I’ve been to quite a few major and minor coin shows since spending a week in Philadelphia for the ANA’s World’s Fair of Money last August which include – the Baltimore Expo, Money Show of the Southwest in Houston, Florida United Numismatists (F.U.N.) Show in Orlando and now I’m at the Long Beach Expo in California. As I look back, I’ve been active in the coin market for more than 40 years, since I was a teenager, and I’ve been through several boom and bust cycles in this market.
There was the roll boom and the Silver Certificate run during the 1960s; the inflationary spiral of the 1970s, in which both rare coins and precious metals prices soared; a short bull market in rare coins during the mid to late 1980s; and then the roaring 2000s, when everything soared from stocks to real estate to rare coins and gold. Then everything took a hit during the Great Recession that began during the 2007 to 2008 period. Some coin prices suffered during that time but, at least on the high end of the grading and scarcity scale, they’ve come back nicely.
People with capital to invest have been turning to the rare coin market as an alternative to diversify their investments from traditional vehicles such as stocks and real estate. And most of them are having some fun with coins while doing so. Rare coins are being viewed as solid long-term investments by those investors who take an interest in them and who spend some time to learn about rare coins and their market. If you’re not willing to commit yourself in this way, it’s better to stay out of the coin market. Mistakes are made by those who don’t do their homework.
Because of growing interest and demand, the coin market is seeing the classic signs building up to a long-term bull market cycle. Coin shows are busy with buyers who are serious about investing money in this market and they’re taking action. These are not just experienced “life-style” collectors. These buyers include investors who are building collections that may take years to assemble, foreign buyers coming into the U.S. market, and dealers who are representing major buyers or who are buying for their own inventories to replenish what they’ve sold. Some of the dealer buying is also putting profits to use that have been earned through serving the public in buying and selling bullion related products.
Another sign of a bull market shaping up, which has been going on for at least a couple years now, is that the supply of premium-quality coins is drying up. In other words, what’s being bought up is being held off the market by strong hands that are in it for the long-term. CAC and the PCGS and NGC Plus grading designations have fueled this aspect of the coin market. Asking prices for some of these coins have been rising, but prices rises are somewhat hidden because the price guides available to the public primarily report prices for average quality coins.
My advice is to use at least a five to ten year time span within which to build your rare coin collection/investment, and develop a plan. I also suggest teaming up with a competent, experienced dealer in the field who does business nationally. The advice provided will undoubtedly pay off over the long haul, and having someone who’ll look out for your interests will be worth your loyalty and will probably save you money over the years.
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