Making the Best Choices When Investing in Rare Coins

If you’re interested in diversifying your investment portfolio with some tangible assets, investing in rare coins is a really great bet. You have to be careful, though, when choosing which coins to invest in. The best bet is to find coins that had a limited minting run and which are made of a precious metal, like gold or silver.

Bullion coins, made of a specific precious metal like gold or silver, will never decrease in value below the market value of the metal they’re made of. A coin made from an ounce of gold may only be a twenty-cent piece, but its actual worth in bullion will be in the thousands thanks to the value of its metal.

On the other hand, a coin may be worth more than its original worth if it is in good condition and was only made for a limited time, a long time ago. Coins like this will increase in value to collectors, as they are no longer in production and have value due to their rarity and their condition. This value is called their numismatic value, and it may increase beyond the value of the metal that the coin is struck from if collectors find value in it. That’s why investing in rare coins that have both bullion and numismatic value is such a good idea.

Worth Its Weight in Gold
If you’re investing in gold bullion coins, size matters, especially if the coins you’re investing in aren’t in perfect condition. As we said before, a bullion coin will always be worth as much as its weight in material. Buying a larger bulk, in this case, usually proves to be more valuable to you in the long run. This is especially true right now, as gold has been fairly flat on the market in 2013, but is expected to pick up a great deal in 2014. If you can invest in rare coins that make up a large amount of gold, you could turn a profit within the coming year.

Because coins are a tangible asset, and precious metals are easily sold, investing in rare coins is a good idea if you predict that you’ll have need of liquid funds for future investments. Coins are easily liquidated, making your investment very easily accessible.

Not Just Any Coins
Though gold coins are always a good investment for their bullion, you can make a better investment if you’re choosy with your purchase. Just because a coin is old, that doesn’t necessarily mean that it’s worth more money. Do some research and compare prices on different coin mints and vintages. Some coins appreciate more with age, while some stay stagnant.

Most important, in investing in rare coins, you must make sure that you don’t pay too much for an over-graded coin. The grading system of rare coins has been standardized, ranging from one to seventy, one being almost totally degraded and seventy being perfect condition. A little bit of research and some advice from coin experts should be sufficient to ensure that you don’t overpay for a lower grade coin.

Getting a higher grade coin that will appreciate in numismatic value will ensure that you get the most value for your money and that your net worth increases as much as possible. Why would you settle for the price of your coin’s weight in gold when you could invest in a coin that will appreciate far beyond that worth? It’s not unheard of to see a coin collection’s value increase from the thousands to the millions in just twenty or thirty years. Imagine what that kind of investment could do for you and your portfolio.

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