Traditional Rare Coin Investment
Early certified rare coins can offer balance to your core bullion holdings.
Here we offer a few rules, 2 trading secrets and a
sample of our type inventory. If you want to buy or sell
the rare or unusual call or email anytime.
So what does a model PCGS certified rare coin portfolio look like? Actually there are so many variations on this idea that the exact answer will not suit everyone, but my choices are a good place to begin especially if you are new to rare coin investment. To begin let me offer four reasons I believe everyone should consider placing a portion of their hard asset money into this area:
First the US paper dollar is vulnerable to uncontrolled government spending, worldwide political unrest, and liberal politics, all of which threaten its value and therefore your buying power. Certified rare coins have historically protected owners against this devaluation in paper money.
Second, the rare coin area is one of the few places left which offer complete privacy and favorable tax considerations.
Third, certified rare coins are still a relative secret when it comes to the public at large, so I believe past price appreciation is only a beginning.
Fourth, unlike volatile gold market these coins provide a financial blanket of protection and at the same time may offer a better night’s sleep. The bullion portion of your hard asset portfolio is important but is simply a choice between the US Gold Eagle, the South African Krugerrand or other low premium bullion coins. But what about the correct rare coin choices which provide diversification?
We offer a few rules to make sure you place your rare coin investment money in areas with readable price history, good market depth, and prices which are affordable to many investors. These are not the most expensive or rarest coins available but they represent value, are blue chips in their own right, and make a wonderful beginning to the correct certified rare coin approach. As for prices you will find that sometimes bullion coins will lead the way and sometimes rare coins take the lead so a little of both is a good bet.
WHICH ARE THE VERY BEST COINS?
Which coin should I buy for long-term investment and capital gains? That has to be the most asked question in this store over the past two decades. In fact no person knows for sure, but there are parameters, which will lead you in the right direction. Road signs, if you will, to follow in choosing the right PCGS certified rare coin. Such rules produce these “blue chip” choices that are the favorites of professionals and especially suited to new investors.
Are these rules of the investment road difficult? Absolutely not, and in many cases they are just common sense. But beware because some investors throw these simple rules to the wind. So here are a few guide lines to keep in mind which could dramatically increase your chance of profiting in the next rare coin boom.
THE RARITY VERSUS DEMAND SECRET
You would think that such things as rarity and price are pretty basic, and everyone would agree as to their importance when it comes to choosing the best coins. But just the opposite is true for a number of reasons. First, the investor should understand that rarity by itself is not the best way to approach investing. Rarity is good, but if there is no demand for a coin its rarity will be of little value. So it’s of paramount importance to link rarity with demand. Before you add a rare coin to your portfolio be sure it is popular. Some of the best investment coins may not be rare, but their popularity is so great that everyone wants an example. This can create an upward pressure on price and positive momentum is better sustained.
WHICH GRADE IS BEST?
Most investors know that all investment coins must be PCGS (The Professional Coin Grading Service) certified because this greatly enhances worldwide liquidity. Yes, there are other grading services, but PCGS is the leader. So if a friendly coin dealer tells you to consider other services show caution. Coins graded by The Professional Coin Grading Service are, on average, worth more when selling, and enjoy a wider market. So why settle for less? After all it’s your money and it’s an investment rule.
That being said, consider what makes grade or condition so important. All rare coins today are graded using the Sheldon Scale from 1 to 70. The higher the number the better the condition and the rarer the coin. As rarity and popularity increase, so does price. So the cornerstone of coin investing is relative condition. We are talking about how perfect the coin is in terms of marks or abrasions because desirability and rarity drive this market. Investors strive for coins in superb condition, and will pay for quality.
Now we know the better the condition the more money a coin is worth, but where do we draw the line as far as cost? Most investment coins fall between MS63 (Choice Uncirculated) and MS67 (Superb Uncirculated). The rule is to invest in the highest grade you can afford, but not get carried away. There must be a balance between the price of a coin and its condition. In smaller gold coins, for example, MS63 and MS64 grades seem appropriate, while larger $20 gold coins in grades of MS65 and MS66 are a better choice. In most silver coins, however, a grade of MS65 or MS66 represents excellent value.
INTERESTING STORIES ARE IMPORTANT
An investment coin with a story is always better than one without. Stories and the history behind them are important because they bring these real treasures to life. Not just for you, but for the next buyer of your coin. The more compelling the coin story the better your opportunity for profit and fun. It’s like location in real estate. An interesting or historical fact that relates to your coin is like ocean front real estate. It creates demand and insures attention. This provides more bidders which may push prices higher.
WATCH PRICE HISTORY CAREFULLY
Price history, or what a rare coin sold for in the past, is important. Most rare coins today have accurate price charts that go back to 1986. Ask to see them before you invest. This rule should never be forgotten because it gives the buyer a great way to judge price and allows a reasonable guess as to where the coin is heading given another round of inflation.
ALWAYS USE MARKET CYCLES
Using market cycles to your advantage is probably your most powerful investing edge available today. And the price chart or history of any particular coin will tell you where in the cycle you are and provide clues as to decisions. It just makes sense that if a rare coin can be purchased for substantially less than it sold for in the last big price move that there is better future potential.
People who develop a buying strategy are much better equipped to profit because they appreciate a long-term plan, which takes advantage of natural “up” and “down” markets. These types of folks make the best investors because they are not too concerned with the latest investment fad. They do their homework and stick with rare coins with a proven track record. A coin, which is rare today, will be rare tomorrow.
And here is another rule to keep in mind: “Don’t wait to buy quality coins. Buy quality coins and wait.” Patience in this market is golden, and history has shown that the big money payoff comes to those who invest over the long term.
So can we guarantee a profit? Of course not, and CNI will be the first to say that past performance does not guarantee future profits. But we believe that the past performance of coins, just like stocks, is worth watching. It is a great indicator of many things, including where the public has put its money in the past. Such information can be insightful and valuable.
THE KEY IS LOOKING FOR VALUE
Price history is important in your judgment as to whether a coin represents value. Like stocks some rare coins today can be purchased for less than their old highs which indicates to us that a value buy should be considered.
On the other hand there are coins which are trading on their highs, not that we would dismiss these possibilities, but we want to identify both sides of the spectrum and then balance your holdings. We are old time traders and suggest that value centers around blue chip certified coins which can be bought or sold for the right price.
And always follow The 50 Year Rule: This approach is powerful because it keeps the investor focused. Never invest in any rare coin which is not at least fifty years old because without an established track record the outcome becomes unpredictable.
CHOOSE COINS OF SIGNIFICANCE
It may sound funny but you would be surprised at how faddish rare coin investment can be if you don’t have the facts. Stay away from unproven trends and new certified coins with unproven records. Stick with the tried and true, remembering that what was rare and popular forty years ago will also make the grade forty years from now.
AND FINALLY MY TRADING SECRET
Building a real rare coin collection, something of value which will prove historically important and provide financial stability in addition to your bullion holdings requires patience. It also requires the ability to trade successfully especially if you have chosen a coin which does not fit into your developed plan or you have lost interest in an area or series.
If you have a bunch of “old stuff” with no investment design in place consider trading your way to investment success. Sometimes trading a poor rare coin choice for something with better potential makes sense and gets you on the right track.
The concept is to actively develop your certified rare coin position while moving toward improvement. I have traded my way into rare coins I would have never considered just ten years ago. And can honestly say that most significant rare coin collections involve active trading of material when an advantage presents itself.
In trading most dealers will pay more for your old stock and sell you their better inventory for less because they realize it is just good business to develop committed customers. It does not always make sense to trade but when an advantage presents itself this approach can be profitable and powerful at the same time.
The following list of PCGS graded rare coins are a good start for someone new to rare coin investments. These choices will move you past the mistakes made in buying graded modern issues and start you on the right path to understanding the real world of rare coin investment.
As time passes, your rare coin library and knowledge will increase. And the fascinating field of rare coin study will grow to include earlier coinage including pre-civil war, territorial gold examples, patterns, and colonials.
We recommend coins graded by PCGS (The Professional Coin Grading Service). America’s Number One Grading Standard. You can learn more about PCGS with the PCGS Grading Process Video.
Keep in mind that the PCGS certified rare coins listed are a selection from a larger inventory of “type” coins. They are chosen to highlight that “type” investing need not be expensive and there are many undervalued “type” coins which remain a part of the “golden age” of rare coins.
I also have long-term price graphs which show excellent entry points and good timing as well. For now however I would suggest you call me (1-800-225-7531) with additional questions about investing in the amazing world of rare coins by “type”.
This will give me an opportunity to provide straight-forward answers including a few curves in the road for even the best rare coin choices involve some risk. The call is free and the discussion will further explain why holding these coins have historically protected wealth especially during a currency or inflationary crisis. Then you decide.
California Numismatic Investments
P.S. I appreciate how busy everyone is these days so I have added my email (firstname.lastname@example.org) if you want questions answered in writing. If you prefer a call-back email your name and number and perhaps suggest a convenient time. There is no obligation and developing this important investment area is also fun and educational. Thanks for reading.