7 lessons in collecting: Stretch budget for special coins
- Published: Dec 23, 2014, 5 AM
Editor's note: The following post is part of Coin World's "7 lessons in collecting" series. Find links to the other posts at the bottom of this page.
Investing in rare coins is not easy. It takes dedication to learn various aspects of coin collecting that are always changing: supply, demand, rarity, grading, and understanding how to maximize value when buying and selling. These are skills that take years, if not a lifetime, to master.
Thankfully plenty of helpful resources exist in the coin field to help collectors willing to put in the legwork to maximize the investment return on their collection, including a new book by Robert W. Shippee recently published by Whitman, titled Pleasure and Profit. In it, Shippee discusses his pursuit over the course of more than a decade to put together a type set of each major design type from copper half cents to gold $20 double eagles, from 1793 to the present day. It’s a frank, candid tome filled with anecdotes that collectors can learn from.
Lesson No. 6: Look for special coins and stretch for them
As he gained experience, Shippee learned to carefully view nearly all coins before bidding on or purchasing them. He did not rely on certified holders when buying, but tells of many instances in which such holders helped sell his coins for excellent prices when they crossed the auction block.
Upgrading is an expensive habit, so buy it right up front, and buy something that you will be excited owning. He writes, “Be sure to actually like the coins you buy” because you’ll enjoy owning them, sharing them, and if you happen to lose money, at least you’ll have had the pleasure of spending time with an interesting, handsome object that brought you pleasure.
Shippee says: “When you see a coin in person that shouts, ‘Buy me!’ you should take that advice very seriously. It’s exceedingly unlikely you’ll regret these types of purchases.”
It’s also important to be aware of the prices being achieved for coins in the current market. Take the collection of John Jay Pittman, which was sold at auction in the late 1990s. Pittman spent around $100,000 to build his collection.
Shippee, in contrast, paid $54,625 at a Stack’s auction for a Very Fine 35 1808 Capped Bust gold $2.50 quarter eagle the firm described as “one that will be within reach of many interested collectors,” and he resold it a little over a year later for $63,250. On the expense of this affordable coin, Shippee remarked, “I spent more than half of Pittman’s lifetime coin budget to buy this single coin, and someone else paid 16% more 14 months later to become its new owner. How times have changed.”
Alternately, while collecting common coins in average grades may be educational and satisfying, the financial rewards are most likely to be modest.
More from the "7 lessons in collecting" series:
- Lesson No. 1: Invest in education first
- Lesson No. 2: Understand that mistakes happen
- Lesson No. 3: Learn how to grade coins
- Lessong No. 4: Quality and rarity don't go out of style
- Lesson No. 5: Understand supply and demand to find value
- Lesson No. 6: Look for special coins and stretch for them
- Lesson No. 7: Understand how to work with dealers
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