A Companion to Rare Coin Collecting - Are Rare Coins For You?

Rare Coin

Are Rare Coins For You?

As with other investments, there are many anecdotes about individuals earning enormous wealth from collecting coins. Yet, even the more believable stories are about people who spent twenty years or more patiently learning and developing their numismatic skills. Unlike stocks or real estate, collecting rare coins requires a deeper commitment to learning and dilligence to augment personal knowledge. For successful collectors, there is an emotional attachment to the art not found in traditional avenues for personal finance. In short, as a serious long-term investment strategy, collecting coins is not ideal for everyone.
There are three important prerequisites one should consider before engaging any investment strategy. The first is: Do I have long-term funds that can be committed for a number of years? The second: Do I have the ability to meet ordinary living expenses with other resources. The third: Am I confident of my knowledge of my target investment?
Having the long-term funds to commit to your investment is particularly important when you consider the nature of rare coins. As with other investments, rare coins require a minimum period of "holding" and, to reap the best investment earnings, timing is essential. Rare coins have demonstrated a pattern of growth spanning many years and, for those "hold" their investments over extended periods, profits are the rule rather than the exception. However, for those expect an immediate profit, the results are often disappointing. Keep in mind that some coins might suffer from overexposure and investors who purchase at the peak of a particular cycle may experience substantial losses if they sell into a softer market.
Meeting your ordinary living expenses is paramount over any investment activity. Never expose yourself to possible losses that could jeopardize your standard of living. Since rare coin investing is a non-income producing asset, it should never be viewed as a "savings account" to dip into as the need arises. While certainly capable of providing strong capital gains, rare coins serve mainly as an excellent vehicle for capital preservation, as well as a hedge against inflation and other forces which erode the value of more traditional paper assets.
Knowledge can mean everything. At least where investing is concerned, knowledge can be your best asset. Being able to "see" a good deal is probably just as important as "smelling" a bad one. Unfortunately, there are always those individual who are eager to feed on the naive and gullible. Nearly all of the horror stories surrounding bad rare coin investments concern people who knew absolutely nothing about what they were buying. Save yourself the grief and learn the basics before you buy.
This text discusses some of the many books, magazines and newsletters that are available on the subject. Reading them will help sharpen your ability to "see" and "smell" the opportunities you may find.

Go to Next Chapter "What is a "Rare Coin"?"


Rare Coins News
eBay: £2 coin sold for £379 this week - do you have one of these rare pieces?
eBay is one of the best places to find rare coins, including this £2. The 2002 Gibraltar £2 coin was sold on the auction site on Sunday for £379. A bidding war broke out over the item, after 11 bidders made an attempt to get their hands on the coin. more info

Rare two pence coins from the '70s are being sold on eBay for up to £14,000 - but do YOU have any in your wallet?
The coin is one of a handful which has gone on sale on the website in recent weeks, with an asking price of thousands, as those lucky enough to have one of the rare coins seek to cash in. Produced between 1971 and 1981, the coins features the words 'new ... more info

Rare SILVER 2p coin that’s worth £40 – do you have one in your pocket?
IT'S hunting season for coin collectors. From the launch of the new "A-Z" British 10p coins, to the 2018 Beatrix Potter collection, it's fair to say that interest has never been higher, with collectors eager to get their hands on the new coins. But while ... more info

Rare Paper Money Collection Worth $30 Million to Be Auctioned
Additionally, the prices for coins are far higher than than that of paper. A rare coin, according to Treglia, could set you back $30 million, but the most paid at the upper end of the of the U.S. currency market is $3.29 million for 1890 treasury note with ... more info

Collectors share the histories behind rare coins at Springfield trade show
Whether a modern quarter displaying a U.S. national park or a rare, hand-hammered Greek denarius dating back to 250 A.D., history is woven throughout the process and story of all coins, tokens and currencies, according to Monte Mensing, president of the ... more info

Christie's to auction rare watch once owned by Egyptian king
King Farouk, Egypt’s last king before a 1952 revolution overthrew the monarchy, was a collector of rare watches, a hobby inherited from his father, King Fuad. He owned Patek Philippe and Vacheron Constantin watches and also collected cars and coins. more info