be sold for 7k-10k, maybe less and maybe more, but odds are that if you are buying the coins in your OP and they priced fairly, they will appreciate/depreciate with the market trends and when they are sold, they will still sell for what they should sell for at the time.
Net-net, the coins you stated/scenario you paint is not aligned with the title of the thread.
if you would have said "with possibly zero investment appreciation potential," I'd bet the responses might be different.
My feedback -- definitely buy the coins you stated if they make you happy, and when someone sells them there will be a market for them and they might sell for more/less, but who cares if you enjoy owning them.
But don't buy a coin for 7k-10k that is worth $0 -- I know I'm stating the obvious
Historically, people seem to do best when highly educated, when they collect what they're passionate about, and when they hold for long periods.
As a dealer, I have to ask what I can sell it for because I would not stay a dealer long if I did not.
As an investor, I do not "collect" coins. And if you are only buying things you can assure only make you a profit, then, by definition, you are an investor.
One is not better or worse than then other. Just calling it what it is. It does not mean that many of the items I bought for my collection would not result in a profit if I were selling them, it is just not my motivation for buying.
So going into it I'm already down 10%
But since coin collecting is my hobby, I don't really think about what I could sell it for. I bought it because I need it.
Investing is putting money into something that will pay you a rate of return over time, or that you can force instant appreciation on, or that you can buy at a significant discount to it's current value.
I often buy coins for my personal collection that I will not be able to profit on period, but I buy them because I like them.
No for the business, I have to buy at price in which I can turn a profit, many times this means putting a coin back down, even though I would like to have it in inventory and be able to offer it, but just cant as there is no way to profit from it.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
Coin Rarities Online
I don't know that any coin that costs sells for thousands of dollars can have no investment potential. That price indicates a following and some rarity. Both of the factors hold out the chance that the piece might be worth more in the future.
Case in point. At the last Heritage Signature Sale, my Heritage rep told me to pass on two lots about which I had questions, but listed minor problems re the third lot and said "it's still a nice coin, I like it." He expected the coin would hammer for $1,000. The coin was a generic Liberty Nickel in PC 6 in an OGH.
I backed out the commission and sales tax I'd have to pay if I won the lot and put in a bid. The coin hammered for $5,000. Someone thought it would upgrade. From what my rep said, I don't think so.
This happens all of the time. Someone - not me - is buying these coins. I'll never know whether they make or lose money on them, but I'd never do this with my money.
Still can't figure out how to make new paragraphs with the new software.
"Seu cabra da peste,
"Sou Mangueira......."
“I may not believe in myself but I believe in what I’m doing” ~Jimmy Page~
My Full Walker Registry Set (1916-1947)
https://www.ngccoin.com/registry/competitive-sets/16292/
True. But sometimes, coins are priced crazily, unreasonably, or otherwise way ahead of the perceived market value. And at some point, the price is so high that a purchase can only be justified with the heart, not with the head. It would not be unreasonable to say that such coins essentially have no investment potential.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
No.
Next question?
Even if I HAD that much to spend on a coin, which I assuredly do not and may never have, I couldn't flush that much down the toilet for a hobby that gave neither I nor my heirs some possibility of a tangible return. And I don't mean a profit, necessarily. Just something back beyond the joy of ownership and learning and other intangible benefits of collecting.
How do you know which coins have "zero investment potential"?
Someone needs to field this obvious question. It was the first thing that popped in my head and thus I couldn't begin to form an answer
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......
I like to spend 10 dollars for a 10 dollar bill.
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
"I only golf on days that end in 'Y'" (DE59)
1. 1795 Draped Bust dollar in Xf-40
2. 1909-s Vdb cent RB 66
3. 1955 doubled die cent Ms-65 BN
4. 1937-d 3 legged Buffalo nickel MS-64
Each of these coins are ones that I'd like to own but have a problem with the numbers. I love coins. When I was a kid in the 60's I searched my paper route money and bank rolls to fill my albums. The idea of buying coins, other than the $2.10 U.S. Mint proof sets was foreign to me.
Now that we must buy the ones we want I do consider the numbers. I realize that one option is to collect a lower grade of a series for fun. Maybe I'll do that. I really wish that it made economic sense for me to buy the listed coins. I just can't seem to do it.
I do value everyone's response to my query. I love coin collecting and do enjoy reading the posts. It is good to have fellow collector's to share information with. My wife is into dog sports and has little interests in coins. She is willing to listen just a bit though, but not enough.
The other thing is the pricing information you're using. For the coins you've listed, I'd go with auction records rather than any price guide. Also, did these coins hit a high peak 10 years ago? Given how the economy has performed over the past decade, I'm not surprised that prices for these coins peaked a decade ago, but their prices may have hit highs that have proven to be unsustainable.
The other question - and I know you're concerned about this, is whether a 10-year holding period is too short for these coins.
Check out the Southern Gold Society
No, coins are an investment.
Spoken like a true collector...
Not. Not everyone is in it for the $$$. Lots of collectors are not concerned with their ROI.
In the past, I liked coins so much and could not afford them I start buying and selling coins and put the profits in my personal collection. That collection became huge.
I then put half my personal collection up for sale as inventory on my error coin website.
I continue to buy coins for inventory as well as for my personal collection.
I think you are being led a line of bs when they say that coins are not an investment. And this is coming from a dealer. I now believe all coins should be viewed as an investment, but I have not always been that way.
I have been all the way through the collector mentality from nuclear bids to knowing I was paying too much for a coin that I HAD to have to where I am at now.
If you answer no, you are not a collector. Many folks will argue, but not every "Collection" purchase can be an investment in terms of hoping to get more out of the piece than you put in. It just does not work that way.
With this definition, I'd say more than 90% of the this forum are not collectors.
I answered NO. I would not spend even $100 if I felt a coin had zero potential to appreciate. My collection of choice starting very early on in the 1970's was to buy under-rated Liberty Seated material. I'd bet John Pittman would be surprised to know that he was NOT a collector. The Norwebs or Newman probably weren't either.
The application of this logic would suggest that if ANY coin in your collection was purchased with the intent of potential appreciation....then you are not a collector. This is the age old argument that to be a purist collector you must be willing to lose 100% of what you spent on your collection and not care one iota. In other words, burn your money. I know some people that came pretty close at greater than 90%. They were indeed, "great" collectors.
What coins have limited longer term investment potential? Possibly those that peaked in price back in 1980 or the 1989-1990 bull market. Let's take this a step further. All those people that curtailed their buying during coin market down cycles (ie 1980-1982, 1990-1996, 2008-2011, and even 2nd half of 2015) are not true collectors. And those that refused to buy the "right" coins available to them in the market heat of 1979-1980, 1989, 2007-2008, are also not true collectors for the simple reason is that the direction of the market and/or price influenced their buying decisions. Sorry Charlie, you're not good enough for Starkist Tuna. For a purist collector we want no thoughts of purchase price, potential, investment, coin market cycles, etc. If you dare to consult a price guide of any sort at any time, you could be in danger of your losing your Local 12 Collector Card privilege.
I've changed my mind. There is not a single "collector" on this forum.
.....I like high quality coins, so I know that I wouldn't be happy with a low grade example of any coin.
This is a very subjective area. What's a low grade example to you might be a winner to the next guy.
Examples:
I ran across a fairly comprehensive collection of dated raw half dollars from 1794-1940's around 27 years ago. I didn't know exactly what to make of the 1797 half. It looked "low grade" to me.....in other words AG at best with the rims worn well into the lettering. It was missing some peripheral details too that I was used to seeing on capped bust halves. While a rare and very desirable coin, I passed on it because of a lack of understanding. I didn't understand it was actually a high quality coin for the grade. A dealer came in after me and purchased it. It turned out to be a strong Good (Good 6?) for the grade...and under-priced by approx 30%. Some collector would have killed for that specimen in that low grade. Low grade, problem free coins of many desirable type coins and key/semi-key dates are quite desirable.
My last seated coin purchase was an 1843-0 lg O quarter in Poor-01. Very low grade for sure. The lowest grade seated coin I own by a huge margin. But where do you find problem free, "wear" only, key date coins? The finest known of that date/mint/var. sold in the $20K's. My coin could easily be the worst known of approx 100-200 pieces known. I probably have nearly as much satisfaction owning the $7 coin vs. the $25K one.
How do you know which coins have "zero investment potential"?
These are the coins that most of us buy.
NGC registry V-Nickel proof #6!!!!
working on proof shield nickels # 8 with a bullet!!!!
RIP "BEAR"
Tyler
.....I like high quality coins, so I know that I wouldn't be happy with a low grade example of any coin.
My last seated coin purchase was an 1843-0 lg O quarter in Poor-01. Very low grade for sure. The lowest grade seated coin I own by a huge margin. But where do you find problem free, "wear" only, key date coins? The finest known of that date/mint/var. sold in the $20K's. My coin could easily be the worst known of approx 100-200 pieces known. I probably have nearly as much satisfaction owning the $7 coin vs. the $25K one.
I'm a huge fan of whatever turns you on
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......
Also, good coins are a good storehouse for readily available funds. Funds that we likely wouldn't have saved and would have blown on intangible items, had it not been for the coins.
I have made money, even in the very short term, on many coins and I know that I'll likely make a lot of money in the long run.
But for many of us, even if we just broke-even (very worst case scenario from an ROI standpoint and just hypothetically speaking); that's still a lot of money for many of us, although I KNOW that we'll very likely do much, much better than that, if we are smart when we sell and hold longer term.
“I may not believe in myself but I believe in what I’m doing” ~Jimmy Page~
My Full Walker Registry Set (1916-1947)
https://www.ngccoin.com/registry/competitive-sets/16292/
A dealer reports them on 1040 Sch C
A collector reports them on 1040 Sch D
l
It's not having what you want, it's wanting what you've got.
of course).... Cheers, RickO
Two weeks ago, I picked a scarce VAM worth 10-15X the original cost and despite the slabbing fees.
Who knows where the coin market will be in three decades.
Sixty is young... What part of your net worth do you plan to invest/collect and might losses create hardship at eighty?
Sixty is young... Why not start as a part time or vest pocket dealer to help subsidize the hobby for the next thirty years?
Actually if you are an honest US Citizen, ALL COINS ARE INVESTMENTS
A dealer reports them on 1040 Sch C
A collector reports them on 1040 Sch D
A dealer can report them on Schedule D as well if they specifically purchased for investment/their private use and socked away.
A "collector" can also report things on Schedule C if they are also maintaining some sort of part-time rare coin trading/dealing.
It's all about intent and documentation. Being a collector doesn't mean you can't trade part time for profit. Same comment for a dealer being part collector.
I don't believe in any magic minimum number on what constitutes a good coin - it all adds up.
How do you know which coins have "zero investment potential"?
How do you know which coins have "zero investment potential"?
Better answered by you, let us know, you posed the question.