Price Declines Spell Buying Opportunity|
October 21, 2013
In recent months it has become a buyer’s market. Retail attendance at shows and coin shops is down, especially for those who collect and purchase the more moderately priced items. The weak areas include modern high-grade issues, most Mint products of the last 50 years and many of the popular collector series of the 20th century. Also included are generic gold, silver and platinum issues of which many are included in the modern Mint products.
The 12-year-old bull market became tired a year or so ago and was disguised by, and was held up by, strong precious metals. These strong metals prices also added extra liquidity to dealers, investors and traders positions, which overshadowed underlying weakness. But the main culprit is the underlying turbulence and weakness in the economy. Also, collectors who started with state quarters have become inactive. Does that mean coin prices will be permanently lower? No, it just presents a good buying opportunity for those with the wisdom to act.
How do we translate the above into the actual market? One way is using historical data in terms of premiums for finding scarcer issues over generic bullion-related coins. Good examples are the $20 Saint-Gaudens coins that can be found at $100 to $200 over common dates that were once double common pricing. Another example is a 1914 $2.50 Indian gold coin that is currently about 10 percent over common pieces in circulated and low Mint State grades and was once 50 percent over. Many key 20th century issues have declined over the last two years and are now good value again. It is impossible to pick a bottom. Do your research, buy, then wait. It is a good time to fill in any 20th century key dates you still need.
Issues that have declined recently are 1909-S VDB, 1914-D 1922 plain, 1931-S and 1955/1955 Lincolns. In the Indian cent series look at 1877, 1908-S and 1909-S or try 1885, 1886 and 1912-S Liberty nickels. The 1913-S type two and the three-legged Buffalo are looking reasonable, too. In the Mercury dime series the 1916-D and both 1942 overdates have come down to more reasonable levels. In Washington quarters the 1932-D-S duo still has room to go down in circulated grades especially below EF-40. I would also avoid the 1938-D Walker under EF-40 until it drops another 10 to 20 percent.
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