INVESTING IN COINS.
The Advantages of Coin Investment
2. Easily stored: In the smallest-size bank safety deposit box available, you can safely store enough rare coins to buy a car or a house. Of course, if you invest in quantity rather than rarity, you could fill up your bank box with bullion coins truly "worth their weight in gold," or silver.
3.Portability: Coins can be transported anywhere in the world with the main concern being their cumulative weight. You can't move a car or a house with as much ease.
4.Durability: With proper care, coins will last indefinitely without deterioration - certainly throughout your lifetime. How durable is a 18th century oil painting ? If you drop a coin that's been encapsulated in a protective plastic holder, chances are it will survive without injury. Can the same be said of an antique porcelain vase that's been knocked over? Which do you think will age faster, a classic automobile or a gold bar ? What will probably withstand a devastating fire better, a rare book collection or a coin collection?
The Disadvantages of Coin Investment
Sensible people keep a balanced view of their financial affairs, whether investment-related or otherwise, so we need to keep in mind the disadvantages of plunging into coin investment:
1. No regular income interest accrues from coins or bullion. All profits or losses are theoretical and only on paper until the actual items are sold. Bank savings accounts and stocks, apartment buildings, and private businesses pay regular dividends on the principal invested.
2. Some coins are more liquid than other. They may take a while to sell for the best prices, and you have to research the market to know where to sell them, especially for esoteric coins whose major value lies in finding the proper buyer.
Tunku gold pieces are recognized by all coin collectors. But where do you go to sell coins such as Parliament errors or Bunga Raya rare coins if you seek top dollar? Whether at auction or direct sale, you need to research the market to find out where to sell any coins at maximum profit.
3. There is difficulty in buying premium quality coins cheaply enough to make a return on your investment. Premium-quality coins are defined as the better examples of their type and grade.
Not all MS-65 Queen Elizebeth 50 Cents look alike, and not all are worth the same money in the coin market. Where do you get a premium MS-65 Queen Elizebeth 50 Cents without paying so much for it that you may have to wait years before selling it at a reasonable profit?
4. One must be wary of problems with coin grading and tampering. If you think that the used car market is ripe with potential fraud, wait until you begin exploring high-priced coins for investment. Overgraded and cleaned coins are abundant, and have always been so in the market. Do you know what grade you are buying, despite the assurances of the seller? Can you detect the difference between faked rare coin and genuine ones? Have you studied a particular coin series long enough to be able to discern original mint surfaces from the results of cleaning?5. Market fluctuations are impossible to predict. Many of the prominent coin collectors and dealers in the United States lost large sums of money when the coin market dropped significantly in 1989.None of them would have lost money if they could predict the future movements of coin prices.
Bank accounts are boring and very predictable, but guaranteed by our government. Can you sleep well with your life savings tied up in rare coins,hoping that their value don't drop in the future market.
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