Did you know if you invested in rare coins in 1970, you could have made a 7135% return on your investment? There’s many tales in which rare coins purchased by savvy investors using only a few thousand dollars, realized hundreds of thousands and even millions of dollars at auction many years later! In addition, the variety of options are endless. Almost every country in the world has minted coins. You can collect ancient Greek coins or US coins, the choice is up to you. Within each country, coin designs have evolved and changed over the centuries. Some collectors like to collect a single series while others only collect one coin of every “type”.
There are 4 keys to investing in rare coins:
1. Coins minted for regular circulation before 1964 were actually minted with precious metals, which increases their base value.
2. Low mintage or “population” figures command higher premiums. A coin with a total mintage of 10,000 will generally be worth more than a coin with a mintage of 35,000,000. This is simply because of supply and demand.
3. The condition of the coin effects the value. Coins that look like they just came out of the mint command higher prices than worn or damaged coins.
4. After these, rarity comes into play. If you own a coin that is the only known surviving example, everything else is secondary. The condition will not be as important nor will the mintage. If a coin had a mintage of 5,000 but only one is left in the world, the coin will command a high price.
The best way to purchase rare coins is by making sure they’re certified by PCGS or NGC in grades MS-60 or higher. Coins are graded from 1-70 with 70 being a perfect grade. The reason I suggest 60 or higher is because you tend to have better returns with coins that are in great condition and more rare. Don’t pay a lot of money for an uncertified coin: a novice can easily mistake a counterfeit coin for a rarity or overlook major de-valuing flaws. Use your eye and judgment to look for the best looking coin in a grade as not all coins of the same grade are equal! When beginning your coin collection, looking for errors in your pocket change is a great place to start. You can make a hundred to a thousand dollars instantly if you know what to look for!
Jamie has an MBA from Rutgers University and a Professional Certificate in Real Estate Finance, Investment and Development from NYU. He’s traded stocks since he was 13 and bought his first property within a year of graduating college. He also flipped properties and got out before the 2008 mortgage meltdown because he was able to see the market turning before it happened. He’s started two companies and also has experience in investing in antiques, collectibles, gold, silver and trading futures. He currently operates a website dedicated to helping people acheive financial freedom. For help with money visit www.jamiesmoneyadvice.com.