While most people hear the word “investing” and think of the stock market, a mutual fund, or some other traditional way of growing their money, rare coins are increasingly becoming an option in a society looking to insulate itself against the risks associated with traditional stock market investments. Over the past several years, especially, rare coin investing has grown at unprecedented rate as both collectors and those with a financial prerogative look to make big moves with their investments.
For those who are on the fence about rare coin investing, as well as those who aren’t quite clear about what the field entails, it’s worth learning the top ten benefits of moving at least some portion of an investment portfolio into this growing industry. Whether it’s the benefits of diversification, the long history of stability in the industry, or another reason, it may be time to make a big move toward rare coins.
1. Rare Coins Have Historic Value
The great thing about rare coins is that they’re actually as interesting historically as they are beneficial financially. These coins are often at least a few decades old, with many of the rarest investments dating back to the 19th century or earlier. Many coins were minted to commemorate special days in American or world history, giving each coin a story that will be worth telling when showing off the collection to friends, family members, or fellow collectors.
2. Coins Generally Benefit from Precious Metal Materials
The great thing about rare coins in today’s marketplace is that many were minted with a high concentration of silver, gold, or platinum, largely because many of today’s rarest coins were minted to commemorate a milestone in the United States or around the world. The tradition of minting bullion coins as commemorative keepsakes is a practice that remains today, although recently minted coins are not nearly as rare or valuable as their older counterparts.
The overall material composition of rare coins, combined with their rare and historic nature, allows them to hold value even when the broader stock market takes a dive. In fact, precious metals usually increase in value during times of economic uncertainty. This acts as a very effective buffer against deeper losses.
3. Purchases Can Be Made Online and Off
As the industry has grown, the number of options for new investors has grown with it. Today, online firms like Monaco Rare Coins sell scores of coins to new investors while offline dealers remain quite popular among collectors and those who prefer an in-person presence. The growth in the industry, as well as the availability of reputable online buying, makes it highly accessible for people of all backgrounds and experience levels.
4. Coins Can Be Held Onto
A stock used to involve an actual paper transaction, with the holder of a given stock owning a “piece” of the company. That is now no longer the case, with transactions made using electronic means and stocks representing more of a theoretical investment mechanism than one that can be held in the hand and showed off to friends and family members. In this way, rare coins are actually a bit old fashioned, serving as a tribute to their historical nature. Investors in this industry get to actually hold their coins, store them where they like, and view them at any time. It’s a minor difference that feels very big, especially when the stock market begins to show signs of uncertainty.
5. Coin Prices Grow and Stabilize Reliably
Investing in rare coins might seem like a gamble, especially since it’s so very different from traditional stock market investments and other financial products sold by the big bank. For the past several decades, though, coins have actually grown very predictably and reliably in value. At the very least, they have remained stable in many cases without a loss in value that negatively affects their investors. This is because coins will only get more valuable as their history grows, and as bullion prices continue to increase for the foreseeable future. This offers a form of protection against losses incurred by a consumer’s portfolio in other areas.
6. The Industry is Self-Regulating
Unlike major financial institutions, rare coin investing does not go through numerous government agencies and regulators. That might raise some eyebrows, and many people might think that this exposes them to greater risk. Instead, it actually exposes them to better prices and better deals. That’s because rare coin firms don’t have to pay the high cost of regulation and inspection like banks do. They’re held to different standards, and that works for consumers’ wallets.
7. Multiple Industry Organizations Exist for Regulation
As a sort of checks-and-balances system within the rare coin industry, there are at least two major organizations in the United States that verify the reputation of dealers and the value of their coins. The first is the Professional Numismatists Guild, which is easily the largest and most historic organizational body in existence. The guild is responsible for verifying the products, promises, and tactics used by each member company. If any company fails to live up to the PNG’s standards, they’re simply asked to exit the guild. The second body is the American Numismatics Association, which has even more stringent requirements for membership than does the PNG.
8. Coins are Measured by an Index
Lest new investors believe that rare coins are not governed by some sort of index, that belief can be easily dispelled. The PCGS3000 is pegged to the value of several leading rare coins, and it generally serve to govern the wider value of all rare coins held by today’s investors. Despite a downturn several decades ago, the index today remains relatively stable and on reliably upward trajectory.
9. There are Lots of Trade Shows
People get into rare coins for one of two reasons, or perhaps both: The coins are a great investment and they have serious historical value. That lends itself to conventions and trade shows that discuss rare coins, show off some seriously rare options, and enable person-to-person transactions. It’s an exciting way to connect with fellow investors.
10. The Industry’s Growth is Dynamic
Rare con investing has grown in a big way over the past decade and it shows no sign of slowing down. Consumers are finally beginning to understand that a diversified portfolio means not just different stocks and strategies, but different mechanisms entirely. Rare coins are a great way to accomplish that key diversification and, as more consumers realize that, the industry will continue to grow and expand both in options and in value.
A Great Way to Diversify and Invest
Long-term stability and value characterizes rare coin investments, allowing those who make the leap into this industry to enjoy peace of mind and solid gains. For that reason alone, it’s a good idea to look into rare coins as a way to build a solid financial base for decades to come.