Are mint products a bad investment?

Consider in 1936 a proof set issued for $1.89, and retails for $7,500 today.

A proof set in 1956 issued for $2.10 and is worth $50 today.

But, after the 60's, the issuing price and current value are different. Many proof sets are now worth less than the issue price, which means you lost money.

The 1994-S proof set issued for $12.50 and is only worth about $5.00 today. The '94 set is 20 years old.

Even another 10 years from now, it's doubtful the price will give a return over the issue price.

There are tons of mint products worth less than issue price, but tons more worth MORE, but usually only because the price of gold and silver rose since they were issued.

However, better returns are often given buying non-mint gold and silver because mint products usually have higher premiums.

We look at a new mint product, the HOF series.

The 2014 $5 Gold Unc coin issues for $419.75, and has about $318 worth of gold in it.

This means theoretically, you have taken a 100 dollar loss against the spot price, which may rise or fall, no one really knows.

But...if gold went to $2000 an ounce, your coin would be worth $493, so you would make money.

So it makes one wonder if people purchase mint products to speculate the value?

If I was 40 in 1994 and purchased 100 1994-S proof sets, I would of spent $12,500, and my investment would only be worth about $5,000 today. I would be 60 years old with no return over 20 years.

If I was 20 in 1956 and purchased 100 proof sets, I would of spent $210, and my investment would be worth $5,000 today.

If I was 20 in 1956 and simply saved 210 silver dollars, my investment would be worth around $3100.

I would be 80 years old today, and made a really good return.

Of course, none of us have a crystal ball, nor we can predict the future.

So here is my question, are mint products a bad investment?

 

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If you're a collector, you're not in this for money. I've been doing it for many years as a hobby and only averaged about 3% ROI based on a reasonable resale value (ebay completed sales with a subtraction for marketing fees). If you're a dealer, you can make money if you work hard, buy low, sell higher, keep emotions out of it, keep good accounting, and time correctly. I don't think that you can make money selling coins and bullion unless you work a lot of hours, study hard, and make the right contacts. Of course, I'm not doing it for a business and never sell my precious babies. Thus, my opinion has little merit.

 

Depends upon which century you started collecting them. Modern mint products offer little or no return except for a few so called key issues, and even those might fall in value in the future. Generally speaking you can't invest in these and hope for a walloping return. Any return from my collection surely won't be achieved in my lifetime and quite possibly, my children's lifetime. My grandchildren might benefit, though that's entirely dependent upon my offspring not cashing the caboodle in right away upon my demise.......

 

Haven't we been through this before?

 

Many are. But I am a collector and I don't speculate. Still, I make it a point to pick up extras of what I know will do well.

 

Yes.

 

Timmy, you would HAVE been...

How many time do you have to be told?

 

Overall, they are not good investments. However, some recent issues (in the past decade) have been winners. Here are just a few examples:

2009 $20 UHR gold eagle
2008 fractional gold buffalo
2012 Hawaii 5oz ATB silver puck
2012 silver proof set
2011 ASE 25th anniversary set

Regarding the HOF $5 gold you mentioned. I could sell mine for between $800-$900 on eBay right now. Sometimes spot PM does not play a huge role if numismatic premium is strong. TC

 

I paid $425 for each of my Proof gold HOF, paid $30 each for grading and sold them all for $1100 each. Yes, modern mint issues can be profitable.

 

The only coins I ever purchased for a possible investment return were the 2011 set of five ASEs. I was fortunate to be able to purchase the maximum of five sets and at one time, thought about selling four of the sets. I have never done so. I doubled my money and then some in literally a couple of months, but since that time, the price of the set is essentially flat in the $600-$700 range per set. Not bad for a $299 initial price. Nonetheless, I have decided to keep my five sets intact in their original government packaging.

 

My biggest scores have been mint products: 2011 ASE set and 2012 LE silver proof sets. In each case, I nearly tripled my purchase price. Otherwise, my best profits have been from buying Liberty head fives for BU money and getting them into MS 63 and MS 64 slabs. For those, it helped to have a good relationship with a dealer who gave me first shot with fresh collections that come through the door.

 

It's all on what the dollar is trading for, $2.10 in 1956 is worth $50.00 now, collect what you enjoy I've not paid to much interest on the investment side.

 

US Mint products are a peculiar animal and the application of values for a 1936 Proof Set is totally out of line with reality since you might as well compare the 1804 Silver Dollar with the Eisenhower Dollar.

You see, mass proof set purchasing, which exists today, was not a part of the coin market in 1936! As such, few sets were assembled by collectors as each collector had their own field of expertise which may not have included the "other" proof coins which were available.

All that changed in 1950 with the introduction of the "complete proof set" insetaed of ordering individual coins! But, did it really change?

Not according to the number sold it didn't as folks STILL did not order that many proof sets.

It wasn't until Proof Sets began to be MASS Produced AND the collecting community was cut off from Proof Sets, that it really took a turn.

1964 and then 1968 began an era of multi-million proof sets which were marketed, based upon values for the 1936 to 1950 Proof Sets.

Are US Mint products a poor investment?
Not to those that got 2008 Reverse of 2007 SAE's which were purchased for $25.95 and sold on delivery day for between $250 and $10000
Not to those that got 1970 Small Date Proof Sets or Mint Sets which to this day still sell for between $90 and $150
Not to those that got DDR Proof Sets in 2009 whose coin could be sold for as much as $2500
Not to those that purchased the CnClad Army Half Dollars for $19.95 only to sell for $79 to $99 later.

The whole point being is that just like with any other business opportunity, YOU GOTTA PAY ATTENTION!

When the 2006 Kennedy's had an all time low coin production (less than two million) I loaded up and was able to sell those 2 roll sets, which had been purchased for $32.95, for close to $100 each.

Not a bad investment at all. I only wish that my cojones were a bit bigger as the profits would most certainly have been larger.

Having said that, I also need to add that I am not alone as there are now many, many big time dealers out there with the exact same attitude which basically means, it's all about WHO gets to market first.

 

I think as a general rule...the mint products are a bad investment. By that, I mean if you were to buy EVERY product EVERY year...you would lose on far more than you would win. However, if you are selective...and have a bit of luck along the way, you can really do well if your goal is to make a profit. That said, it does take some luck. For example, the last mint product I bought...the 25th Anniversary ASE Set. I figured it would be a hot item and I was right. It worked out well.

That said, I don't buy coins (from the mint or elsewhere) to make money. I do it because I enjoy it. I bought one 25th Anniversary Set because I truly believed it would be more expensive to do it on the secondary market and I wanted one in my collection. Turned out I was right.

 

Do you think the HOF coins are a good investment?

 

Long term or short term...and bought from where (and at what price)?

 

Long term? No.

Short Term? So far they have proven to be just that. But remember, those on the market now are those that were picked up and graded at the Baltimore Show.

This, in effect, coupled with the fulfillment centers slow turn around, has created a craze in the market which will pass once all of the products have been delivered.

Some that ordered, will be left holding their "at cost" bags while others simply won't care because they ordered just for their own collections.

 

As with any tangible investment, it all comes down to judging supply and demand. At issue time, the available supply is the lowest because of shipping delays and the time needed for coins to work their way out of dealers hands. The demand is often the highest due to novelty and uncertainty of supply. So for popular designs there's often a surge. When there's an amply supply at release for things like proof sets, proof commemoratives, and "collectible" bullion, to my mind "real" appreciation not linked to inflation or bullion prices is unlikely.

Then there is the "stuff" with limited appeal at release such as the First Spouse Gold. I call those wild cards, because at some later date the low mintages may make them appealing to collectors. Examples include the uncirculated Jackie Robinson $5 gold coin and the 1995-1996 32-coin Olympic set.

But my guess is that in order for significant appreciation to occur, interest in the series has to "wake up," and if and when that will occur is simply a guess. That has occurred with modern commemorative to some extent, but not yet for stuff like fractional platinum coins. But if you're willing to tie up your money in relatively unattractive coins with a very thin market, my guess is there's some money to be made in the medium term.

 

In my opinion, it does not make sense to equate such collector coins with bullion issues. If one wants gold (or platinum or silver) from an investment POV, just buy an ounce or more, as a bar or bullion coin. With a collector coin you also pay for the (issue specific) design and, in this case, the special shape too.

In general I think that yes, you can sometimes get a good deal when you buy coins or sets from the mint, with the intention of selling them later. Problem is, you can hardly plan this in advance.

Christian

 

How many times does it need to be said? "Coins are a bad investment!" It's a hobby that can give you years of fun, but it's like buying desert property hoping to find a gold mine. The odds are against you.

IMHO, a great investment would be a car in good working condition.

Chris