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Coin collecting a good investment?
Daily Southtown - April 23, 2007

A retired federal government agent recently asked me what my feelings were concerning coin collecting relative to the investment world. After a stimulating conversation, I decided to write about that very subject.

Coin collecting can start out as a hobby and grow into a serious investment opportunity. According to Wikipedia.com, the free encyclopedia, modern coin collecting is believed to have begun in the 14th century. Today, there are many different ways to start a collection. You may collect sets of coins, specific years, mint marks or even error coins. You may recall a few weeks ago when a mistake in minting the new dollar coin was discovered, which sent the value for those coins well past 200 dollars for a single coin. If you were lucky enough to have had one of those coins, you could have had an instant windfall.

Coin collecting in the investment world is similar to the way the stock market goes up and down. A coin that is not worth much today may increase in value and vice versa. The coins that typically bring the most value are numismatics, which according to Webster's dictionary, is the science of coins and metals. A numismatist may or may not be a coin collector and a coin collector may or may not be a numismatist.

By using this science, a number is given by recognized rating services to a coin, and placed in an encapsulated case to preserve it. A higher number tells you that the coin is cleaner and less circulated. This numbering system makes buying and selling easier.

The fact that a coin is old does not necessarily mean that it is valuable. It may be that in a given year only a certain number of coins still exist and this fact may cause those coins to be rare, thus worth more money. Old coins that are damaged with holes, dents or that have been repaired may lose their value.

The material that was used to mint the coin can be a factor in determining the value. Just take a look what has happened to the price of gold in the last year and a half. Coin prices can be cyclical, similar to a sector mutual fund.

Whether you are just starting out collecting coins or if you have amassed a huge collection, you need to take caution when selling your coins. There are thousand of books and many Web sites that seem to offer an endless supply of information. With the Internet, there are many more opportunities for collectors than ever before, however, there are also many more coin scammers than ever before. If you are going to collect coins for investment opportunities, you will probably be more profitable if you deal with numismatic coins. You may want to purchase some type of consumer protection guide.

Chances are that you or someone you know has collected a few old coins through the years. Many people have large coin collections and begin to sell them off to supplement their retirement. Others pass the hobby down to their children and grandchildren. Whatever the reason, coin collecting can be both fun and profitable.

Daily Southtown - April 23, 2007

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Coin Collecting a Good Investment? - Coin Collecting

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