With the entire world buzzing with discussions about a certain” virtual coin”, it can be easy to overlook a more reliable form of investment – rare coins. They have long been a source of stability in a portfolio. They have always had a lot of “pros” and almost no “cons”, and this is why collecting rare coins still makes a lot of sense in 2014.
The Basics of Collecting Rare Coins
How is that rare coins come with so many benefits? There are a few things to always keep in mind about them.
- They are “rare” – The use of the word rare means that they are not being made any longer, are not widely available, and are very hard to find in collectible condition. This alone makes something more valuable, and is one of the primary reasons that collecting rare coins just makes sense. When you own something that many others want, and that “something” exists only in low numbers, it is only going to increase in value over time. This adds tremendous value to a portfolio.
- They have three types of value – There are many investment vehicles that have only one or two forms of value. These most often include the extrinsic value or the value that comes from an outside source and the intrinsic value which is the value of the actual material from which something is made (gold coins, as an example, have a high intrinsic value). When collecting rare coins, however, your investment has a third value that comes from the scarcity of the coins.
- Their scarcity rarely comes to an end – Unlike new coins, rare coins remain limited in number forever. This ensures that they hold their initial value and only increase over time. The scarcity also takes on another sort of value in the modern markets in which traditional investment vehicles are so unreliable, and which makes scarcity a very solid investment consideration.
With so many benefits, it is a wise idea to get started making plans to invest in rare coins, but as you do, be sure you understand your goals, budget, and what is feasible in terms of your options.
The Challenges of Collecting Rare Coins
Though one of the “pros” of collecting rare coins is the fact that they are rare and scarce, it can also be a bit of a “con” or downside as it means that there can be steep competition for them. Whenever there is a higher demand for an item in limited supply, it creates a bit of an artificial price increase that may be more of a bubble.
Just like any investment vehicle, however, when collecting rare coins it just makes sense to watch the market. This is best done by using one of the coin collector’s strongest resources – the coin expert or licensed dealer.
It is impossible for the layperson to properly gauge a coin to its most accurate value. However, when you form an alliance with a few reputable coin dealers (all of whom should supply you with only certified coins), you are going to be able to implement your plans effectively.
The coin dealers will be able to review your plans with you and advise you towards specific coins, and even caution you away from certain coins that may be “hot” at the moment and experiencing a temporary surge in prices.
No matter what types of rare coins you choose to collect, they are a very savvy and stable form of investment. This is something of tremendous significance in the coming years. As markets recover, coins can serve as a very reliable way to protect and grow wealth.