"Bidding in an auction from a dealer's point of view" - results 4-22-12

[MarkFeld]

I have placed approximately 150 bids, totaling slightly in excess of $380,000 in the upcoming Heritage Central States sale.

 

A couple of the coins are in the $50,000 range and others are as low as $100.

 

I had hoped to end up with a higher dollar total than that, but that's the way it goes.

 

Currently, I am high bidder on about half of the lots, and am confident that by the time the sale ends, I will be outbid on many more. My guess is that I will win in the neighborhood of 25 coins.

 

After the sale has ended, I will report back and comment briefly on the prices realized, as I see them.

[Kamillion]

goodluck sir

[Oldtrader3]

Thanks, Mark. Since you are representing customers over a wider scope and pricing structure than many of us normally are operating, it is interesting information from an analytical, data set perspective to see how successful you are and on what spreads of pricing. Knowing which series that you have higher success with bidding on is also helpful sometimes. Thanks for that.

 

Personally, I am happy to read and consider this information. It helps me maintain an open-eyed perspective on how I am doing in my open acquisiton modes.

[coinman_23885]

I have placed approximately 150 bids, totaling slightly in excess of $380,000 in the upcoming Heritage Central States sale.

 

A couple of the coins are in the $50,000 range and others are as low as $100.

 

I had hoped to end up with a higher dollar total than that, but that's the way it goes.

 

Currently, I am high bidder on about half of the lots, and am confident that by the time the sale ends, I will be outbid on many more. My guess is that I will win in the neighborhood of 25 coins.

 

After the sale has ended, I will report back and comment briefly on the prices realized, as I see them.

 

I hope you don't mind me asking this, but do you have a fixed formula for determining your bid level (i.e. X% of Grey Sheet bid, etc.) or do you evaluate each coin individually, using your professional experience to arrive at an individualized decision?

 

Good luck with your auctions.

[No+4Me]

This should be very educational. Thanks for taking the time to do this, Mark.

[MarkFeld]

I have placed approximately 150 bids, totaling slightly in excess of $380,000 in the upcoming Heritage Central States sale.

 

A couple of the coins are in the $50,000 range and others are as low as $100.

 

I had hoped to end up with a higher dollar total than that, but that's the way it goes.

 

Currently, I am high bidder on about half of the lots, and am confident that by the time the sale ends, I will be outbid on many more. My guess is that I will win in the neighborhood of 25 coins.

 

After the sale has ended, I will report back and comment briefly on the prices realized, as I see them.

 

I hope you don't mind me asking this, but do you have a fixed formula for determining your bid level (i.e. X% of Grey Sheet bid, etc.) or do you evaluate each coin individually, using your professional experience to arrive at an individualized decision?

 

Good luck with your auctions.

 

I don't mind your asking, at all, I just wont answer your question.

 

 

 

I do not use a fixed formula. My bids are based upon a combination of considerations such as what I think of each coin, my buying and selling experience (where applicable), Heritage auction archives, CDN prices, electronic trading exchange bid and ask prices and a gut feel.

 

Some coins are easy to figure bids for, while others can be quite difficult. And even if I feel strongly that the maximum value of a given coin is X, if more than one bidder really wants it, what I think becomes meaningless. In such cases, as a dealer, I frequently have to pass on coins that I don't want someone else to get their stinkin hands on.

 

[e1cnr]

Thanks for another round of this Mark.

 

Do you feel comfortable placing MAX bids with Heritage days before the auction?

 

There are a few auction houses that I place min bid on item just to mark it as I do not trust that auction house completely and it gives other underbidders time to think if they want to bump their max bid (possibly again and again) because they are not high bidder after their bid.

 

My thoughts are you need to know your max bid, but don't need to apply it until as late as possible.

[jom]

My thoughts are you need to know your max bid, but don't need to apply it until as late as possible.

 

That's what I do...I think it comes from my experience with eBay.....

 

I'm interested to see what Mark thinks/does.

 

jom

[MarkFeld]

Thanks for another round of this Mark.

 

Do you feel comfortable placing MAX bids with Heritage days before the auction?

 

There are a few auction houses that I place min bid on item just to mark it as I do not trust that auction house completely and it gives other underbidders time to think if they want to bump their max bid (possibly again and again) because they are not high bidder after their bid.

 

My thoughts are you need to know your max bid, but don't need to apply it until as late as possible.

 

You're most welcome.

 

I feel comfortable placing my bids on line, well in advance of the auction, and do so in the vast majority of cases.

 

I believe that there are advantages and disadvantages, both in bidding early and in bidding late. I prefer to bid early. It can reduce the chances of getting caught up in auction fever, and it means I need not worry about things such as computer glitches, my being unavailable at a key moment, etc. I like that peace of mind.

[bluel-migration]

There have been discussions lately about whether auction prices, given true public accessibility and ease of participation, have begun to represent retail prices. How do your clients feel about a dealer marking up a coin that they possibly could have just as easily purchased themselves? Granted, an extra bidder in the auction could lead to a higher price, but it's also possible that it was a coin you wouldn't have bid on had it not been a request, on a want list or something similar. What are your thoughts on auction prices vs retail prices?

 

Knowing you already have a willing buyer for a coin, how does that affect your aggressiveness in bidding, or do you try to always stick to your pre-planned price point?

 

Thanks!

[x2rider]

I have no problem stumping up for a coin that Mark has bought at auction .

I have learnt , the hard way , that you have to be looking at the coin in hand and when it comes to that Mark is one of the best .

 

He is pretty transperant when it comes to his coins and I can look at the auction result if I wanted to but don't .

 

Also when it comes time for resale I know the coin I have is solid for the grade to say the least

[RockMyAmadeus]

There have been discussions lately about whether auction prices, given true public accessibility and ease of participation, have begun to represent retail prices. How do your clients feel about a dealer marking up a coin that they possibly could have just as easily purchased themselves? Granted, an extra bidder in the auction could lead to a higher price, but it's also possible that it was a coin you wouldn't have bid on had it not been a request, on a want list or something similar. What are your thoughts on auction prices vs retail prices?

 

Knowing you already have a willing buyer for a coin, how does that affect your aggressiveness in bidding, or do you try to always stick to your pre-planned price point?

 

Thanks!

 

There's really no way...truly, no matter how hard an auction house may try...to completely represent an item's quality without seeing it in hand. That's why the expert eyes are being employed...people have come to trust those eyes, and are willing to pay the premium for it.

 

There will always be, in every field, until teleportation becomes reality, the need for expert eyes to examine items for clients who have neither the time, the patience, the expertise, or any combination thereof.

[mtnstyne]

Mark, how often if at all have you been left with a coin won at auction that your client backs out on?

[MarkFeld]

There have been discussions lately about whether auction prices, given true public accessibility and ease of participation, have begun to represent retail prices. How do your clients feel about a dealer marking up a coin that they possibly could have just as easily purchased themselves? Granted, an extra bidder in the auction could lead to a higher price, but it's also possible that it was a coin you wouldn't have bid on had it not been a request, on a want list or something similar. What are your thoughts on auction prices vs retail prices?

 

Knowing you already have a willing buyer for a coin, how does that affect your aggressiveness in bidding, or do you try to always stick to your pre-planned price point?

 

Thanks!

 

My clients don't seem to mind buying coins from my lists or website for (an average of) roughly 10% over the price realized at auction. In a number of cases, they would have had to pay more than that if they had bid against me.

 

If, on the other hand, they ask me to view the lots in advance and represent them, they pay me 5% commission or less. And that is only in the event that we are successful.

 

If collectors make purchases, based on images, without in-hand inspection, the odds are stacked strongly against them. And chances are that they will end up with less desirable coins, while missing out on superior examples.

 

It's no longer easy to distinguish "wholesale" from "retail" when it comes to auction results. If a dealer buys a coin, is it necessarily a "wholesale" purchase? What if the dealer outbid numerous serious collectors for the coin? On the other hand, what if a collector buys a coin out of auction, but then flips it to a dealer? Was that a "retail" or "wholesale" purchase?

 

When I know I will have a willing buyer for an auction coin, my bid is determined by one of three different means:

 

1) Some of my clients prefer to decide on their own, how much they want me to bid.

2) Some of my clients confer with me and we decide, together, what amount to bid.

3) Some of my clients ask me to determine the amount to bid. When that occurs, I still let them know, in advance, the amount I plan to bid.

 

[MarkFeld]

Mark, how often if at all have you been left with a coin won at auction that your client backs out on?

 

Fortunately, that has never happened to me. Though I realize that it could.

 

My clients are honorable.

[e1cnr]

1- Do you view all lots at the auction viewing or just those that pass initial internet scanning?

 

2- Are there certain areas/series of numistmstics that you do not feel comfortable having as inventory?

 

3- Do you follow the idea that there must be a certain amount of eye appeal to have interest to have any interest or that every thing could be a good deal at a certain price level?

 

4- I frequently have more 'interest' in lots than available money on hand - does this ever apply to you and/or do you have funds/quick access to funds to cover $400,000 in possible winnings if you get everything at max bid?

 

5- What percentage of bids are for inventory vs fill want lists?

 

6- What would you do if one of your regulars called now and asked about a coin that you have placed a bid on, and would like you to view it and give a recommendation?

 

7- What is the most expensive coin that you have ever bought at auction?

 

As always, if any of these are too personal or would give away to much about your business model, go ahead a skip them

[lehigh96]

There have been discussions lately about whether auction prices, given true public accessibility and ease of participation, have begun to represent retail prices. How do your clients feel about a dealer marking up a coin that they possibly could have just as easily purchased themselves? Granted, an extra bidder in the auction could lead to a higher price, but it's also possible that it was a coin you wouldn't have bid on had it not been a request, on a want list or something similar. What are your thoughts on auction prices vs retail prices?

 

Knowing you already have a willing buyer for a coin, how does that affect your aggressiveness in bidding, or do you try to always stick to your pre-planned price point?

 

Thanks!

 

My clients don't seem to mind buying coins from my lists or website for (an average of) roughly 10% over the price realized at auction. In a number of cases, they would have had to pay more than that if they had bid against me.

 

If, on the other hand, they ask me to view the lots in advance and represent them, they pay me 5% commission or less. And that is only in the event that we are successful.

 

If collectors make purchases, based on images, without in-hand inspection, the odds are stacked strongly against them. And chances are that they will end up with less desirable coins, while missing out on superior examples.

 

It's no longer easy to distinguish "wholesale" from "retail" when it comes to auction results. If a dealer buys a coin, is it necessarily a "wholesale" purchase? What if the dealer outbid numerous serious collectors for the coin? On the other hand, what if a collector buys a coin out of auction, but then flips it to a dealer? Was that a "retail" or "wholesale" purchase?

 

When I know I will have a willing buyer for an auction coin, my bid is determined by one of three different means:

 

1) Some of my clients prefer to decide on their own, how much they want me to bid.

2) Some of my clients confer with me and we decide, together, what amount to bid.

3) Some of my clients ask me to determine the amount to bid. When that occurs, I still let them know, in advance, the amount I plan to bid.

 

Mark,

 

This is not a personal attack, rather I am playing devil's advocate. What makes your opinion of the coin different than that of the CAC? For cheap coins under a few hundred dollars, it simply isn't worth paying a dealer a percentage to preview coins. For expensive coins, a collector has the option of having a dealer such as yourself preview the coin for them or buy CAC verified coins.

 

You stated that "if collectors make purchases, based on images, without in-hand inspection, the odds are stacked strongly against them. And chances are that they will end up with less desirable coins, while missing out on superior examples." That statement basically means that you can't confirm the grade of the coin without seeing it in hand. But if you look at the coin for me, I still haven't seen it in hand. So what you are saying is that due to incremental grading we can't simply accept the TPG assigned grade. You are also saying that incremental grading can't be discerned from high resolution photos, due mostly to the affect of luster I assume. And lastly you are saying that having a professional opinion will solve the incremental grading problem thereby ensuring that the collector will not end up with less desirable coins.

 

So my question is how is the service that you provide any different than what the CAC provides? Furthermore, keep in mind that if & when I sell a coin, telling a prospective buyer that a dealer confirmed the TPG assigned grade does not go nearly as far as the CAC sticker.

[jerseycat10]

 

Mark,

 

This is not a personal attack, rather I am playing devil's advocate. What makes your opinion of the coin different than that of the CAC? For cheap coins under a few hundred dollars, it simply isn't worth paying a dealer a percentage to preview coins.

 

 

If I was buying a $200 coin, I would gladly pay Mark 5% ($10) to evaluate a coin on my behalf.

 

The question is, where does Mark draw the line? Would he evaluate a $200 coin?

[jom]

You stated that "if collectors make purchases, based on images, without in-hand inspection, the odds are stacked strongly against them. And chances are that they will end up with less desirable coins, while missing out on superior examples." That statement basically means that you can't confirm the grade of the coin without seeing it in hand. But if you look at the coin for me, I still haven't seen it in hand. So what you are saying is that due to incremental grading we can't simply accept the TPG assigned grade. You are also saying that incremental grading can't be discerned from high resolution photos, due mostly to the affect of luster I assume. And lastly you are saying that having a professional opinion will solve the incremental grading problem thereby ensuring that the collector will not end up with less desirable coins.

 

So my question is how is the service that you provide any different than what the CAC provides? Furthermore, keep in mind that if & when I sell a coin, telling a prospective buyer that a dealer confirmed the TPG assigned grade does not go nearly as far as the CAC sticker.

 

A great question. That is the problem I have. Mark can certainly help with looking at a coin and letting me know whether it's graded properly.

 

BUT...like you said I still wouldn't have seen the coin in hand. I'm not so much interested in seeing it in hand to verify the grade. I want to see it in hand to tell whether I LIKE IT. If a coin is graded correctly and I still don't like it I'm not interested. No one other than myself can really do that....much of the time.

 

That's the main reason I have a real hard time having someone else look at a coin for me. Which is somewhat unfortunate since Mark is a very good at what he does but I can't bother him to look at a coin for me and NOT have him bid for me...since I don't really know whether I'd like it...

 

jom

[AnkurJ]

My biggest purchaes ever was a 1799 $10 in PCGS AU58 CAC. I purchaed it from Legend who bought it a week earlier from Stacks. I was bidding on the coin and kept getting outbid, and found out in a casual phone conversation with Laura, that she was the one outbidding me! I asked her what she was asking for it, and due to the circumstance, she sold it to me for 5% over her cost which was very fair in my opinion.

 

I did the math, if I bid again, it would have cost me MORE then what she sold it to me for. To top it off, I was offered more than what I paid within 6 months.

So yes while I paid a strong price, Laura did as well. The coin is very choice and its from a series that a good percentage have been played with.

 

Having a trusted dealers eyes like Mark's working for you is priceless. 5% is pennies when you consider how costly some mistakes can be when buying sight unseen.

[coinman_23885]

There have been discussions lately about whether auction prices, given true public accessibility and ease of participation, have begun to represent retail prices. How do your clients feel about a dealer marking up a coin that they possibly could have just as easily purchased themselves? Granted, an extra bidder in the auction could lead to a higher price, but it's also possible that it was a coin you wouldn't have bid on had it not been a request, on a want list or something similar. What are your thoughts on auction prices vs retail prices?

 

Knowing you already have a willing buyer for a coin, how does that affect your aggressiveness in bidding, or do you try to always stick to your pre-planned price point?

 

Thanks!

 

My clients don't seem to mind buying coins from my lists or website for (an average of) roughly 10% over the price realized at auction. In a number of cases, they would have had to pay more than that if they had bid against me.

 

If, on the other hand, they ask me to view the lots in advance and represent them, they pay me 5% commission or less. And that is only in the event that we are successful.

 

If collectors make purchases, based on images, without in-hand inspection, the odds are stacked strongly against them. And chances are that they will end up with less desirable coins, while missing out on superior examples.

 

It's no longer easy to distinguish "wholesale" from "retail" when it comes to auction results. If a dealer buys a coin, is it necessarily a "wholesale" purchase? What if the dealer outbid numerous serious collectors for the coin? On the other hand, what if a collector buys a coin out of auction, but then flips it to a dealer? Was that a "retail" or "wholesale" purchase?

 

When I know I will have a willing buyer for an auction coin, my bid is determined by one of three different means:

 

1) Some of my clients prefer to decide on their own, how much they want me to bid.

2) Some of my clients confer with me and we decide, together, what amount to bid.

3) Some of my clients ask me to determine the amount to bid. When that occurs, I still let them know, in advance, the amount I plan to bid.

 

Mark,

 

This is not a personal attack, rather I am playing devil's advocate. What makes your opinion of the coin different than that of the CAC? For cheap coins under a few hundred dollars, it simply isn't worth paying a dealer a percentage to preview coins. For expensive coins, a collector has the option of having a dealer such as yourself preview the coin for them or buy CAC verified coins.

 

You stated that "if collectors make purchases, based on images, without in-hand inspection, the odds are stacked strongly against them. And chances are that they will end up with less desirable coins, while missing out on superior examples." That statement basically means that you can't confirm the grade of the coin without seeing it in hand. But if you look at the coin for me, I still haven't seen it in hand. So what you are saying is that due to incremental grading we can't simply accept the TPG assigned grade. You are also saying that incremental grading can't be discerned from high resolution photos, due mostly to the affect of luster I assume. And lastly you are saying that having a professional opinion will solve the incremental grading problem thereby ensuring that the collector will not end up with less desirable coins.

 

So my question is how is the service that you provide any different than what the CAC provides? Furthermore, keep in mind that if & when I sell a coin, telling a prospective buyer that a dealer confirmed the TPG assigned grade does not go nearly as far as the CAC sticker.

 

There are a number of great coins that have never made the trip to New Jersey, and may not ever go their because of their owners/consignors. In short, CAC offers a similar service, but you cannot withdraw someone's coin from the auction to submit it. Mr. Feld, on the other hand, is able to make the same/comparable determination. Also, he apparently provides price estimates, etc., which CAC does not (and CAC bid prices are the same regardless of eye appeal and technical attributes - in short, CAC treats all beans alike although the market most likely will not.)

[leeg]

As relationships with a dealer develop over the years they will learn to know what you like and don't like in a coin. This relationship can not be developed unless there is some buying, selling and possibly trading involved with a dealer. It takes a leap of faith by most of us. I will say I have never been disappointed in a coin that I purchased from Mark or one that he viewed in Auction for me. He has told me on more than one occasion, "don't buy it or it's not for you," even though I thought it was a nice coin.

[AnkurJ]

FYI, the majority of coins sold at heritage, stacks and Ira & Larry Goldberg have been to CAC.

[MarkFeld]

Thanks for the comments and questions.

 

When I get back from the Central States show and have caught up on my work, I will make an effort to address the as-yet, unanswered questions.

[Oldtrader3]

FYI, the majority of coins sold at heritage, stacks and Ira & Larry Goldberg have been to CAC.

 

As of before the merger on January 1, 2011 that was not the case with Stack's. I bought several auction and stock coins from Stack's in 2010 and none were CAC approved.

[e1cnr]

FYI, the majority of coins sold at heritage, stacks and Ira & Larry Goldberg have been to CAC.

 

As of before the merger on January 1, 2011 that was not the case with Stack's. I bought several auction and stock coins from Stack's in 2010 and none were CAC approved.

 

maybe he is implying they were submitted and if they do not have it, they did not meet standards - just a guess

[MarkFeld]

FYI, the majority of coins sold at heritage, stacks and Ira & Larry Goldberg have been to CAC.

 

How did you come up with that? Not counting duplicates, Heritage, alone, has sold more than 1.4 million coins, according to their archives. Has CAC evaluated more than 700,000 coins?

 

[coinman_23885]

FYI, the majority of coins sold at heritage, stacks and Ira & Larry Goldberg have been to CAC.

 

How did you come up with that? Not counting duplicates, Heritage, alone, has sold more than 1.4 million coins, according to their archives. Has CAC evaluated more than 700,000 coins?

 

But the archives include coins sales prior to 2007 when CAC opened. Also, some coins are sold multiple times there.

[coinman_23885]

FYI, the majority of coins sold at heritage, stacks and Ira & Larry Goldberg have been to CAC.

 

How did you come up with that? Not counting duplicates, Heritage, alone, has sold more than 1.4 million coins, according to their archives. Has CAC evaluated more than 700,000 coins?

 

Also, I figured out where you came up with your 1.4 million coin estimate; it is noteworthy that this includes ancients and world coins which CAC does not verify. It also includes moderns (like Roosevelt dimes, Eisenhower Dollars, etc.).

[MarkFeld]

FYI, the majority of coins sold at heritage, stacks and Ira & Larry Goldberg have been to CAC.

 

How did you come up with that? Not counting duplicates, Heritage, alone, has sold more than 1.4 million coins, according to their archives. Has CAC evaluated more than 700,000 coins?

 

Also, I figured out where you came up with your 1.4 million coin estimate; it is noteworthy that this includes ancients and world coins which CAC does not verify. It also includes moderns (like Roosevelt dimes, Eisenhower Dollars, etc.).

 

I meant to write "counting duplicates", as opposed to "not counting duplicates".

 

Still, your above information, notwithstanding, I believe that the original statement ("the majority of coins sold at heritage, stacks and Ira & Larry Goldberg have been to CAC") is incorrect.