Coin Valuation Crystal Ball

[chuckplante]

In the 1960's, while still a kid, I began mailing away for small packages of world coins. The packages cost between $1.00 and $2.95, and each package contained 25 or 30 coins. The coins were all mint condition, low denominations, and primarily from countries struggling with their economies or governments, or purely third world nations. Occasionally these packages of coins included uncirculated coins from the 1940's and 1950's.

 

It has been nearly a half century now and all of those nearly worthless coins of the time have appreciated well in value. Some are now worth about 200 times or more what I paid for them if the average cost was ten cents.

 

This has me thinking. I have a grandson 2 years old. If I buy fairly recently minted, uncirculated, low mintage coins now they could be of such value when he reaches college age that they could provide for a major portion of his college education.

 

The major element of this premise seems to be picking coins from countries that will likely have both stable government and economies in the future.

 

Anyone have of any thoughts on which world coins being produced today, or produced in the past 20 years, could possibly be the big performers of value in 15 years time? My interest is world coins as such coins have the potential of far outperforming coins from major industrial nations.

[jlueke]

I must say I am a bit skeptica of your claim. World coins tend to be quite common and the demand for general issues is not too great. Have you tried selling your packages from the 1960's or are you pricing them individually with Krause?

 

I'm not a fan for coins as investments but as far as monetary appreciation I would recommend buying the best and most desirable pieces you can afford in an area about which you have some knowledge.

[TreasureGirl]

Buying packs of 30 or so world coins seems like a cute way to get interested/started in collecting, but I don't think it would be a good idea if you're relying completely on this, well, gamble, to fund your grandson's education. However, it would be interesting to see what comes of this collection in 15 or so years when you pull it out of the safe deposit box. Who knows? Maybe grandma and grandpa will surprise Junior with a brand new car!

[chuckplante]

I must say I am a bit skeptica of your claim. World coins tend to be quite common and the demand for general issues is not too great. Have you tried selling your packages from the 1960's or are you pricing them individually with Krause?

 

I'm not a fan for coins as investments but as far as monetary appreciation I would recommend buying the best and most desirable pieces you can afford in an area about which you have some knowledge.

 

I did sell some a few months ago on ebay. These were primarily European coins, most from Germany and Hungary. The buyer was from Switzerland. The bidding was robust and the coins did quite well nearly achieving the values listed Krause. The bidding could have been disappointing without the winner and one other European always bumping the high bid. The ending bid doubled in the waning minutes of the auctions.

 

I've since visited ebay Germany, UK and Austria. They each have lots of coin auctions, and comparative European coins appear to do better on those ebay markets than the USA ebay. I haven't done a similar check of Asian or South American ebay sites.

 

Possessing only the English language limits which ebay sites I can list with, but it does make sense for buyers to look beyond their own borders to find deals on coins from their own country.

[ccg]

Much more stuff is saved these days then in decades passed, so potential today for saving "pocket change" is dramatically reduced. Even lots of UNC low denomination coins from the 1960s and 1970s today are of marginal value.

[gxseries]

You see, this is pretty difficult to guess if we are going to restrict just to common circulating coins. Let's say you are born around 1960s or 1950s. We'll take two neighbouring countries of Asia as an example, such as Korea and Japan.

 

At that time, both economies aren't doing too well except the Japanese economy is doing slightly better. You would be thinking that the numismatics value of Japanese coins would do better in the future.

 

Well in a sense yes, for ultra rare Japanese coins such as the oban, the value of such as almost multiplied by 8 times or more which is at least around 20 grand where it used to be just a miserable 2.5 thousand or so in the past.

 

On the other hand, Korean coins are almost disregarded and in fact it is only the recent years that the prices of Korean coins started to shoot up to ridicious values never known before. Typical UNC of Korean coins versus typical UNC Japanese coins of the same years vary in huge prices and often Korean coins of 1970s in UNC are in mad prices (some in range of 400+USD for a year set) whereas Japanese coins in such UNC coins are perhaps just a few times better than face value. There is a period of time where Japanese coins were incredibly expensive during the 80s before the bubble appeared.

 

However the same can't really be said about German, French, Italian, etc, i.e. developed nations. (obviously there are plenty of exceptions such as key dates etc but we'll try to make it as simple as possible)

 

I am guessing that it is the developing countries that collectors have a bit too much money to spend and they are willing to pay mad prices to get whatever back into their country, such as Poland and Russia for example and then after a period of time, prices will plummet and stablize.

 

The same can be said about Indian, Chinese, Vietnamese etc - I am somewhat seeing a slow increase in their value and perhaps they will explode one day. You can't disgard about the fact about collectors of developing nations trying to buy coins of their own nations.

 

Moral of the story: If you are going to be cheap and look for modern "cheap investment" coins, always go for the UNC and keep them in the best condition possible. Another important factor is that one should expect is that one should look for developing nations. I.e. you wouldn't expect the value of African coins to grow any day soon - perhaps 10 generations after you would the values of such coins grow but then, inflation would defeat it's purpose. Hopefully you would expect that being a developing nation, normal circulation coins that circulated in the country would be in poor condition that UNC coins become "scarce"

[chuckplante]

Thanks gxseries. You articulated well a point I tried to make. With economic success comes affluence. There was a news article recently about Asian affluence driving up prices in the art world as wealthy individuals adopt Western collecting habits. We saw this starting with with Japan in the 1980's. It has now spread to other Asian nations.

 

There is yet another factor I failed to mention earlier. That factor is the number of coins minted. I have some uncirculated small denomination coins from nations with populations of about 25 million people that produced a billion coins or more coins of a particular denomination in a given year. I don't look for these coins to ever achieve any recognizable increase in value in any condition. Larger denomination coins are always minted in lesser quantity than small denomination coins. Still, the large denomination coins will not increase greatly in value if they are minted in such quantities that they are overly common.

 

Also, I erred a bit with my initial comments about stable governments. East European countries within the former Soviet Union had stable governments. It took a change in government to ignite greater prosperity that brought about the collectors in these nations. The number of nations worldwide that could see similar change has dwindled greatly in the past half century. In addition, the number of nations regarded as underdeveloped is in decline. These are both good for humanity, but do reduce the occurance of factors that propelled coin valuation increases I benefitted from the past half century.

 

I can look at current production quantities of coins from nations worldwide and see coins of both large and small denominations that would seem perched to grow greatly in value simply because the quantity of particular coins is relatively small. This assures the supply will be small, but does not assure a demand. The demand seems to come with affluence within the nation in question.

 

Germany over the past 60+ years presents a good example of all factors in play. Many of the values of East German coins of equal denomination of the West German coins in a given year of minting are incredible.

[chuckplante]

Buying packs of 30 or so world coins seems like a cute way to get interested/started in collecting, but I don't think it would be a good idea if you're relying completely on this, well, gamble, to fund your grandson's education. However, it would be interesting to see what comes of this collection in 15 or so years when you pull it out of the safe deposit box. Who knows? Maybe grandma and grandpa will surprise Junior with a brand new car!

 

Your resonse helped lead me to a great decision today. All my uncirculated coins, large and small denominations, are going to my grandson. There are over two thousand coins in the batch now. I'll keep adding more every year.

[Scottishmoney]

Collecting in Eastern Europe never went away, it just went out of site. Out of site and out of mind. But I know people that collected coins back then, one of whom was apparatchiki, and had access to better foreign coins etc.