Investment Options: Understanding the Value, Rarity and Types of Coins
By Peter Kevorkian, United Coins and Precious Metals
Collecting coins isn’t just a hobby. In fact, for many people, coin collecting is a type of investment that can hedge against inflation and provide a wonderful store of value. When it comes to investing in coins, here are some of the main principles to keep in mind. Of course, one of the best ways to get started and learn more about adding coins to your portfolio is by visiting our store in person. United Coin and Precious Metals has been a trusted advisor in the coin collecting/investment community for many years, and continues to maintain a reputation of excellence among the La Jolla community. Log onto http://www.unitedcpm.com or call us at 1-858-412-6462 for more information about adding coins to your investment portfolio.
Numismatic/Investment Grade Rarities
Investment grade rarities within the numismatic community generally hold a number of the following characteristics. Higher numeric grade relative to their peers, in other words a mint state 1881-S Morgan Dollar grading MS67 would be considered investment grade whereas a lightly circulated example of the same date would not. Investment grade coins are generally graded by one of the two leading grading services, either PCGS (Professional Coin Grading Service) or NGC (Numismatic Guarantee Corporation). Investment grade coins generally fall under one of the more popularly collected U.S. series, such as Morgan Dollars, Saint-Gaudens $20 gold, Walking Liberty Half Dollars, etc… In other words the more abstract an item is the lower the appeal from an investment standpoint.
Semi-numismatic coins are very popular among collectors. Most of the value is a result of the gold or silver content within the coin. Most people think of semi-numismatic coins as pre 1933 US gold coins as well as Morgan and Peace silver dollars. The difference between investment grade and semi-numismatic is largely a matter of condition, the latter often being lightly circulated or low mint state grade. These types of coins allow for an investment in gold or silver at a nominal premium over their melt or intrinsic value. Currently the premium you pay for semi numismatic coins are at a historical low relative to their past. There’s also a reduced downside risk when investing at a period of low premiums, no threat of confiscation and no reporting requirements. Plus, these types of coins are enjoyable and fun to collect.
Collector coins would be considered coins of lower value also with limited intrinsic value as well. In other words modern proof and mint sets, coins pulled from circulation within the past 50 years, statehood quarters, modern commemoratives, etc., would be examples of collector coins. Collector coins are fun, inexpensive, educational and provide hours of enjoyment.
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