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Michael Bugeja

Online Coin Auctions

Michael Bugeja

Michael Bugeja, a coin collector since childhood, is a professor at Iowa State University and also a former member of the Citizens Coinage Advisory Committee. He is a nationally known author, journalist and educator.

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Archive for 'August 2016'

    Rising Buyer Premiums on Proxibid

    August 28, 2016 12:47 PM by Michael Bugeja
    Proxibid coin auctions are a mainstay of my hobbyist experience. I have been able to get bargains there that I could never secure on rival portals, such as eBay. But the trend with some of my favorite auctioneers has been to continue raising fees on Internet buyers, and I believe we may have reached the tipping point in some auctions charging 23%--almost a quarter of the hammer price.

    Conversely, some sellers are able to keep rates as low as 8%.

    I understand the reasons for higher fees. Auctioneers have to pay credit card companies, Auction Payment Network (for secure transactions) and Proxibid hosting fees. Those fees alone justify an 8-10% premium. Then there are photography costs from equipment to freelance photographers. So add another 2% there. So if the house charges 15% buyer premiums, it is looking at 3-5% profit.

    Moreover, some of these estate auctioneers are doing simultaneous onsite sessions requiring rent space or other physical preparations and staff.

    Onsite sessions usually have lower buyer premiums, or none at all, which has always bothered me because all venues--online and onsite--come with expenses.

    One auctioneer charging 23%, the highest BP in the coin category on Proxibid, says the higher fees are needed to offset losses. "I lose 2%, on every transaction at that," he states, noting Proxibid fees went from 5 % to 6%. "I am trying to keep  my head above water. It boils down to overhead. It costs me just as much for advertising for small a auction as it does for a large auction."

    This auctioneer does charge onsite buyers a 10% fee for winning bids.

    Another auctioneer has limited buyer premiums to 8%. "We do not use the buyer's premium as a revenue stream," he says. "We use it to pay fees - credit card processing, Internet fees and shipping. The 8% covers that, in most cases."

    This auctioneer doesn't have simultaneous onsite sessions, using Proxibid for Internet only ones.

    The damage of any buyer premium over 18% concerns return customers. I bid low or not at all when the fee rises to 20%. And others who do not pay attention to higher fees, bidding as usual, then have to pay credit cards and lose a higher share of their hobbyist money.

    Chances are they won't be back.

    What's worse is that raw coins sold on Proxibid auctions are risky at best. Even with my numismatic acumen, I lose out on my lower bids more than half the time. Thankfully, every month I am able to score a big bargain so that keeps me bidding.

    If you sell on Proxibid, think about a tier system that starts at 20% for purchases of $100 or less; 17.5% for $100-500; and 15% for anything over $500. You can run specials for gold. The more buyers bid, the more money you make.

    Keep in mind these auctioneers also may charge consignors, so buyer fees are not the only revenue stream here.

    I still patronize with dozens of bids my favorite sellers who still charge 15%. I encourage you to look for them on Proxibid and see if they are featuring any coins you like.

    In any event, think about the problem with a 23% fee if a bidder wants to score a one once gold bullion with gold at $1,350 an ounce.  The bid would have to be $1,100 to reach the retail price. The net result of that would be the consignor not only loses $250 at retail but also more than $300.

    Now the consignor will not be a repeat client.

    Better for consignors and buyers to sell or purchase the gold at wholesalers online for a $1,390 fee.

    And that phenomenon should not only trouble auctioneers but Proxibid, too. If you keep raising fees, you'll end up with a domino effect and fewer auctions because, well, there are fewer buyers on the portal.

    Bidding on Ancients in Online Estate Auctions

    August 20, 2016 8:29 PM by Michael Bugeja

    In a recent online estate auction, I was fortunate to snare several ancient coins at good discount, primarily because the audience was less knowledgeable about the worth of some of these treasures.

    I won 12 ancients, including a Corinth stater and a rare Marc Antony and Octavia Cistophoric tetradrachm. (Later in his life Antony would divorce Octavia and pursue the famed Egyptian queen Cleopatra.)

    Both of these coins were extra fine and rare. I paid about $500 for the two, but on the market, they sell for hundreds more.

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    These and other coins were sent to NGC for authentication, which is essential whenever you purchase raw coins online. 

    Here's an example of an NGC-slabbed Corinth stater selling for close to $3,000. Never pay that amount for an uncertified coin as there are counterfeits of ancients, too.

    Corinth is known for two things in modern society. The Apostle Paul made missions to the city and Pegasus metamorphosed from mythical beast to Western Civilization icon, usually associated with poetry.

    The winged stallion is one of the most recognizable figures from ancient myth.

    The stater that I won with a bid of $250 (or $295 with buyer's premium) also features the goddess of wisdom, Athena, on the reverse.

    Some hobbyists collect Corinth staters not only for their beauty but also for the different images of Pegasus and Athena. You can find dozens of them on this page of the ancient coin database wildwinds.com. 

    Watch for an expanded Home Hobbyist column in Coin World when NGC returns my ancients. 

    Let Holdering Companies Know Certification Issues

    August 14, 2016 6:34 PM by Michael Bugeja
    ​In an online auction on Proxibid, this rare coin was being offered, an 1875-CC $10 Liberty Gold Eagle, with a slim mintage of 7,715 pieces, making the coin desirable, even in low mint state. In fact, this coin is ultra rare in higher grades. For instance, this PCGS example at XF40 sold for more than $7050 in a Heritage Auction. 

    As a rule, I never look at price guides but utilize NGC and PCGS certification websites to make sure the coin is authentic. The sites also provide the latest auction prices.

    More than once I have checked certs only to find that a counterfeit was being offered in an estate auction because the holdering company photo differed from the auction one on the web. Here's an example

    As you can see from the photo above, the NGC database grade for the 1875-CC was deleted for some reason, and that had me worried. First off, the 1875-CC Gold Eagle is often counterfeited. The strike is typically soft, as this was; but at VG10, it was difficult to spot any characteristics to help me verify its authenticity. 

    I have found NGC to be particularly resourceful and helpful when issues arise in its online database.

    "We work really hard on maintaining the integrity of our certification database," says Scott Schechter, vice president. "We encourage collectors to verify certifications and notify us of anomalies. In cases where problems have been identified, such as counterfeits, a note to contact customer service will appear in lieu of grade when said coin is verified. That is a red flag."

    That wasn't the case with this coin. " Errant deletions and other data error can occur for a variety of reasons," Schechter stated. He consulted his database records, as every change is recorded, and was able to restore the certification

    "Checking certifications is good advice," he added. "We will always review a coin free of charge in our holder when a data error appears."

    On the bottom of every NGC coin certification, this notice appears: "If the information displayed above is incorrect or does not match the coin you are verifying, or if you believe that you have a counterfeit or tampered NGC holder, please contact ConsumerAwareness@ngccoin.com."

    This service is essential as is checking certifications of any lot online that you wish to bid on or purchase.

    Don't Overlook "Missing Halves" Mint Sets

    August 11, 2016 11:10 AM by Michael Bugeja

    ​Many hobbyists collect double mint sets, which the US Mint produced between 1947-58. The coins were housed in cardboard folders often with green flimsy paper glued to one side. The cardboard and paper often cause the coins inside to tone.

    I will save a full-blown column on these low-mintage sets for another day. Today we're looking at the remnants of sets with missing halves, which tend to tone in marvelous rainbows and which often are removed from sets and sent in for grading. Here's an example of the type of toning you can find on occasion, commanding premium prices when graded by a top-tier holdering company. (Bottom-tier slabs often house artificially colored coins.)

    But this doesn't mean that the other coins in the double mint set are not worth considering. First of all, you will have four or six silver quarters and silver dimes, depending on the year. That's about $20-30 of silver right there.

    But there is a big market for toned quarters, too, which sell particularly well on eBay.  Here's a 1958-D quarter of registry-set quality being offered for a whopping $12,508!

    There is somewhat of a market for the dimes and a better one for toned cents. But the real money to be made is in the nickel, and not because of toning. Nickels produced in the 1950s that have full steps can bring hundreds of dollars. For instance, a 1958 nickel with full steps is valued at $1,200 in a PCGS holder!

    The steps are on the reverse of the coin. Use a magnifier and see if you can see 5 or 6 steps. I have sent a few in for grading this month and will report on the outcome later.