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Journal entries from the founder of Legend Numismatics, Laura Sperber, help you stay current with the real happenings of numismatics. A former ANA Board Member, Laura has handled close to $1 billion worth of rare coins to date and has assembled many of the greatest collections ever. Her views and opinions are as "inside" as you can get. Warning: ALL her Hot Topics articles are pretty blunt!
Posted: January 14, 2017 03:33 PM EDT| 1 Reply
COIN VALUATIONS AT VERY TRICKY SUBJECT
Valuing coins has become ever so difficult. Today, I cringe every time I see Collectors Universe Values (which are supposed to be full retail), the Gray Sheet (which thinks its retail but is pure wholesale), and auction prices (in my opinion, they are one of the few accurate sources for information-IF you understand them). So what the collecting public has to go by is a cluttered mess of pretty much inaccuracies.
I have yet to see any one entity that reports prices be fully up to date-at least for the kinds of coins I deal in. Usually I see a coin that sold in 2009 that was dreck recorded as the value. A collector does not know that. A collector also does not know why something sells way too high or two low in auction. It very bothersome to me that publications that sell valuations want us to supply them with the information. Its not like I can sit around after doing millions of dollars worth of biz at a show like FUN and just report prices of what I bought.
One collector just debated with me on a series that the coins he was buying he was paying premiums for from me, but in auction and on Collectors Universe they were cheaper. What he did was soley mathmatical (which he is NOT to be faulted on). The pricing of the auctions coins were NOT of equal quality-but he does not know that. Fortunately he listed to reason and bought a pop 2 coin-that probably ranks as the BEST for its grade of a date that appears maybe once every decade. For coins like this, you have to have the mindset and pay premiums-that is how the greatest-ALL the greatest collections are formed. And that really is the only way you will own them even if you aren’t building the biggest collection. If you try to be a cheaper buyer or a total “bottom feeder” you could easily run into big trouble not knowing where the market really is on coins YOU think are quality (but really are not).
So what do all the numbers really mean? Work with a dealer to interpret them. The 5% you spend for auction representation is more then worth it. If you are that independent, use the numbers-all the numbers you can find-as a guide only. Study the auction history and most critical: how nice is the coin you are buying or selling? “Stuff”coins-once that are 85% all there do NOT command anywhere near PQ prices unless uniformed buyers bid them up.
A DIFFERENT MARKET TODAY
We are now finally bottomed from the 2010-mid 2015 spiral down. Unfortunately, you might have a price reported from that time that we all know is ridiculously cheap. A great example: many of the coins in the SECOND Gardner sale cratered. So those are the only prices you see posted for VERY low pop gorgeous rarities. Sadly we have seen many collectors not “get it”and pass on those coins which are slightly more today. They did not realize how low those prices were. Plus, something the legendary collector Bob Simpson does-he always buys for tomorrow. In fact every major successful collector: Norweb, Gardner (even with a market downturn), Pittman, and Pogue ALL earned HUGE rewards fro paying top dollar and holding.
One other thing that lights me up: when someone says the last coin traded in 2011 and acts like that was yesterday. Hello! That SIX years ago now!!!! People need to take better stock in what has happened in between then and now. How many new coins were made (if any?), and how many have traded, etc. If you don’t have the tools to track all this-work with a dealer! To me, if nothing has appeared in 2 years or more, that is friggen rare!
The basic premise of this article is current coin pricing on BETTER coins is off-way off. I admit I do use Collectors Universe Values and auction prices realized. BUT (BIG BUT) I know how to read and interpret them. Do NOT pass up any high quality LOW POP GEM coins because they are 10-25% over the printer numbers. There is a VERY high % the printed numbers could be wrong for many reasons. Collectors Universe pricing ground to a halt last year when David Hall took ill. He still has not updated a lot of things (there are thousands of prices to update).
A TALE OF TWO 1933 $10’s IN GEM
Look at the 1933 $10 in MS65+66. The Collectors Universe Value is $750G for the 65 and $1,000,000.00 for the 66. We’ve passed on an offer of $1.2 million for the 1933 $10 PCGS MS66 CAC that we STOLE in a 2016 auction for $881,250.00. We got lucky and caught a dip of big money panic in the market (one month later a mega whale came in and spent at least $40 MILLION buying up better gold July-Dec). NO expert in the series expected that coin to sell below $1-$1.5 million (really)! Now the printed auction number sort off holds the 66 back. As the market moves forward this coin WILL be back to a $1.5 million value easily (the coin 100% is NOT for sale). Now, that coin DID do damage to the VERY high end PCGS MS65 CAC we paid $822,500.00 for in 2015. That coin should be a “no brainer” worth what we paid. On the surface, the printed numbers damage it as does the price realized for the MS66. The coin is super high end and is the ONLY PCGS CAC piece to ever sell. So it is trapped in numbers hell for now.
The collector who offered us $1.2 million is along time buyer of the series and knew that with 30+ years passing the MS66 has stood alone. he kinda got scared off during the auction of it. His next shot maybe $2 million plus if it ever comes to market. A HUGE opportunity misjudged.
On coins not as rare-like MS+PR Barbers, prices seem to bee moving ahead of the published numbers today. look at the coin and pay close attention to CURRENT auction prices realized (these are more commoner coins).
Generic gold is pretty easy as publications like Coin Dealer Newsletter (which again, really IS WHOLESALE) picks up the BID/ASKS from the biggest players and dealer only web sites. But there too-if you have a stunning $20 PCGS MS66 CAC Saint with glorious colors and the seller wants $5G, they are probably not taking a shot at you.
IN THE END
The value of ANY coin is determined (in my opinion) by SUPPLY, DEMAND, QUALITY, and EYE APPEAL. EVERY one of those factors plays into a coins value. Only use pricing web sites or published letters as guides. Auction prices realized do work very well-but get a tutoring or work with a dealer to fully understand them. A great example: I just bought an 1851O NGC MS65+ CAC G $1. There is NO auction price for an NGC coin. A PCGS one sold for $8,225.00 2016. BUT, the last PCGS and NGC regular MS65’s sold for $12,925.00 2015. The current CU value is $9,500.00 for the 65 and $11,500.00 for the 65+. I paid just UNDER $10G because the coin has glorious colors and am confident it will cross. I’ll retail it for 10% over my cost and cost of submission. That $8,225.00 number was simply a fluke.
Hope I was not too confusing. I do not see this pricing situation improving any time soon. The coin market is at a bottom today. Do not be afraid to buy for tomorrow and pay a premium!
Any questions or comments, please email me direct: firstname.lastname@example.org
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