By Mark Ferguson – www.MFrarecoins.com ........
As the number of collectors who are buying up early American coins grows, these coins are becoming scarcer, forcing their prices higher over the long-term. This has been a problem that has caused many collectors to change their areas of collecting interest.
For example, a few problem-free early American “small eagle” reverse coins often cost tens of thousands of dollars each – particularly 1796 and 1797 half dollars. At $40,000 to $50,000 for problem-free Very Good condition examples of Draped Bust small eagle half dollars, those coins are impossible for most collectors to own.
Therefore, an attractive alternative for collecting early American coins is to begin by collecting the Draped Bust-Heraldic Eagle reverse design type, also known as the large eagle type. There are just five silver issues that comprise this collection – the half dime through the silver dollar. Adding two Draped Bust copper coins - the half cent and the large cent – makes a total of just seven coins. There are also only three gold coins of this era needed to complete this collection – the $2½, $5, and $10 Capped Bust to Right obverse design with Heraldic Eagle reverse. This makes up a mere ten coins to complete the full design type collection.
The half cent and the large cent should cost somewhere between $200 and $300 in tip-top Very Good condition, up to somewhere between $2,000 and $3,000 for pleasing problem-free examples of both coins in Extremely Fine condition. The total of the five silver issues in problem-free very good condition will run between $5,000 and $7,500 tops, and problem-free Extremely Fine grade examples should cost somewhere between about $15,000 and $25,000, depending on whether they’re EF-40 or EF-45 examples.
Of course the three gold coins require a more substantial budget. The grade of Fine is typically the lowest grade quoted in price guides for these coins, so this is what is quoted here. Problem-free $2½, $5 and $10 examples in the Fine grade will run somewhere between $20,000 and $30,000 for all three. Stepping these three coins up to the Extremely Fine grade will require an investment of about double that price range – actually not bad if you can afford this extra boost in quality – you’ll get much more eye-appealing coins with greater details.
Importantly, if you’re interested in appreciation potential for investment, at all costs avoid coins with problems, such as cleaning, unsightly contact marks, scratches and other blemishes. Problem-free coins will cost you premium prices to purchase, when you finally find them, but it’ll pay off when you or your heirs decide to sell.
On the other hand, if you’re not interested in investment potential and just want to own examples of each of these coins, you can get decent looking examples for much lower prices by compromising on quality, such as accepting lightly cleaned coins, for example. But, when it comes time to sell, coins with problems will be more difficult to sell and you’ll most likely have to accept discounted prices.
It may also be of help to you in buying coins graded by just one grading service. Coins graded by PCGS or NGC are the most easily marketable. Even though coins graded by other services may be accurately graded – this preferred marketability of PCGS and NGC is how the coin market has evolved. Your collection will also be more appealing to a future buyer if they’re all consistently graded. In other words, a collection of all Extremely Fine condition coins or all Very Good grade coins will be more acceptable to a buyer than a collection of coins graded in a helter-skelter range of grades.
Take your time in building a collection of early American coins – be particular! Don’t buy the first coin that comes along just to have one. Insist on waiting until you find solid coins for the grade that are problem-free. Be patient – you’ll probably spend several years building your collection this way, but you’ll be rewarded handsomely for your diligence when you sell, and you’ll be proud of your collection.
The long-term potential for a quality collection of early American coins is bright. Seasoned collectors are drawn to this area of collecting as they gain more experience. These coins are so old that a great many of them have been tampered with over the years by cleaning and other damage, even repairs.
Therefore, certification by PCGS or NGC is your best bet for protection from hidden problems and offers the best potential for resale. Additional endorsements for your coins with CAC stickers may also add value.
For more information about building a collection of early American coins or for an appraisal or selling those you may already own, feel free to email me at mark@MFrarecoins.com.
Mark Ferguson has been dealing in high-end rare coins and precious metals since 1969. He has graded coins professionally for PCGS and was the Market Analyst for Coin World’s Coin Values magazine between 2002 and 2009. He has written feature articles and regular columns for Coin World, Coin Values magazine, The Coin Dealer Newsletter, Numismatic News, The Numismatist, ANA Journal, Coin News – a British publication, and currently writes a weekly column for CoinWeek. He is a recognized authority in appraising rare coins and a recognized expert on the 1804 silver dollar, which is known as “The King of American Coins.” Mark can be reached at Mark Ferguson Rare Coins, LLC (www.MFRareCoins.com).