“How do I know I’m collecting the right coins for successful investment?” is one of the most asked questions we get here at The Coin Wholesaler.
The answer, surprisingly, is: It really doesn’t matter what you collect. Bullion coins of interest to you? Then stock up on as many American Eagles or Canadian Maple Leafs as your budget will allow. Are old U.S. gold coins issued prior to 1933 your thing? Go for it! Dollars? Search out those silver Morgans and Peace Dollars. And don’t forget those Ikes or SBA's while you’re at it along with a few early date Sacs. Current issues?? Buffalo Silver Dollars, statehood quarters, Presidential Dollars -- they’re all out there just waiting for you. What you invest in is your choice. Enjoy it!
What’s most important to remember is, whatever your investment/collector choice, there are fundamental rules that must be followed to almost guarantee success over the long haul. They include:
Always Think Positive Serious investor/collectors get the most enjoyment and make the most money in rare coins. They’re constantly seeking out undervalued coins, buying them well below previous market highs and holding their coins patiently for years and then selling them into hot coin markets. They seem to have a “nose” for it. This is called “buying low and selling high“, a basic rule of investing in anything.
Don’t Sweat the Small Stuff Again, the astute and well established investor/collector knows that coins trade up and down in long - and sometimes short- market cycles and they can go down in price as well as up, due to the influences of good times or bad, stock market ups and downs, war and peace or even political situations. So investor/collectors - be ye he or she - don’t sweat the small stuff. Know that the only times the value of any investment - or collectible - is of great importance, is on the day one buys and on the day one sells.
Keep Rare Coins in Perspective Truly rare coins have a limited, fixed supply. Only a certain number exist, and no more are or can ever be produced. Historically, such coins increase in value when a wave of new collectors enters the marketplace and their demand seems to overwhelm their limited supply. This is known as The Law of Supply and Demand, which should always be considered in any investment situation. A rising market automatically drives up prices to entice the old-time collectors to sell their holdings. After all, how else can that growing demand be met? That’s called “timing” and is a huge factor in any enterprise. Also keep in mind: The Law of Supply and Demand can never be repealed!!
Plan Your Collection Buying a few coins here and there with no goals in mind can be lots of fun but doing only that can lead to a collection of lesser value which is harder to sell when the time comes. The successful investor/ collector will have a goal in mind and when that goal is reached, will set another goal for future investing. This is known as “planning your work and working your plan”, a guide to success in any business, or in this case, a very enjoyable hobby.
Patience Can Indeed Be A Virtue Throughout history, coin collections have produced substantial profits for their owners. One lucky investor/ collector, Harold Bareford, was said to have purchased a collection of U.S. gold coins for $13,832 in the early 1950s which was resold at auction in 1978 for $1.2 million. This points out the value of patience for success in the hobby over the long term. The wise investor/collector knows that large profits are not made overnight. Successful coin collectors buy coins for their beauty and historical significance -- or sometimes just because they like them. This proves the wisdom of the old collecting adage, buy for the fun and the profits will come.
Are You an Investor or a Collector? Collectors often view their coins as fine art objects and present day reminders of the cultural and economic forces that created them. Investor interest lies in the fact that coins of proven rarity - or of high precious metals content (usually gold, silver or platinum) often show high rates of return over time. However, as of late, the line between collector and investor is often blurred. Collectors, while appreciating the beauty and history of their collection, can’t help but now and then sneak a peek at the value of their holdings in the marketplace, and many investors suddenly realize their coins are miniature works of art and try to learn a little more about how those numismatic gems were created.
Thus the investor/collector gets to enjoy both sides of the coin - I mean of the hobby - he or she has learned to love. There’s the pleasure of acquiring beautiful and precious metals over the years along with the satisfaction of knowing that those very same items also represent a storehouse of exciting historic value.
So enjoy your coin collection, whether started by yourself when you were a kid and got an odd looking penny with an Indian head on it as change one day while you were buying bubble gum, or it began with the starter set given to you by your beloved grandfather as a birthday present back in the day. Keep up with it, add to it and enjoy it.
Why? Because it’s fun, it’s exciting, it teaches you a lot about the world we live in and about the value of things and also about saving for a rainy day. It all adds up to lots of fun and potential profit. There’s not anything better than that.
Best of all, it offers, along with “Saving for a rainy day”, that magical promise once engraved on those old-time encapsulated lucky pennies, “Keep me and never go broke.” |
