Year Winds Down On Hot Streak

Posted on 12/12/2007

With the economy facing an insecure future, properly graded numismatic coins can help offset the dwindling value of the dollar and lead most venues in protecting your assets.

A guest article from NumisMedia

Looking at the value of the U.S. Dollar, the price of oil, the housing market, along with several other obvious indicators, it is likely that the bullion market will continue a path toward higher levels. Even if it does not move drastically higher as many analysts predict, the coin market should continue to lead most venues for the protection of your assets. With the economy facing a very insecure future, properly graded numismatic coins is the place to offset some of the dwindling value of the dollar.

This is not the early 1980's, there is no frenzy yet, but astute buyers are looking for specific rare coins to add to their holdings for future benefit. Over the past year we have brought to your attention many areas of numismatics that appear to be very solid potential acquisitions for the long term collector. Many of these series continue to be of utmost importance to market makers and their collector clients. The problem dealers are facing is not whether their clients are convinced to buy many of these early issues, it is locating enough of these coins to satisfy the current demand. When you look around the country and see the many thousands of collectors looking for the same type of coins, quality coins with potential, it becomes obvious that not everyone can acquire all the coins they want at current levels. Based on today's demand, the FMV is sure to rise over the next year because supplies are not near enough to make a dent in the millions of dollars waiting to be spent on truly rare coins.

The reason dealers feel the market for true rarities will continue to move higher is a matter of recent history. This past year we have seen the FMV rise substantially on hundreds, maybe thousands of early rarities, but successful buyers are a small percentage of those actually pursuing these coins. Since the beginning of the year we have seen the FMV advance for Early Gold ($2 1/2, $5, & $10) at a rate of between 10% to 30% depending on the specific date and grade of the issue. Below is a list of dates and how much they have advanced since the January 2007 Price Guide.

DateGradeJanuary FMVDecember FMV
$2 ½ Gold
1796 No StarsAU50$90,630$115,630
1796 No StarsMS60$190,630$220,630
$5 Gold
1795 HeraldicAU50$45,630$56,250
1797 15 StarsAU50$65,630$85,630
$10 Gold
1795 9 LeavesAU50$116,880$137,500
1795 13 LeavesMS63$260,000$303,550
1797 HeraldicMS62$78,000$92,950

What is very interesting about this area of the market is dealers tell us they could sell every coin they could get a hold of at current FMV levels. The obstacle is that potential sellers usually want about 20% more than the listed FMV for most of these coins.

Bust Half Dollars remain a high priority with dealers and collectors. Keep in mind, they want nice original coins with no distracting marks; toning is okay as long as it is attractive toning. Dark or ugly toning may bring hefty discounts of the current FMV. However, super eye appeal coins will command premiums in auctions and the competition is quite fierce. Since the beginning of the year the common Type coins have moved dramatically in nearly all grades. The following is a list of grades and the current FMV compared to the first of the year.

Bust HalvesJanuary FMVDecember FMV

Comparing the Reeded Edge Halves we see even more inspiring results. The MS60 was $840 and now it has an FMV of $1,140; the MS63 was $2,090 against a current FMV of $2,530; the MS64 was $4,810 and has moved to a higher $5,590 FMV. The MS65 climbed over $2,000 in less than a year and now stands at $13,310.

Just about every series in the Classic era prior to 1900 has a multitude of issues with FMV advances that can challenge these immense statistics. It is for the individual collector to study and compare their favorite issues. In addition, it is quite important to research the number of coins that NGC and PCGS have certified in each grade to help determine where potential lies. One of the more exciting areas of today's market can be found in Morgan Dollars. The advanced collector may develop a love for Deep Mirror Proof Likes and the higher the grade the tougher the search for coins that make the grade. Not only do the coins have to qualify with a numerical grade, they also have to have the look that matches other coins within the collector's set. There may be five coins certified in a specific grade but the added characteristics can be even more important than such grade. The contrast, the depth of the mirror, the eye appeal, and specific marks that detract from eye appeal help in the final selection process. This is definitely an area where the expression, "not all coins are identical" hits the very heart of collecting.

Several of the high grade Deep Mirror Proof Like Morgan Dollars have advanced markedly since the first of the year. The 1878 S in MS66 had an FMV of $19,060 in January and now rests at an incredible $24,810. This is a fairly common date in Mint State but obviously quite rare in DMPL MS65 and higher. The 1880 is also very tough in MS66; it has increased from $25,000 to a current $29,380. Even some of the rare date issues have jumped substantially since the first of the year. The 1889 S in MS66 was $34,380, but has moved to $43,130. Due to a very low census for most of the true rarities in the highest grades, these coins may set new record prices every time they are offered in a major auction. Buyers know they have to be very aggressive in order to be the next owner of these gems.

Seated and Trade Dollars have also been in strong demand over the past year. Nearly every grade has increased and the demand continues for most dates. Based on current market conditions the outlook for 2008 should be as good as or better than this year. We would like to take this opportunity to wish all of you best wishes for a happy holiday season and a healthy new year.

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.

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