Just like any other purchase, you'll want to do your homework before buying numismatic coins, silver bullion, and gold bullion. It takes some time to master the art of collecting coins. The coin and bullion markets are as broad as any other industry in the world. There's literally an item for everyone regardless of budget or interest. You can purchase silver eagles for a few dollars over spot price or spend millions of dollars for a single piece. Much like artwork, coins tell a story about who created them, why they were created, and what was occurring during a specific period of time. Even after 22 years of buying and selling coins, I continue to learn and am surprised regularly by the coins that come to market. For beginners and avid collectors alike, here is some basic information and tips before you make that next or first purchase.
1. Raw or Graded
The first thing to consider is whether you want to purchase the coin raw or graded. A raw coin is simply a coin purchased that is not graded in a sonically sealed holder by a third-party grading service. All coins that are purchased directly from the world mints, including the U.S. Mint, are raw coins. They are generally the least expensive way to purchase coins. The only issue with purchasing coins this way is that you will never know the true condition of what you have unless you submit the coins to a grading service. Also, these coins typically are only worth their weight in gold, silver, or whatever their composition. It is a HUGE misnomer that coins purchased directly from the world mints are in perfect condition. This is simply false - the mints around the world, including the U.S. Mint, only guarantee their coins to be uncirculated. This means that they would fall somewhere between 60-70 on the grading scale
with only the 70 condition being absolute perfection. Graded coins are coins that are submitted to third-party grading services, like PCGS
, verified and graded on a scale from 1-70, and sonically sealed in a tamper-proof holder with serial number. (click here
to learn more about raw vs graded coins)
2. Where To Purchase
The second thing that needs consideration is where to purchase the coins. If you are considering raw/ungraded coins, it is best and least expensive to go to the source and purchase them directly from the mints that produce them. Please note though that the U.S. Mint does not allow the general public to purchase some bullion products directly and instead they distribute the coins through a network of official distributors called "authorized dealers" who, in turn, create a two-way market buying and selling to precious metal wholesalers. If you are looking for graded/numismatic coins or a combination of raw and graded, then it may be best to purchase from a private company. Global Coin for instance has different programs where clients can play on both sides of the market. Many prefer a package deal where they get graded and raw coins. Always look for companies that are reputable and have lots of experience and a physical location. The best way to see if they are reputable is to check their customer reviews, Google reviews, Facebook reviews, their grade with the Better Business Bureau, and ratings with companies like TrustPilot which give companies a grade and verify all reviews.
For reference, as of writing this review, Global Coin scores:
3. Plan Your Collection
Third, decide on a plan for what you want to start collecting. The U.S. Mint has been making "modern issue" silver and gold eagles since 1986 and has been producing coinage since 1787. The possibilities are endless on where to start. Some customers are looking for colonial coins, some for modern gold, and others for U.S. Mint error/mistake coins. Most collectors start with something simple, easily traded, and easily recognized, like the silver eagle, gold eagle, or 24-karat gold buffalo. Many collectors work to complete full sets of a specific coin or series. For instance, Morgan silver dollars were minted from 1878-1921, and many collectors will try to get one coin from each year. Others will try to get one coin from each mint that produced them. The Morgan dollar, for instance, was produced in five different mints. Each coin has a different "mint mark" so you know which mint produced the coin. For example, coins minted in San Francisco have an "S," coins minted in Denver have a "D," and New Orleans coinage has an "O."
Factors To Consider
Remember, whatever you decide to collect, the value of the coin is determined by many factors: (in no particular order)
- How many were minted
- The grade of the coin on the Sheldon Scale (1-70, with 70 being absolute perfection)
- How many coins are found in that particular grade (known as the coin's population)
- The supply and demand of that coin or series (gold eagles, silver eagles, and buffalos are heavily traded)
- Mint mark of the coin (where it was produced) Some mint marks are very rare as the mintage number could be a fraction of the amount minted at another location
- The year the coin was produced
- Does the coin have a special status (ie: Advanced Release, First Day of Issue, etc)
- Is the coin autographed by an important person in the coin world? A baseball can be purchased anywhere for around $5, but a Babe Ruth autographed baseball auctioned for $388,375!
There are many great opportunities and options to choose from in the coin and bullion industry. Some buy for the beauty and appeal of the coin, while others buy for the collectible value to pass on to their children and grandchildren. Some purchase for the rarity and incredible story of a particular piece. I've held biblical pieces like the Shekel of Tyre and widow's mite, awed over shipwreck coins recovered from thousands of feet under the ocean, held a coin made from over four pounds of pure 24kt gold coin, and even sold coins where only one of that coin exists in the world. If you ever have questions or need advice, we're only a phone call away. Happy hunting!