Investing In Rare Coins
Successfully investing in rare coins is not a simple task that can be learned in a short period of time. As with any investment, diversification is the key to reducing risk. Your portfolio of rare coins should include a variety of coins that will minimize market fluctuations and maximize returns. It should include classic United States coins such as half cents, large cents, early nickels, dimes, quarters, half dollars and silver dollars. You may also choose to invest in precious metals such as gold bullion coins. Classic gold coins ranging from one dollar gold coins through $20 gold double eagles will also provide diversification in your rare coin portfolio.
You may hear stories about people "flipping" coins for a quick profit. This is the rare exception and carries a high amount of risk. Looking for a quick profit is an investment mistake you want to avoid. The most successful investors in coins had an extremely long-term vision that took years, if not decades, to assemble. This time was spent learning about the coins they were purchasing and studying the market valuation of each and every coin they purchased. This enabled them to spot coins of truly exceptional value.
The most sound investment advice for investing in rare coins is reflected in the old adage, "Buy the book before you buy the coin." The knowledge that you acquire through education will ensure that you fully understand the investment that you are about to make. Specialize in a particular series of coins or type collection that you want to assemble. Then acquire the knowledge that will enable you to identify quality coins at fair market value.
There are enough books on coin collecting to fill an entire library and more are being published every month. Therefore, there is probably a book already written with the knowledge that is required to make an informed investment decision. From Sheldon varieties of large cents through VAM varieties of Morgan and Peace silver dollars, there is a book that you can study before you invest in a rare coin.
Additionally, the Internet can provide a wealth of information on the rare coins that you are considering for investment. But remember, everything on the Internet is not necessarily true. However, it can be a great source for determining the market value of the coins you are researching for investment. There are pricing guides such as The Gray Sheet, the Redbook, and various auction results. Depending upon the rarity of the coin, auction results provide the most transparent measurement of value since the transaction was conducted in a public forum.
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