by Geoffrey Cope - www.petitioncrown.com .......
Coins as an alternative Asset Class
Rare Quality Coins which has quietly been held by collector/investors offer another alternative safe-haven asset class and diversification for future protection against inflation.
What are our priorities in deciding an Asset Class, preservation of capital, increase in capital, a product that has a known performance, a stable area, a diversification from regular Asset Classes such as Stocks, Shares, Bonds. Property etc. Rare Coins is such a class.
Sestertius BRASS 37-41, Æ AGRIPPINA M F MAT C CAESARIS AVGVSTI
A coin of incredible detail & condition with a portrait that launched a "love" to acquire the coin. Very few coins of this period exist in such a natural condition.
Quality coins and medallions are rarities and are sought after a credible alternative asset class with a record dating back 100’s of years.
Calculated investment returns show an increase over different periods, I decided that figures be explained by individual advisers.
Rare coins and medallions is a tangible safe-haven. We look for diversity to our portfolio as well as a matrix that gives us the possibilities to protect wealth and counter inflation will be part of the future.
Turbulent world economy
The turbulent world economy has created an increased number of questions, not least is whether the capitalist world as we know it changed forever from 2008? Will individuals have to take a greater responsibility in their future planning in investments? How will, or could alternative investments such as coins play a part in the future of an overall planning matrix to pay for our children’s future education or pension funding? Will the retirement age need to be increased to 70 or 72? Will company dividends and capital growth support the growing numbers of regular savers for their later retirement? How will banking changes alter the banks responsibility and perspective to its clients?
New Collectors and Investors first buy a book on “coin collecting” and begin to understand what has made collecting coins the hobby of Kings, Princes, Emperors, Arch Bishops to name a few over two thousand years of history. Coins are history; they date history and started over 2500 years ago.
What will be the effect of sovereign debt in the future? Remember for as long as coins have been minted, gold has been the only metal to measure value. Ask yourself, if governments print 4%-8% more paper yearly what your money is valued at in one generation. This is serious, see www.measuringworth.com/ you will be shocked.
There is a greater understanding that gold, not hammered or milled numismatic items, but bullion (not paper gold but physical) can play a part of a person’s asset distribution.
Anything written here is a private view of the future and not investment advice that can be better filled by the expert in these fields.
2013/2014 British Coin Market
The British Coin market each year asks what is supporting the market, die hard collectors or investors. As prices have over the years increased and occasionally decreased there is a merging of collectors/investors consideration when buying. Quality, Quality/Rarity, Rarity because of the Quality is creating a new unwritten price list. 2012 market are ‘dry’ it requires old collections to come to the market; the present demand for quality outstrips supply. Recently on trawling the internet I came across what can be described as a Superb Quality / GEF/UNC, MS64 William and Mary 1689 2/6 from a US dealer an indication of prices from the Standard Catalogue in EF price the coin at 1,600 gbp. This coin is priced at 7,000 gbp. My view from collecting over a long period is that art & quality will always demand individuals to require the finest. This piece is a ‘talking piece’ for any collection. Quality coins are definitive they are today and have always been. Consider a market that as discussed above is becoming an asset class.
When researching coin investment I quickly learned that many wealthy young men start as investors and quickly become collectors so we have a lack of material that was acquired as investment material to re-cycle in the market.
Everything connected to coin collecting or shall we say ‘money’ seems to attract so many collectors that the market seems at present to have no ending of demand for quality and supported by what is in vogue at a period of time, well money has been around a long time.
British coins have so many interesting areas there are always a number of areas that give new opportunities for collectors or investors to acquire pieces. 2013 will be no different. Celtic, Stycas, Half-groats , and in milled coinage have a look at halfpennies or the Soho Mint Proofs and Patterns, all of which could be ready for a substantial increase.
Let us KISS (keep it super simple). We need to take into account a known number of factors that exist today:
- The continuing growth of the internet as a knowledge source and sales medium
- The US market having a greater interest in British coins because of connection and opportunity
- The migration of collectors to finer quality pieces. Coins are works of art and there are a growing number of collectors who have realized and appreciate the growing market for coins as art form.
- British coins create a wide opportunity for collectors from Celtic to Elizabeth II
- British Rare Stamp collectors are developing a love for coins.
This is enough for us to realize that our once quiet hobby is becoming more and more blurred as a hobby with the concerns of wealth protection.
Pictures speak 1000 words.
1 Charles I Crown mm Bell
2 Edward VI Half Crown
3 Charles I Shilling mm Lis
4 Elizabeth I Pledge Penny
5 James I Ship Ryal
6 Charles II Unite
7 Charles I Oxford Triple Unite
8 Charles I Carlisle Siege 3 shillings