Coin Investing 101: How to Invest in Rare Coins
During this uncertain time, we are unsure of how the U.S. economy and the world’s economy is going to pan out. Millions across the globe worry about their employment and their income. More than ever, people want to save their money. They also want to invest their money.
One of the best investment methods today is in coin investing.
Investing in rare coins is a fun hobby – but it can also be a lucrative one.
But how exactly do you get started? We’ve put together this guide to show you how.
Table of Contents
The Guide to Coin Investing
The first thing we ask is that you are patient. Simply hoarding coins that existed during your great-grandparent’s childhood is not the answer.
You need to do your research properly to know which coins you should invest in.
Here’s what you need to know:
You always hear about the importance of diversifying your portfolio. What this means is that you need to have different coins in your portfolio. You don’t want to put all of your faith into one coin.
For example, if you are going to invest in the U.S. coins, you want a collection of old nickels, dimes, half cents, and half dollars.
Coins also include investing in precious metals such as gold coins and silver coins. As a side note, while your focus should be on coins, you may also want to consider buying precious metals as bars. We encourage you to consider platinum bars as an investment.
Investing is for the long-term. Purchase the coins and hold onto them for liquidating much later.
2. Research the Coins
You must also meticulously research the coins beforehand. Do not just purchase what others are purchasing or what intuitively appeals to you.
For example, you may wish to conduct research on a particular series of coins such as old nickels in the U.S. Or you may want to look at currencies not in circulation, such as various European currencies that were in circulation prior to the adoption of the Euro.
You can conduct your research on the internet. We suggest finding an expert who already invests in coins. You may also want to look up known investors such as Robert Kiyosaki, Mike Maloney, and financial writers such as Ramit Sethi to see if they have any advice on investing in coins.
There are also a plethora of books available that discuss coin investing. Find the best ones and study them immensely before you start hoarding coins.
3. Go to Coin Shows
While you can buy coins from a shop or online, we also recommend going to coin shows if possible.
Coin shows are great venues to buy rare coins. You may also be able to purchase research material (such as books, instructional videos, etc.) on how to invest in coins. You’ll be able to mingle with more experienced coin investors who can advise you.
You can strike up relationships with coin sellers who can always sell you valuable coins at a great value. You can also strike up relationships with seasoned coin buyers. If you ever decide to liquidate your collection, you’ll want to call up these coin buyers.
4. Only Buy Certified Coins
How do you know that a coin is valuable? You should make sure that any coin you purchase has been certified. The two most popular bodies for certifying coins are the Professional Coin Grading Service (PCGS) and the Numismatic Guarantee Corporation (NGC). We only recommend getting your coins certified by these two bodies as other third-party certifying agencies are not well-recognized or respected.
These agencies will grade the coin which will help determine its value. Ideally, you want to purchase a coin that has a green CAC (Certified Acceptance Corporation) sticker. This green sticker means that this coin is ‘solid for the grade.’
You can also consider coins with a gold sticker. This sticker indicates that the coin is of premium value for the grade.
The certifiers will also be able to check coins that have been doctored or counterfeited. These coins will not be worth any value and are created by scam artists. Always check with a certifying agency before you buy or sell coins.
5. Look at Gold, Silver, and Platinum Intently
Let’s return to discussing precious metals. As we mentioned previously, the three types of precious metals you should focus on are gold, silver, and platinum. Your portfolio should be a mix of bullion bars and coins.
You may wonder which to focus on as a beginner. While your ultimate goal should be to invest in all three, you are likely to have budgetary restraints at the beginning. We recommend that you study the price trends of these three precious metals.
For example, if Silver is more affordable and has been rising, you might want to invest in it. If Platinum is at an all-time low, you may want to invest in it even if the price is stagnating for now.
It’s crucial to study the history and use of these precious metals. While Gold may be more valuable than Silver, the latter is easier to liquidate and is used in a variety of industries. Platinum might also be what many jewelers are looking for. Research what these metals are used for when considering which ones to purchase them.
When it comes to purchasing coins of these precious metals, you want to look at which coins are more prominent. You may prefer a Silver Britannia, but it might be wiser to invest in a Silver South African Krugerrand.
Enjoy Your Collection
Finally, we encourage you to enjoy coin investing. This is a form of investing, but its also an exciting hobby. Treat it as such so that you can dedicate time to making the best investments.
Interact with other coin buyers and sellers. Buy a coin album to keep your coins safe. Enjoyment will make you more focused on making wise investments.
We encourage you to read more great articles on investing and building a lucrative income on our website.