NumisMedia Market Report: Bargain Hunters Competing with Continued Optimism

We all know that the coin market runs in cycles. The past couple of years, the overall market has been lower than the previous five years. Although, if you survey a group of major dealers across the country, some of them will tell you that the last two years have been the best in their business history. Coin cycles are much different today than they were twenty years ago. In the 1980s and 90s, when the coin market went south, most dealers had trouble selling coins, any coins. Some series were impossible to sell because we did not have the depth of buyers we have today. When minus signs showed up in a particular series, every potential buyer knew the market was soft and would just sit on the sidelines until support was justified. Today, waiting for the pendulum to swing upward can be a detriment. Hesitate and a potential bargain could be snatched up by the next astute buyer. And once the market begins to heat up, there are no more bargains.

In today’s market there are many collectors and investors chasing coins in every series; most will sell at some percentage of FMV. If it is a hot series, coins will bring current levels. If it is hot and rare, the coins will probably bring premiums. However, if a series is soft, it may take discounts to sell these particular coins. In the past year we have seen Buffalo Nickels, Mercury Dimes and Walking Liberty Half Dollars falter. At times it was difficult to sell some dates because of the overabundance of supplies on the market. Yet they did sell when the price was discounted enough to entice the bargain hunters. The result has been expectedly lower FMV prices. The amazing number of buyers in today’s market creates an enigmatic situation whereby there are always dealers to purchase your coins if the need arises. There is a tremendous flow of coins in and out of dealer inventories so there are a number of buyers for most coins. In the last few years, buyers have purchased coins even if the market for specific coins was down. It is much like the stock market mentality: you buy coins and, if they go down, you buy more so you can average your overall cost at a lower level.

Even though prices for the previously mentioned soft series have fallen, there are many coins within these series still being traded. Compared to July 2008, many collectors have paid 20–30% less for Buffalo Nickels, Mercury Dimes and Walking Liberty Half Dollars. A complete set of Buffalo Nickels in MS 64 back in July of 2008 had a listed FMV of $528,840; today the FMV is $436,276. In Mercury Dimes, the MS 65 Full Bands set had an FMV of $353,589 in July 2008 versus today’s FMV of $310,949. The MS 65 Walker set was valued at $547,714 FMV, while today the FMV is $509,041. These statistics drive many advanced numismatists toward future purchasing decisions. Will these sets get any lower in the next year or are they ready for advances? You can be certain that these are not the only series to watch.

Buyers for Silver Commemoratives have abandoned this series for several years. However, recently they have been on many watch lists and, in fact, are selling with no trouble around FMV levels. Some sales are still at discounts but the fact is these coins are selling better than they had been for a very long time. The following chart shows the FMV for various dates in MS 65 for April 2007 against the FMV of the current month.

The total cost of the above listed Silver Commemoratives back in 2007 would have been valued at $36,985. Buying these coins in today’s market, your cost may be close to the current FMV of $24,721, a saving of $12,264 from prices just two years ago. More importantly, there are still bargains out there. Some dealers have had extensive inventories of Silver Commems for a long time and are more than willing to deal them so they can free up cash for new inventory. However, there are several dealers in the Silver Commemorative market at this time and their buy prices are very aggressive for specific dates and quality.

This past month has been a wild ride for the metals. Gold shot up to over $1,240 and the premiums for US Gold coins have advanced as well. There is a long list of increases throughout the Gold charts. For example, common $20 Saints jumped to $1,800 FMV this month from the May FMV of $1,630. Gold was $1,180 in early May when these prices were printed and now it is $1,210. As you can see, Gold increased $30 while the MS 60 leaped up $170. The MS 63 was $1,800 in the May Monthly Price Guide and now it is a whopping $2,070. Many other Gold coins have shown the same kinds of advances of late.

This article is a guest article written by:

The thoughts and opinions in the piece are those of their author and are not necessarily the thoughts of the Certified Collectibles Group.