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
These rare £2, 50p, 20p, 2p coins are worth hundreds - check your shrapnel now
It's time to look down the back of the sofa, search the pockets of your jeans and inspect the contents of your piggy bank, as you could have a small fortune of shrapnel sitting gathering dust. While everyone has been eagerly checking their new £5 notes to ... more info

Rarest and most valuable coins in circulation revealed – do you have one in your spare change?
Now we reveal the rarest and most valuable £1, £2 and 50p coins that could be found in your spare change. There are a number of rare coins that are currently in circulation. The old style £1 coin has been in circulation since 1983 with over 1.5billion ... more info

Rare coin collection going up for auction at Kimball Sterling, Inc.
Click to share on Twitter (Opens in new window) Click to share on Google+ (Opens in new window) Share on Facebook (Opens in new window) Click to share on Pinterest (Opens in new window) JOHNSON CITY, TN (WJHL) – Kimball Sterling, Inc., an auction company ... more info

Lord Kitchener WW1 £2 coin: Is it really worth hundreds of pounds and what are the rarest £2 coins?
In the last few months, This is Money has received a number of reader letters and e-mails asking whether or not their coin is rare. One of the most common is the Lord Kitchener World War I £2 coin, which was minted in 2014. Readers have contacted us in ... more info

337 Fresh Lots at David Lawrence Rare Coins Auction
Our Sunday Internet Auction #950 is now live with a great selection of 337 fresh, new coins, 65 No Reserve lots and 25 Vault Value items. All lots will begin closing at 8pm Eastern Standard Time on Sunday, March 5. more info

THIS is the most valuable coin in circulation — and it could make you a FORTUNE
Brits have been urged to spend their old £1 coins before the new 12-sided designs are introduced next month. And the hunt for the rare Jane Austen £5 continues, with one special fiver still out there to be found. A mystery woman gave her engraved fiver ... more info