So you've been collecting coins for a while and you've decided to get a little more serious about it and start ramping up your investment for wealth growth and/or preservation. Here's what you should know:
Disclaimer: We are not financial advisors and this is not intended to be financial advice. There are risks involved in investing in coins and the markets fluctuate just like other financial markets. This guide is intended for entertainment purposes only.
Invest in your knowledge:
The best advice that we can come up with here is to invest in your knowledge about the coin you're looking to buy. Knowing as much as you can about a specific coin only makes you a better buyer for that coin. Knowing the key dates, the errors, and even what types of grades are out there helps you invest at the right price point.
To get that knowledge about a coin there are various books and publications out there to learn from. The Collectible Craze will be a great resource for learning about coins, errors and varieties as we continue to develop it and grow our personal collection.
There's a lot of online resources available out there as well as different collection guides to help get you started. The reason Phil got started in coin collecting was the state quarter program that the US Mint launched in 1999. That peaked his interest into collecting that laid dormant for many years until recently picking it back up again. Collecting albums and guides are great ways to get started in collecting and investing in your collection.
Assemble a Well Balanced Portfolio:
Just like investing in any market you want to have a balanced portfolio of coins. This market changes and is just as volatile as any other market out there. Putting all your eggs in one basket will put you at more risk if the market were to shift in that coin. While it can be profitable and good to be a specialist it's always important to keep up with the markets and branch out to other coins.
One way to keep a balanced portfolio is to collect the same type of coin in different denominations. For example if you're into something like high graded proof strike Kennedy Halves with Deep Cameo, something like PCGS PR69DCAM, our recommendation would be to form a collection of all the years in Half Dollars and look to expand into the Quarter's Proof collection as well. It's easier to expand into something you already know and since you've been collecting Deep Cameo Proof Halves you're probably becoming an expert in Deep Cameo Proofs that you can easily expand into other denomination of coins.
Buy only high quality Graded Coins:
If you're looking at rare coins as an investment you really need to be investing your money into the best coins. The grading services from PCGS and NGC have been around grading and certifying coins for a long time. A graded coin also adds a layer of protection to you as the buyer as you'll know exactly what you're getting. This just makes it easier and more valuable than a relatively equal raw coin since your coin will already be graded, which takes a time and financial investment as well.
You do need to be aware of counterfeit graded coins however. Both NGC and PCGS have done a good job over the years at fighting this terrible part of the hobby. Both of their websites allow you to verify a coin prior to buying, in some cases with high-res photos of the coin as well. They also do a good job of documenting the different holders and labels they've used over the years so you can review what you're potentially investing in with what they've slabbed over the years.
All in all investing in coins is a long term game. The thing with coins is that they're produced for one year then changed the next, even if it's just the year/date that changes. So, with that mindset we think of our investing more along the lines of what we enjoy to collect personally and long-term instead of short term gains. It's difficult to make short term money in coins unless you're in the market every day looking for price and/or grading errors to capitalize on. So have as much fun as you can investing and collecting.