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Proof coins for investment - worth it?


caloundracats

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Hi Folks,

Wondering what the general opinion is on Proof Coins with COA for investment purposes with limited mintage. From experience, do you feel they increase in value over time,?

Interested as thinking I may get hold of some so comments and advise most welcome. Thanks All.

Cathy

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I believe they will appreciate. I buy them.

But I have no experience, who does? Proof coins are quite a new product (yes, there are older examples, I know)

Technically, alcohol is a solution..

'It [socialism] poses a growing threat, however unintentional, to the freedom of this country, for there is no freedom where the State totally controls the economy. Personal freedom and economic freedom are indivisible. You can’t have one without the other. You can’t lose one without losing the other.'

"There is no such thing as public money, there is only taxpayers' money"

Let not England forget her precedence of teaching nations how to live.

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Thanks  you all for your comments, and I did view the video. Although a 'newbie' my strategy is to only purchase bullion coins and bars (in the future) as funds allow and hold for the long term. I choose mostly Commonwealth coins which all seem very popular and have clear well defined images in the main with the exception of a few from the Royal Mint which I don't  possess.

However, I have come across several new bullion coins with very limited mintage - talking 5,000 and also less than 1,000 with general appeal IMO. I have been led to believe that no BU coins will follow on so it's the proofs or nothing. Of course they come with extremely high premiums and are aimed at the collector. Magnificent coins but I'm going to have to be quick or miss out. They are produced by well respected mints ensuring the quality is top notch so will never be on the pile to melt down in future.

I'm just undecided as to whether or not to purchase or use the funds for Britannias and the like. 

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One thing to understand is generally collectors buys proof coins and store them with care. This is a blessing and a curse. Blessing because you generally can find earlier proof coins with very high grades as they are preserved well. Curse is more interesting. Historically there are many examples where US proof coins are much rarer on paper in terms of mintage, but are readily available decades later. On the other hand, sometimes people ignore seemingly high mintage non proof issues and years later most got either circulated or destroyed/melted and gem examples become very rare and much more expensive than proof counterparts. It sounds counterintuitive but it happens.

 

As for modern bullion coins, if they are not rare and are not in high demand, then yes most chances their proof counterpart will be worth more down the line.

 

 

 

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The term ‘proof coins’ is a pretty big range of possibilities what you could mean. Proof sovereigns, disney commemoratives, panda show medals, ...

If it’s purely for investment I would in general stay away from proofs, especially the very low mintage ones. The audience wanting to pay a significant premium in the future for whatever proof you buy today will be small(ish), so it will take time and patience to find the right buyers and get your money back down the line, which I believe would be your goal. Imagine how long it would take you today to sell, say, 20 proof lunar 1 coins. I think you’d have to wait a while which isn’t very convenient if you need to cash out in a hurry, and always be aware of the risk that you might not sell everything/would have to sell lower than you paid for.

Sovereign proofs in the UK might be a somewhat safe(r) bet though, if you know the market and do your research. Or US Mint proofs in the US, though there are also examples where people were paying exorbitant premiums at launch only to see the value drop over the coming months/years.

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I generally only collect proof coins and have been doing so for many years. I guess first of all it depends how much you pay for them in the first place. Some of the five pound coins that i collect can be seen for sale on Ebay for extremely silly prices but with a little patience and knowing  when and where to buy from you can get them for much more reasonable prices and then stand a fair chance of an increase in value from your original purchase price if you look after them well. Of course condition is very important with proof coins in particular when you think about selling, it can take some time to find specific coins for the right price in top condition. I was looking for a particular dated £5 in top condition for about two years and found one by chance at the recent London coin fair for a very good price.

The main problem that you can get buying silver proof coins is that even with the most careful storage they can often develop spots and haze which of course will reduce the value in most cases. Generally you do not get such problems with gold proof coins.

 

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Proof coins are a higher risk in general. Knowing what is and isn't going to be a winner takes research and a gamble. On some of them it is better to have the highest grade possible in hand like a NGC PF70 UCAM or PCGS PF DCAM. Actual mintage numbers is only part of the equation because if nobody wants them after the fact it wont matter if they only made 100 of them. Generally speaking the ones from govt. mints seem to do better. Look at the 2014 Britannia proof! The actual design is another one to try and pick right when they are first released. All in all there ends up more that are duds than are winners.

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I think its fine as long as you understand the difference between a commodities/precious metal investment and a collectibles investment.  They are both perfectly okay, but they have different timelines, and react different to varying economic conditions.  Collectibles, for example, tend to act like expensive cars, boats, etc, during a market downturn.

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9 hours ago, Fivepoundfred said:

I generally only collect proof coins and have been doing so for many years. I guess first of all it depends how much you pay for them in the first place. Some of the five pound coins that i collect can be seen for sale on Ebay for extremely silly prices but with a little patience and knowing  when and where to buy from you can get them for much more reasonable prices and then stand a fair chance of an increase in value from your original purchase price if you look after them well. Of course condition is very important with proof coins in particular when you think about selling, it can take some time to find specific coins for the right price in top condition. I was looking for a particular dated £5 in top condition for about two years and found one by chance at the recent London coin fair for a very good price.

The main problem that you can get buying silver proof coins is that even with the most careful storage they can often develop spots and haze which of course will reduce the value in most cases. Generally you do not get such problems with gold proof coins.

 

What coin was it m8. Ps I was at that coin fair was great day 

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It was a 1993 40th anniversary of the coronation gold proof five pound. Got it from one of the dealers i know who normally only sells silver and notes at the shows, he just had this one gold coin, luckily in perfect condition so sent to PCGS last week for grading.

Yes as it has already been mentioned low mintage proof coins are not guaranteed to be more valuable / profitable than others and the value of some proof coins sometimes rise dramatically owing to demand. A good example of this is the 1999 Diana gold proof five pound which had the highest ever mintage of a commemorative  RM gold proof coin at 7500 and have been selling for 3K + and fairly recently the RM themselves were  trying to sell one for 6.6K ?  If you shop around you can buy a very nice 1998 GP Prince Charles five pound for maybe £16 -1700 but only 773 were minted ?  I guess this may be a reflection of the popularity of some members of the Royal family, but you have to admit she does look better on a coin than Charles !!

Another example is the 1937 gold proof's, the prices have rocketed over the last couple of years, Jon Blyth selling a nice five pound on Ebay right now if you have a few quid to spare ? It will be interesting to see the final selling price for this coin, a similar one sold in the USA for 16.5 K earlier in the year.

 

 

 

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This is a huge topic, but I'd say the biggest problem with proofs is that there are so many of them.  Some mints like Canada are notorious for pumping out limited mintage proofs of whatever.  Don't fall for the idea that because something is limited (or "Sold out at the Mint!") that collectors will be desperate to get a hold of them in the future.  I'd say most modern proofs are duds from that standpoint. 

That said, there are some modern proofs that are part of popular series that do very well in aftermarket.  Numistacker, Shadowstack, and Backyard Bullion all did excellent Youtube videos on the subject. 

Good luck!

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15 hours ago, caloundracats said:

Hi Folks,

Wondering what the general opinion is on Proof Coins with COA for investment purposes with limited mintage. From experience, do you feel they increase in value over time,?

Interested as thinking I may get hold of some so comments and advise most welcome. Thanks All.

Cathy

If you are primarily looking to make money from proofs gold or silver, there is a very steep & expensive  learning curve, my advice would be research research & research again.

Re value over time some increase some don't, bit like antiques, sometimes they are in fashion 5 -10 years later on they are not. Look to see what has stood the test of time.

 

The problem with common sense is, its not that common.

 

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The thing I don't like about collectibles, and proofs specifically, and someone else had a similar thought above, is that you're basically becoming a dealer when you get into that.  You may not own a shop and have to cover a spread with your customers, but you're still out there marketing your wares when you get ready to sell, you still have to find and/or create a market for your "product".  Now for most people that means going to the local coin shop with hat in hand begging for a good price, but for the more savvy that means you're on ebay and other platforms, beating the street, looking for someone to give you the price that you want so you make some coin on the transaction.  Even when you do that, unless you've found a way to do that in volume and keep shipping costs low, it's hard to turn a profit on that kind of endeavor.  Even shops have a hard time, and they make money on the spread .. paying as little as possible for coins they buy from collectors, and charging as much as they can selling to those same collectors.

Me, I'm just too &^%$ing lazy to do that.  It's not that I don't like the coins, I think a lot of them are beautiful, but I don't have the patience to sit around dusting cases of proofs, keeping up with what's hot and what's not, and generally being a coin collecting geek.  I understand people who like to do that, and there is money to be made doing it if you know what you're doing, but it just doesn't jive with my own personality.

I think a lot of collectors get into collecting without a thought of how they'd get out of that "investment".  They imagine they can sell it, but it's like Warren Buffet said, the way to know what something is worth is to buy a little bit of it, then try to sell it.  I think most collectors are buying at what they believe are reasonable prices, enjoying their collection, have no idea how they would sell it, ... and I think all that is perfectly fine if they're getting value out of it and it's making their life better and they are happy doing it.  I appreciate other people's collections because without individual collectors we wouldn't have a history, collectors are the ones who store this collective material history that we have together, I just think it's important to be honest with yourself about what your role in the game is before you put on the uniform.  Are you a collector ?  A historian ?  A dealer ?  An "investor" ?  These aren't all the same thing.

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Excellent post.

Technically, alcohol is a solution..

'It [socialism] poses a growing threat, however unintentional, to the freedom of this country, for there is no freedom where the State totally controls the economy. Personal freedom and economic freedom are indivisible. You can’t have one without the other. You can’t lose one without losing the other.'

"There is no such thing as public money, there is only taxpayers' money"

Let not England forget her precedence of teaching nations how to live.

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I would say there are quite a few coin people who would say that they are both collectors and investors. They have a personal interest in coins and see their coin purchases as a safe place to " bank" their money and probably hope to see that investment grow a little over time. Lowlow commented that a lot of collectors buy coins without having a thought of how to get out of the investment which is true, but to a pure collector investment may be of no concern to them, they could pay any price for that special coin that they want whilst having no thought at all of selling it in the future or for what price they could get for it if they did.

However if the financial aspect of coin buying is relevant you certainly need a strategy including a "get out plan" if you need to sell in the future and buying wisely in the first place. 

 

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Thanks again all. I have purchased a couple of proofs, not your run of the mill type, but ones that appealed and have meaning to me. I'll take some pictures when I get them and upload if I can (bit technically challenged!). A born collector these will be for my enjoyment and long term investment. The rest of my 'stack' will be bullion BU's and the odd small bar as funds allow.

I appreciate everyones comments and links and find this forum not only welcoming but a huge source of knowledge. I have spent hours viewing videos and comparing sites and general research. Just wish I had thought about collecting silver years ago rather than the items I did collect and were on display to enjoy but of little value.

Having thought about buying bits of silver for a long time, I took the plunge when I woke up one morning with the bright idea of purchasing a few 2017 coins for my first grandchild born last year. I thought a  2017 UK and Perth Lunar, a Britannia and an Anniversary Britannia would make a lovely 21st present for her in 20 odd years time.

Now my collecting genes are awoken once again!

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Questions I would ask myself are, is it a proof from a collected series? (then it's a safer bet), is it a unique attractive design? is the mintage low vs likely demand? is it from a respected mint?

Those are some good boxes to tick

Proof sovereigns with a unique design are always going to do well (unless they increase mintages from what they usually are)

I think the Queens bast 1 oz silver proofs would have done really well if their mintage was lower, 1500, 2000, or even 3000 but with 8500 for the lion then 6000ish for the rest they're a bit too plentiful to take off price wise, at least in the near future 

 

 

Help thread for members new to silver/gold stacking/collecting

The Money Printing Myth the Fed can't and don't money print - Deflation ahead, not inflation 

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  • 2 weeks later...
2 minutes ago, NewMSmatist15 said:

Which years? I collect the business strike series, but do love the look of the proofs.

I just sold the 2001...so I only have the 1997 4 coin set and the 2017 single.

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On 3/19/2018 at 14:09, Kman said:

I think the Queens bast 1 oz silver proofs would have done really well if their mintage was lower, 1500, 2000, or even 3000 but with 8500 for the lion then 6000ish for the rest they're a bit too plentiful to take off price wise, at least in the near future

I completely agree the prices are getting way too high to chase for some.  I didn't grab the proof lion and the cheapest I can find is on ebay for $250!  I'll probably just let that one go and focus on others as they come out (more like $100 or so).  But there seems to be enough demand even at those high mintages to push the prices up (first lion then others might follow this trend up).

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