NumisMedia: On "Top of the Market" for 2008 Posted on 1/24/2008
Early indicators suggest that 2008 could be a remarkable
year for rare classic coins with low mintage and census numbers.
Numismedia offers advice on how to make the most of this opportunity.
The past year has seen a very active market for the majority
of numismatic coins. This year could prove to be even more
remarkable, especially for rare classic coins that have low
mintage and census numbers. We have monitored a number of
coins that have increased in value substantially over this
one-year period. Some of these coins had not appeared on the
market for some time. In other examples, the current demand
has simply forced the FMV to much higher levels. When making
comparisons of FMV data, make sure you also compare the census
reports from both timeframes as well to determine the increase
in the number of coins certified for a specific grade. Below
is a list of various issues that have increased substantially
since the beginning of 2007.
The common characteristic of these coins is that they are
all rarities by original mintage and have a very low census
in the grades listed. In fact, these particular issues have
a very low availability in just about all grades. As long
as the coins are accurately graded, there are buyers for these
coins. The trend for early coinage should continue, since
the demand for these coins in NGC and PCGS holders remains
very strong. Bear in mind when pursuing any rare coins that
they must be accurately graded. Some coins offered in auctions
that are in grading service holders other than NGC or PCGS
are seemingly rare, but have damage of some sort. These coins
consistently bring discounts of the listed FMV and are typically
purchased by collectors as fillers for their sets.
A new year always brings questions as to what will be the
hot series in the coming months. Many dealers have stated
that any of the coins minted prior to 1900 could play a very
strong role in collector demand. Astute numismatists have
made it quite obvious that they are looking for quality coins
that are not found in every dealer inventory. When you start
comparing the number of coins certified in most series prior
to 1900, with those coins minted afterward, there is little
reason for the newer coins to be valued at the same levels
as the older ones, especially since there are fewer high-quality
pre-1900 coins available.
In many cases, the reason that most of the more recent coins
have been in such demand is the fact that they are available
to market in large quantities. This is known as programmed
marketing . In order to sufficiently advertise a specific
series of coins, you must have a large enough inventory to
sell to adequately absorb the cost of doing business and make
a profit. It is quite difficult to advertise a limited number
of rare coins and have them absorb all of the cost of marketing.
This will typically make the price of the single coin appear
too high to the normal buyer. However, advanced collectors
are realizing that the slim number of coins available provides
a very opportunistic timeline for acquiring coins that have
potential. At the rate the coin market is advancing, the number
of new collectors will soon deplete the current supply of
pre-1900 coins based on relative value to post-1900 coins.
In the past year, the rarity of pre-1900 coins has become
much more apparent to collectors and the demand has thrust
the FMV to higher levels. Here again, we feel the need to
stress accurate grading for coins to command current FMV levels.
Advanced collectors do not want coins that exhibit any kind
of problems, including distracting marks or color. Further,
they will pay a premium if the coin has exceptional eye appeal
for the grade. Most dealers feel that Bust and Seated coins
will lead the market for 2008; this includes all copper, silver,
and gold issues. Just in the last few months we have noted
the FMV on the rise for Seated coinage in MS63 and higher.
In some cases, the FMV has climbed 25 percent.
Also watch for programmed sales efforts for specific areas
of the market. Morgan Dollars in MS64 through MS67 are always
a good product for the high-volume retailers in the country.
We have noted one of the major players currently in the market
for MS65 Morgan Dollars and will take up to 1,000 coins. This
is a good indication that they feel this area can make a concerted
advance in the first six months of the year. Look for other
areas like this where large quantities of very popular coins
could be available for an extended marketing program. Walking
Liberty Half Dollars are always good sellers and so are Peace
Dollars, although they do run in streaks at various times.
Classic Gold and Silver Commemoratives are very trendy and
tend to run in cycles. We do not see a lot of interest in
them at this time, except for individual collecting. However,
when the time comes, these can move very quickly. If realistic
opportunities are present, purchase coins that have eye appeal
so that you can make top of the market profits.
Watch for dealers stocking up on these issues and follow suit.
Just be ready to sell into any of these markets when profits
are substantial. Once the end is in sight, it is difficult
to sell at higher levels. Remember in June 2006 when the MS65
Morgan Dollar FMV went well over the $200 level for common
dates? Since the top of the market, they have not recovered.
Is now the time?