Rare coin collecting is an in vogue hobby in the United States, with many collecting the gems for fun, while others are investing in rare coins for pure profit. Many investors believe all portfolios should hold a hefty portion of both bullion and rare coins to protect paper investments such as stocks and bonds. Gold and silver bullion coins can be used as a hedge against high inflation and a down economy. On the other hand, rare coins appreciate in value over the course of time making them a sound alternative investment to risky stocks.
According to cbsinvestment.com the idea of rare coin investing is really quite simple. When something is rare it is likely to increase in value as it ages. There is logic to this statement because the rare coin market is strong and demand is on the rise. While all investments come with risk, considering that the rare coins supply is low and finite with growing demand does suggest prices will rise, especially when it comes to high end rare coins.
The most common way to invest in coins is to buy bullion coins. While these coins offer a good safe haven against a troubled economy they are typically not bought to gain profits. Rather they act like an insurance policy against risk laden stocks. On the other hand, high end rare coins do appreciate in value over time and can be sold for high financial gain and gives any investment portfolio a boost.
Ftasset.com says that one needs to know the why they are collecting rare coins. If it is for financial gain you buy and sell with this perspective in mind, while a collector might hesitate to sell his prized coin in spite of high profit potential. The worth of rare coins is determined by how rare it is, coin grade, and collector market demand. Knowing the ins and outs of the market before entering into rare coin collecting is strongly advised for a favorable outcome.
There are plenty of coin collectors that actively hunt rare coins on a daily basis. These ultra-high end coins are coveted and those who sell them stand to gain financially. Of course, this is not to say that middle of the road rare coins will not garner profits, they can if coin grade and demand warrants it. Coins with an interesting backstory often sell at a higher price than coins without a compelling history. Keeping up to date on rare coin trends is the best way to maximize profits.
The current stock market is indeed sailing high and has been setting records lately. However, some investors are concerned that the market is nothing more than an optical illusion and could come crashing down at any time. As an investor placing all of your eggs into a single basket is not a prudent move. Of course, we all remember the financial market crash of 2008. Yet, rare coins have been a remarkably stable investment over the last 20 years. Plus, the precious metal content contained within rare coins does offer hedge protection. Investing in gold and silver bullion coins helps to diversify paper heavy portfolios even more. You really cannot protect your paper assets enough.
In conclusion, rare coins have sold for thousands of dollars at coin shows and auctions. Simply investing in stocks is not a wise move, because eventually the stock market will come back down to reality. Rare coins offer a wonderful way to increase wealth, because rare coins tend to increase in value over the course of times. Isn’t it time you gave your portfolio a boost with rare coins?