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Most undervalued coins


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#1 Guest_Jimmy_I'm_a_Guest

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Posted 16 February 2010 - 01:24 PM

Lets treat coins as an investment. If you had to invest what would your choice be? Which coins or range of coins do you feel are currently undervalued? Or would you simply go for gold?

James

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#2 £400 for a Penny ?

£400 for a Penny ?

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Posted 16 February 2010 - 01:41 PM

There are a million and one different ways to answer that question.

What budget/spend are we talking about ? £100 a year, £1,000, £10,000 ?
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#3 Guest_Jimmy_I'm_a_Guest

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Posted 16 February 2010 - 01:51 PM

There are a million and one different ways to answer that question.

What budget/spend are we talking about ? £100 a year, £1,000, £10,000 ?


Hypothetical question. I just have a theory that some coins are currently underpriced considering availability and desirability but desirability is not really objective is it? I was thinking wreath crowns are quite a good buy considering such a small circulation.

Lets go for £10,000, where would you put it? We could have a league and see what goes up the most in a year.

James

#4 Coppers

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Posted 16 February 2010 - 02:07 PM

I'd put your money in the bank. I suspect that most who view the hobby purely as an investment end up on the losing end.

Edited by Coppers, 16 February 2010 - 02:07 PM.


#5 Rob

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Posted 16 February 2010 - 02:41 PM

Lets treat coins as an investment. If you had to invest what would your choice be? Which coins or range of coins do you feel are currently undervalued? Or would you simply go for gold?

James

Silly idea. If you knew the answer to the question, you wouldn't be asking. Don't even try to second guess the market without a very deep knowledge of what you are "investing" in. On any day, all coins can be either cheap or expensive relative to market, but that requires you know what the market is and one swallow doesn't make a summer. Simply going for gold is even more of a risk, because bullion is a single commodity at the end of a very solid bull run whereas coins can effectively be many commodities depending on the field involved. However, as all prices have risen in line with the general market - in fact they are the general market, it would take a crystal ball to identify the next area to outperform the mean. I don't have one of these.

#6 Peter

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Posted 16 February 2010 - 02:49 PM

Hi James
There are several dates in early copper which are far rarer than catalogues indicate (and a few overvalued dates too)
Quality is always better at holding its value so concentrate on buying the best.
For investment buy well rounded,centred, quality silver hammered coins.They seem to be popular and always sell for a premium over
book price whether on dealers lists,ebay,coin fairs or auction.
Gold....can you guess where it is going next....history has shown it to peak and trough....where are we now?

#7 Rob

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Posted 16 February 2010 - 04:09 PM

Hypothetical question. I just have a theory that some coins are currently underpriced considering availability and desirability but desirability is not really objective is it? I was thinking wreath crowns are quite a good buy considering such a small circulation.

Desirability isn't objective, but it plays a huge part in pricing.

Consider your wreath crown. Struck for currency between 1928 & 1936 with 9034 struck in the first year and a low point of 932 for 1934. Prices for UNC are between £500 & £5000 and availability is clearly not an issue because most sales will have at least one example. Now consider the following list:

1675/3/2 halfpenny
1694 1/2d with GV/B on the obverse.
1694 1/2d struck in brass (2 known, 1 available to collectors)
1788 1/2d type R24 in aluminium
1790 1/2d type R44 in silver
P1231 obverse uniface in copper (1 available to collectors)
1807/6 restrike trial halfpenny
2x P564 1689 farthings struck on a Charles II halfpenny
Charles I 2/6d im.Eye struck on a shilling flan
Charles I 2/6d Worcester mint Allen dies D-23
13 varieties of Weyl patterns.

This list is not exhaustive, but all of the above 23 coins are mine and other than where indicated are unique (or effectively so) to my knowledge. But - not more than 1 or 2 of them have a cat in hells chance of selling for more than the price of an uncirculated 1934 crown. Why? It all comes down to the number of collectors relative to the coins available in the market place. There are probably more than 932 collectors worldwide looking to acquire a mint state 1934 wreath crown despite not all being in that grade, but far fewer interested in a Weyl pattern for example. Collecting habits change too. One year it might be pennies, the next year it might be crowns. Currently you can't get good hammered gold for love nor money and as a result prices have exploded, but I wouldn't like to prophesy that this will be the situation next year. Desirability overrides the rarity factor time after time.

The basic rule should be to collect what you like and invest in what you can comfortably predict. Coins are essentially a discretionary purchase made from surplus funds unlike commodities which are subject to the demands of commerce and so the latter are likely to produce more predictable and better investment results if you do your homework.

Sure the investment tail has wagged the collecting dog as witnessed by last month's Heritage sale where an MS65 slabbed 1901 1d sold for about £600, but taken in isolation you could come a cropper big time if you paid too much attention to this isolated instance.

Edited by Rob, 16 February 2010 - 04:17 PM.


#8 £400 for a Penny ?

£400 for a Penny ?

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Posted 16 February 2010 - 04:31 PM

Hypothetical question. I just have a theory that some coins are currently underpriced considering availability and desirability but desirability is not really objective is it? I was thinking wreath crowns are quite a good buy considering such a small circulation.

Lets go for £10,000, where would you put it? We could have a league and see what goes up the most in a year.

James


Difficult James, very difficult, but if you put a gun to my head, I'd say high end copper and bronze - there seems to be a lot of interest.

But only the very very best and it can take a bit of patience waiting for them to show. I haven't bought anything for 6 months +

That has been the hardest thing for me to learn in the hobby, focus and patience. I've made many costly mistakes along the way, what's that quote; "Experience is a marvellous teacher, but she sends such terrific bills"

Now, when I buy a coin, I write the moeny off and forget about it. If, somewhere down the line, I, or maybe one of my sons has a pleasant surprise, well, happy days.

Keep going though, if you want a wreath crown, go for it, why not ?
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#9 Sylvester

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Posted 16 February 2010 - 06:06 PM

Talking of undervalued, i've always pondered about acquiring some Edward VI gold, the thing is i've never actually encountered any for sale. Me thinks it's rarer than catalogues might suggest.
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#10 Rob

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Posted 16 February 2010 - 06:20 PM

Talking of undervalued, i've always pondered about acquiring some Edward VI gold, the thing is i've never actually encountered any for sale. Me thinks it's rarer than catalogues might suggest.

They turn up on a reasonably regular basis. e.g. The last 3 St. James's sales had 2,4 & 4 pieces respectively. I didn't check the other houses, but it is reasonable to assume these were not the only pieces available in the past 15 months.

#11 Guest_Jimmy_I'm_a_Guest

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Posted 16 February 2010 - 07:18 PM

Don't get me wrong, I buy coins for pleasure when I can afford them and don't have thousands to invest. But these days everything can be a commodity and pension funds buy works of art so somebody somewhere must be looking at coins as a hedge bet surely?

#12 £400 for a Penny ?

£400 for a Penny ?

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Posted 16 February 2010 - 07:52 PM

Don't get me wrong, I buy coins for pleasure when I can afford them and don't have thousands to invest. But these days everything can be a commodity and pension funds buy works of art so somebody somewhere must be looking at coins as a hedge bet surely?


No, doesn't work like that.

When pension simplification was introduced several years ago, everyone got very excited because it looked like all bets were going to be off with permitted investments, including residential property. Once evryone sobered up, they realised that you can't regulate 'emotional' investments so they pulled back from allowing it.

I worked in that area for a while and there's a tale to tell. Supposedly, somebody wanted to put a dinosaur museum into his pension fund. The ruling was, that the buildings could go in, but the dinosaurs couldn't because they were portable. This ties in somehow (no idea) with the portable antiquities scheme, but the issuing point is that if you can move it, you can't put it in your pension fund.

So no coins.

If you're running a pension fund, you have to be able to account for a value and liquidate the assets within very quickly. How can you do that with coins ?

You can't have art either, although once upon a time you could, 25 years ago before they woke up to what was going on - yachts too. I think I'm right in saying that HMRC have to be notified of every yacht purchase - it's what all the best crims buy first...

Maybe after a Bentley :ph34r:
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#13 Sylvester

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Posted 17 February 2010 - 01:09 PM


Talking of undervalued, i've always pondered about acquiring some Edward VI gold, the thing is i've never actually encountered any for sale. Me thinks it's rarer than catalogues might suggest.

They turn up on a reasonably regular basis. e.g. The last 3 St. James's sales had 2,4 & 4 pieces respectively. I didn't check the other houses, but it is reasonable to assume these were not the only pieces available in the past 15 months.



I will admit I wasn't thinking auctions. I've just never seen dealers selling them ((shops, internet, coinlists or otherwise). They may well have been some at the York fair but I didn't come across any.
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#14 Rob

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Posted 17 February 2010 - 04:56 PM

I will admit I wasn't thinking auctions. I've just never seen dealers selling them ((shops, internet, coinlists or otherwise). They may well have been some at the York fair but I didn't come across any.

I didn't see any at York either, but wasn't looking for them. I suspect it is too high a ticket price for a half decent example for many dealers to stock, and if in dire condition they are equally difficult to shift.