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Weaver

Strategy & etiquette for purchasing coins

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Morning everyone,

So last night I was dwelling upon the various strategies collectors employ in order to purchase their coins, and I thought I would ask you all the whys & wherefores of coin buying strategy and protocol.

In other words - How do you buy your coins?

I looked at the choice GV Shilling advertised here and was very impressed with the quality, but the asking price was higher than many other similar coins I have seen for sale on other coin sites and shops.

My first question is then, if you were interested in acquiring the Shilling is it good investment strategy to pay a little over the odds for a choice coin? Is it likely to return a profit in the long term (say 20 years) ??

Finally, is it acceptable to haggle with coin dealers over asking price?

Hope this doesn't touch any nerves at all, I'm just trying to understand the coin dealing business a little better in terms of the best cost effective strategy for building up a first class coin collection for the future.

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No coin dealer would react badly if you were to write and make an offer on something, that's usually the way things are sold in a live environment, so I don't see why it should be different online. A lot of my coins sell quite quickly, but for those that have been sitting for a while I'd gladly accept a reasonable offer.

Which one do you mean?

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To echo Chris if you don't ask you don't get but always remember these guys are dealers to make a living so are well with in their rights to ask whatever they want for a coin, it owes them the purchase price, the cost for their time to find it, store it and if they are selling it online or at a fair the costs to actually 'show' you the coin.

From what I have seen most dealers are not offended by you asking about the best price they can do on a certain coin etc as long as you dont offer them £10 for a coin up at £300! As for an investment there are a few discussions on here about that. There are no guarantees that you will get  your money back and the flavour of the month tends to shift over time so while Shillings may be what people want now they may not be in 20 years and ultimately supply and demand will drive the price along with the grade. Higher grade coins seem to at least hold a majority of their value, if not go up, but again their are no guarantees.

I am collecting because it is something I have started to really enjoy, I like hunting for bargains at the fairs and on ebay etc. Of course there is a long term financial consideration unless you have bottomless pockets. I hope to either leave my kids a nice collection that they can either sell or keep adding too or sell it myself when I am at the stage of not being able to enjoy them myself. Fingers crossed, its worth more than I paid for it but this isn't driving my interest in the hobby and if it isn't worth more when I sell it then so be it I have enjoyed the hunting and collecting along the way :)

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20 minutes ago, Chris Perkins said:

No coin dealer would react badly if you were to write and make an offer on something, that's usually the way things are sold in a live environment, so I don't see why it should be different online. A lot of my coins sell quite quickly, but for those that have been sitting for a while I'd gladly accept a reasonable offer.

Which one do you mean?

It was the SHILLING 1918 CH.UNC-ABU at £70.

But I'm not rushing into purchasing just yet Chris! I'm still engaged in research and finding out as much as I can about investment strategy before I commit.

To explain better - I want to have two strategies going forward.

1. A coin collection that I can touch and feel and smile about.

2. A coin collection for pure future investment.

I'm thinking the Shilling in question would fit into option 2 because it's a choice coin right? Another member here repeatedly says buy the highest grade of a coin as possible, so I'm guessing that this coin in question is very high grade and therefore will return an investment in 20 years if purchased at an agreeable price!

Am I right?

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21 minutes ago, Nonmortuus said:

To echo Chris if you don't ask you don't get but always remember these guys are dealers to make a living so are well with in their rights to ask whatever they want for a coin, it owes them the purchase price, the cost for their time to find it, store it and if they are selling it online or at a fair the costs to actually 'show' you the coin.

From what I have seen most dealers are not offended by you asking about the best price they can do on a certain coin etc as long as you dont offer them £10 for a coin up at £300! As for an investment there are a few discussions on here about that. There are no guarantees that you will get  your money back and the flavour of the month tends to shift over time so while Shillings may be what people want now they may not be in 20 years and ultimately supply and demand will drive the price along with the grade. Higher grade coins seem to at least hold a majority of their value, if not go up, but again their are no guarantees.

I am collecting because it is something I have started to really enjoy, I like hunting for bargains at the fairs and on ebay etc. Of course there is a long term financial consideration unless you have bottomless pockets. I hope to either leave my kids a nice collection that they can either sell or keep adding too or sell it myself when I am at the stage of not being able to enjoy them myself. Fingers crossed, its worth more than I paid for it but this isn't driving my interest in the hobby and if it isn't worth more when I sell it then so be it I have enjoyed the hunting and collecting along the way :)

Thanks for your input Non!

I have two strategies really.

1. Keep enjoyng my circulated collection of Swedish Ore coins inherited from my Grandfather.

2. Build a 20 year investment portfolio of GB coins.

Also, thank you for the further info about the coin dealing business, because as a newbie I am curious about how it works y'know? All I know about this type of business is watching Salvage Hunters and Lovejoy, so the maxim seems to be buy it low and sell it high?

Can any coin dealers chip in please? I have a question for you...

Do you find that customers tend to stick with you? Why is that? 

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I can only speak from personal limited experience but there are three dealers I always make sure I check at the coin fairs, Rob, Colin Cooke and Ian. Most of my purchases at fairs have been off them. As for online dealers there are a few I keep an eye on mainly because their grading estimates are normally decent and I know that I can do a deal with them in bulk or they will run auctions with no reserves. So, yes, I suppose I tend to stick with dealers, but I am always looking for stuff from other sources. I am pretty sure most people here will have one or two dealers they use on a regular basis but will also be looking elsewhere :)

Edited by Nonmortuus
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Once again, thanks for your advice Non! Really helpful mate!

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Ok...

So would you purchase a choice coin in high grade for over the 'book' price?

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Book prices are purely a guide, hammer prices at auction are probably a more accurate guide but ultimately its what you think its worth. If you REALLY like a coin then get it because you may not have that opportunity again. A lot of my stuff is not top top end grade but they are also not washers. I probably only have a few 'choice' examples but I have purchased dates I am missing in grades I can live with with the aim to upgrade them over time. Ideally I would love every purchase to be a keeper but sometimes its not possible and the desire to acquire new stuff out weighs my ability to hold off and save :unsure:

I am really am new to all this so don't take my advice onboard without listening to the more seasoned collectors on here :)

Edited by Nonmortuus

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I would think if one is looking at coins as a long term investment then that person would need a combination of many things; knowledge of the subject, the money to make considered purchases and then be able to have that money tied up in something long enough to see the returns, and a large pinch of luck being in the right place at the right time to buy the right coins. If that person has all of that and possibly other traits I am not aware of then they should go for it.

Personally I do not see coin collecting as a money making investment for the future, a £70 coin will probably not be worth huge amounts even after 20 years. However I do believe there is the potential to make short term profits by looking at the trends and buying at the right price along with a bit of luck.

Just my opinion, and please do not take it in any other way. Keep enjoying the hobby 

Edited by IanB

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Totally with you IanB, and to be clear it's definitely a hobby first that I enjoy!

But, there is also a part of me that wants to consider a separate coin collection as a diverse investment strategy, and I'm sure there are many coin dealer's customers who ask their trusted dealer to create an investment portfolio of coins for them right?

Is that right? Or am I wrong here?

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Find a couple of dealers you trust and who are happy to spend time helping you is .......... good advice as already mentioned.

Just as there is one dealer i would never buy anything from again ,an experience i learned a lot from :rolleyes:

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Thanks PWA, and the obvious question is...

What tests or ways can you use to ensure you find a dealer you can trust?

Or is it sadly trial and error?

Sorry if you have talked about this before PWA, but do you mind telling me more about your negative experience with the dealer you now avoid please?

Edited by Weaver

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45 minutes ago, Nonmortuus said:

Book prices are purely a guide, hammer prices at auction are probably a more accurate guide but ultimately its what you think its worth. If you REALLY like a coin then get it because you may not have that opportunity again. A lot of my stuff is not top top end grade but they are also not washers. I probably only have a few 'choice' examples but I have purchased dates I am missing in grades I can live with with the aim to upgrade them over time. Ideally I would love every purchase to be a keeper but sometimes its not possible and the desire to acquire new stuff out weighs my ability to hold off and save :unsure:

I am really am new to all this so don't take my advice onboard without listening to the more seasoned collectors on here :)

What do you collect Non?

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Without hopefully boring you :D

I phoned a dealer up and explained i wanted to buy a few coins to put away for my grandaughter.

I had spent a few months reading and decided i was going to buy some pennies to put away for 18/21 years.

Explaining my requirements and asking for help i then bought a few .

I was told they were nice and high grades and had know reason to doubt him and spent £1,000.00 Approx.

Before going any further and having nobody else to check them decided to send them to cgs to be graded really for my own peace of mind.

The six coins came back rejected and two in much lower grades :o

When i phoned the dealer i just got excuses (they dont have a clue e.t.c.) i told him two were cleaned and was told i must of done it.

Taught me to learn a lot more and not to trust this seller again...........i wont and have spent thousands over the last three years a customer he lost.

Neil paisley at Colin Cooke has looked after me well ever since so i am happy to keep buying from him and a couple of others.

I dont want the coins for nothing (although would be nice) just at a fair price and as described :)

Be lucky and take your time.

Pete.

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16 minutes ago, Weaver said:

What do you collect Non?

Slowly but surely a bit of everything but mainly George V Halfcrowns at the moment. One of the other forum members on here, @Paulus, kindly allowed me to copy much of his web sites lay out (http://pwcoins.wordpress.com/) for my own web site. I dont have anything pre George II on there but feel free to take a look at http://noncoins.wordpress.com

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11 minutes ago, PWA 1967 said:

Without hopefully boring you :D

I phoned a dealer up and explained i wanted to buy a few coins to put away for my grandaughter.

I had spent a few months reading and decided i was going to buy some pennies to put away for 18/21 years.

Explaining my requirements and asking for help i then bought a few .

I was told they were nice and high grades and had know reason to doubt him and spent £1,000.00 Approx.

Before going any further and having nobody else to check them decided to send them to cgs to be graded really for my own peace of mind.

The six coins came back rejected and two in much lower grades :o

When i phoned the dealer i just got excuses (they dont have a clue e.t.c.) i told him two were cleaned and was told i must of done it.

Taught me to learn a lot more and not to trust this seller again...........i wont and have spent thousands over the last three years a customer he lost.

Neil paisley at Colin Cooke has looked after me well ever since so i am happy to keep buying from him and a couple of others.

I dont want the coins for nothing (although would be nice) just at a fair price and as described :)

Be lucky and take your time.

Pete.

That's a great story Pete, and exactly the kind of 'Buyer Beware' experiential tale I want to hear!

You see I really don't want to get ripped off right? And because I am by nature a very trusting person I can see myself as being cannon fodder for many an unscrupulous dealer.

But I'm totally with you on the area of a dealer missing out on revenue! You see, I'm willing to invest about £10K with a trusted dealer who can genuinely supply me with a selection of GB coins in the highest possible grade that 'will hopefully' realize a profit in 20 years time.

Perhaps I should give Neil Paisley a call?

Thanks Pete!

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2 minutes ago, Nonmortuus said:

Slowly but surely a bit of everything but mainly George V Halfcrowns at the moment. One of the other forum members on here, @Paulus, kindly allowed me to copy much of his web sites lay out (http://pwcoins.wordpress.com/) for my own web site. I dont have anything pre George II on there but feel free to take a look at http://noncoins.wordpress.com

Thanks Non.

Other than the inherited collection of Swedish Ore coins from my Grandfather, I have to admit I have got possibly over 2000 world coins :o

Yeah I know...typical newbie hoarder!:P

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Give Neil a ring by all means as he is an honest guy although there are numerous others ,maybe visit a show.

The idea of making profits though i think should be forgotten about as there is know gaurantee at all .

 

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Thanks Pete, and I totally understand the profiteering angle, but even a high grade GB collection that I can be proud of owning that at least will hold it's value in 20 years time would satisfy me.

Thanks for everyone's input so far!

This is becoming a very interesting thread.:)

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So everyone...here's another interesting question...

If you had £10K to invest purely in coins (or coin:o)...

What would you buy and why?

Oh...and how would you buy it?...

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1 minute ago, Weaver said:

So everyone...here's another interesting question...

If you had £10K to invest purely in coins (or coin:o)...

What would you buy and why?

Oh...and how would you buy it?...

Greetings Weaver.

If I had 10k to invest I'd probably buy gold - sovereigns etc. Can't see them ever losing much value (not that I know about such things).

If I had 10k to spend on coins I'd have a full set of wreath crowns which I'd probably buy at auction as there are lots of fakes out there and I don't trust ebay. I use it, but I don't trust it. :P Why? Because I like them. :D

With luck I might have enough change left over for a 1905 half crown. 

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3 hours ago, Weaver said:

Finally, is it acceptable to haggle with coin dealers over asking price?

Anything worth having is worth haggling over, in my opinion. The worst that can happen is they say no. ;)

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7 minutes ago, mrbadexample said:

Anything worth having is worth haggling over, in my opinion. The worst that can happen is they say no. ;)

Seconded. If you don't ask, you don't get! Most dealers will negotiate with you, it's all part of the fun ;) 

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13 minutes ago, mrbadexample said:

Greetings Weaver.

If I had 10k to invest I'd probably buy gold - sovereigns etc. Can't see them ever losing much value (not that I know about such things).

If I had 10k to spend on coins I'd have a full set of wreath crowns which I'd probably buy at auction as there are lots of fakes out there and I don't trust ebay. I use it, but I don't trust it. :P Why? Because I like them. :D

With luck I might have enough change left over for a 1905 half crown. 

Love it:D

I'm glad I started this thread now...learning loads already!

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