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The Best Strategies To Use When Investing In Coins |
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The best strategies for investing in rare coins are timeless and will never change. These can be governed by five primary rules.
They are:
- To buy the highest quality and most rare coin that you can afford. The rarest coins always appreciate the most and the same is to be said for the highest quality coins.
Consider one of the "Single 9" owners, our nation's rarest coin, when Mr., Jan Kraay purchased this for the record price of R132 000.00. The "Single 9" has a mintage of 1, it is unique, it is unusual and it is virtually priceless. These statements are all facts. When you as a buyer are confronted by so many facts a decision is made a great deal easier. Nevertheless, when Mr. Jan Kraay received his multi-million rand cheque for the "Single 9" he must have been in the clouds, especially when you calculate the rate of return, the "Single 9" has averaged 81% per annum. The coins that are rated "Unique" always take the headlines as they are setting price records again and again. They will continue to do so.
- Make sure that your coins are interrelated or part of a series of coins from which a set can be completed. Forming a complete set of a particular series of rare coins can be a difficult task to accomplish for invariably there are what is referred to in numismatics as "Stoppers", these are coins that are so rare that they can prevent the completion of a complete series of coins.
An example of a stopper is the 1898/1899 overstamp Pond. This coin is so rare in any condition that it is generally not found in most collections. When forming or collecting a complete set of Pond coins from the period of the Z.A.R. this coin is the second last coin of the series. Complete collections have, due to the stoppers that they contain, been sold for vast premiums above the value of a compete series of coins, were you to value each and every coin individually.
There are several different types of sets that you can accumulate. There are date sets which is one example of each coin that was produced in a particular series i.e. one Z.A.R. Pond for each year that was minted. This would mean that your set would comprise of the following Ponds: 1892 Double Shaft, 1892 Single Shaft, 1893, 1894 - 1898, "99 Over Stamp" (Stopper) and a 1900.
Another type of set that you can form is a "Type Set". This would be one of each of the different types of pond that were produced by the Z.A.R. With a type set in order for a coin to qualify there must be a change in the design of the coin, a change in date is not applicable. A type set of regular Z.A.R. Ponds would consist of only two coins as each of them are from a design aspect different from one another, they are the 1892 Double Shaft and the 1892 Single Shaft Pond. The sets that always attract the greatest premiums are the date sets as these are the most difficult sets to complete.
- Make sure that you are buying rare coins. Many coins are sold as rare when they are in fact production coins which cannot ever become rare coins. The easiest way in which to determine whether a coin is rare or not is to see if the coin at the time of its minting was part of readily used currency. Feel free to contact us anytime if clarity on this issue is required.
- Buy coins which have been certified by an independent company. The value of coins is determined by their grades or quality. The quality or grade of a coin can only be accepted if the company is recognized by numismatic organizations around the world.
There are only two companies in the world that are recognized as being reputable and accepted graders of coins. They are NGC (Numismatic Guarantee Corporation of America) or PCGS (Professional Coin Grading Services). Make sure that any coin that you have is graded by one of these two companies.
- Read as much material on South African rare coins as possible. The better you understand the industry the more educated and astute your decisions will be. At this time there are not any recent books on the subject that we can refer to. Whilst several books have been written on the subject they are not freely available and can usually be found at second-hand bookstores.
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