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Strategies for Investing In Coin Collections

By Gainesville Coins
Published December 07, 2009

In recent years, many investors have turned to coins as a precious metals investment opportunity. Unlike many traditional investment options, precious metals tend to remain relatively stable over time, promising predictably steady returns. As in any other investment market, the coin market offers its own set of standards. Coin investors who use these standards to guide their purchases will enjoy greater investment growth over time.

Most importantly, to invest in coins effectively, one must understand that each coin has a value, as does the collection as a whole. Thus, the wise investor will build a collection that actually enhances the value of its individual pieces. When carefully assembled, a coin collection can truly worth more than the sum of its parts.

  1. Be patient. Rather than buying the first available coin that may fit a collection, it is best to wait for high quality coins that will be an integral part of a cohesive collection. After choosing a specific focus for the coin collection, many savvy investors will make a list of coins that fit that focus, and they only buy items from that list.
  2. Buy the best quality coins possible. As with many investments,quality trumps quantity. The return on a few outstanding coins is often higher than the appreciation on several mediocre ones. Furthermore, collectors will find that it is often easier to resell coins of outstanding quality.
  3. Stick with a reliable coin dealer. Working with a reputable dealer means that investors can be confident in the quality and value of their purchases. Additionally, developing a relationship with a dealer can have special benefits: the dealer is more likely to give competitive prices and keep a loyal customer apprised of new acquisitions that may fit the customer’s collection.
  4. Realize that investing in coins is not about finding a “bargain.” Rarely will reputable dealers offer bargain-basement prices on truly valuable coins. The wisest coin investors are willing to pay fair prices for their acquisitions, because they understand that the upfront cost will be balanced by increased appreciation over time.
  5. Get educated about coin pricing. Many novice coin buyers do not realize that the Bluesheet price of a coin is actually based on wholesale bids on coins of unknown quality. Thus, coins in superior condition will naturally be priced above the Bluesheet prices.
  6. Think outside the box. While most precious metals investors may concentrate on gold and silver bullion products, palladium and platinum offer new investment opportunities.
  7. Be consistent. Beyond merely choosing a theme for the collection, selecting coins with a close and obvious relationship to one another is important. Collectors should also be consistent with coin quality.

The impact of wise product selection is just as great in the precious metals market as in other investment domains. An investor who works to build a cohesive and unified collection will improve the holistic value of his coin collection.

This information is provided for general reference purposes and does not constitute professional advice. For detailed coin collecting or investing information, please consult with a numismatic or financial professional.

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