How to Develop a Plan for Investing in Rare Coins

Investing in rare coins has always been a financially rewarding pastime, but in an era of economic uncertainty, more and more people are turning to rare coin investments to provide them with the appreciation and stabile returns they need. Due to the limited supply of rare coins, their value appreciates when the rare coin market is flooded with new money vying for a slice of the pie. Conversely, they decline in value when money is taken out of the rare coin market via a selling trend. Recognized as an asset that stores value, rare coins typically perform extraordinarily well during inflationary periods. With inflation on the rise, rare coins are slated to continue their strong market performance in the coming years, providing investors with a pleasurable and lucrative experience.

Determine the Purpose of Your Rare Coin Investments

Similar to the stock market, there are coins that out-perform others when the rare coin market is trending upward. In order to achieve successful results from your rare coin investments, you must first develop an investment plan and carefully select coins that will bring the best appreciation. It is also a wise idea to consider the various circumstances around selling the coins as well.

The first step in crafting a rare coin investing plan is to decide upon the purpose of your rare coin investments. For example, are you planning on holding on to the coins throughout an upward trending market and sell when the market begins to reverse, or are the coins going to be held onto and passed down to family members and future generations? If you are looking for short-term gains, you would be better off purchasing bullion coins and watching the spot precious metal prices. If you want a sound long-term investment, then collecting rare numismatic coins will be a pleasurable and profitable experience.

Determine the Amount of Investment Capital

After determining your reason for venturing into rare coin investing, you will need to decide upon the amount of capital you would like to invest. Is this going to be a large one-time investment, or are you planning on making regular investments each month, quarter or year? The answer to this question will help you determine the amount of money you need to dedicate to achieving your investment goals.

Consider Your Areas of Interest

When business and investing is concerned, personal interests are often secondary to capital appreciation. However, with rare coins, you can delve into specific areas of the market that interest you and still achieve consistent returns. Silver dollars, rare gold coins, historical colonial coins, and the early coins produced by the U.S. Mint are just a few examples of the types of coins that you can specialize in. When just starting out, it is wise to pick one specific area of interest. After becoming an expert in one type of coin, such as Buffalo nickels, you can move onto another coin. Before long, you will be a well-rounded investor with knowledge in every aspect of the rare coin market.

Consider the Individual Trends

Every successful rare coin investor examines the individual trends within the rare coin market, both presently and over the course of the past decade. For example, during the early 2000s, wealthy investors bought up many high-end, early United States coins that were minted before the use of the steam press in 1836. During the same time period, early commemorative coins that were struck between the 1890s and 1950s did not catch the same upward trend. Therefore, the prices of these coins remained relatively unchanged, while many other coins rose significantly in value. The silver dollar market, 1892 to 1916 Barber coins, and 1913 to 1938 Buffalo nickels also tend to ebb and flow over the years, so understanding this and looking at their past price performance can help you determine prime buying or selling opportunities.

Determine How You Will Monitor the Market Trends

Monitoring the market trends is an important aspect of being a successful rare coin investor, but how will you go about monitoring the trends while you are holding your coin investments? Will you be an active investor and be able to stay up-to-date on what is going on in the rare coin market, or will you utilize newsletters and websites to monitor the market? If you choose the latter, it would be a wise idea to subscribe to a popular dealer newsletter, such as The Coin Dealer Newsletter, which is used by all of the major dealers. On the other hand, you can also simply choose to use your primary coin dealer or agent as a valuable market resource.

Keep the Timing in Mind

When selling a rare coin or set of coins, it’s important to be mindful of the timing. You may be looking for a long-term investment and only want to sell your coins upon retirement, but the market may not be ideal for selling at this time. Of course, monitoring trends within the rare coin market can help you stay abreast of market conditions and aide you in determining the best time to sell, but it is also important to consider how outside sociopolitical and economic events will affect the rare coin market. For example, as history suggests, rare coins will undoubtedly perform well during periods of rising inflation, but is the Fed going to raise interest rates in attempt to quell inflation? Or, is the market in a bubble and about to burst, causing an economic depression, which will keep buyers out of the rare coin market?

Consider How the Coins Will Be Purchased

Finally, you must consider whether or not you have the resources and are knowledgeable enough to purchase your own rare coins. To do so, you need to be able to spot market trends, confidently scrutinize the grading of each coin, and travel to major coin shows throughout the year. If you are like most investors and cannot meet these demands, then you can use the services of a representative who is active in the rare coin market. One such representative is Monaco Rare Coins. Monaco Rare Coins is a well-respected industry leader and a trusted resource for buying and selling rare coins.

If you choose to use a coin dealer or agent, it’s important to only use a dealer with a sterling reputation. The dealer should be well known within the industry and have numerous testimonials recommending their services. When purchasing rare coins, it is easy to make mistakes. Unfortunately, these mistakes are often not known until years down the road when someone is interested in selling their coins. Therefore, the dealer you choose should have integrity, knowledge, experience, and national industry contacts to serve your unique needs.

These are the main areas of consideration when developing a rare coin investment plan. Through careful selection, countless investors have witnessed tremendous profits from their rare coin investments. Unfortunately, others have failed to make a plan and have made mistakes as a consequence. To give yourself the best chance of success, choose a dealer who can help you throughout the process and lead you to success as a rare coin investor.

How to Develop a Plan for Investing in Rare Coins
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