Antique coins issued more than 100 years ago have collectors all over the world. As a result, it has recently become a popular investment target.
In this article, in addition to the advantages and disadvantages of investing in antique coins, we will explain the current situation such as the market size and how to start. We also introduce how to choose antique coins for beginners, so if you are interested in investing, please refer to it.
What is Ancient Coin Investment?
Antique coin investment is an investment method that buys valuable coins issued in old times and sells them at a higher price than the purchase price. It is mainly preferred by the intellectually wealthy class, and the smaller the number of coins issued and the number of remaining coins, the higher the price is traded.
In the following, we will introduce examples of specific types of coins, divided into “collection type”, “base type”, and “hybrid type”.
| Comparison item | Collectible | Ingot | Hybrid type |
|---|---|---|---|
| Overview | A coin with high rarity value and collectors all over the world. | A coin containing gold. | A coin that combines the characteristics of a collectible type and a hybrid type. |
| Worth | Linked to premium value | linked to gold price | Linked to premium value and gold price |
| Element of Growth | scarcity and demand | gold price | Scarcity, demand and gold price |
| Acquisition Difficulty | varies by coin | relatively easy | varies by coin |
| Coin Case | ・Morgan’s round silver coins・Coins related to the British royal family | ・Austrian bullion gold coins・Canadian bullion gold coins | ・Krugerland gold coin・Gold coin issued by Napoleon |
Antique coins were generally issued 100 years ago, but nowadays all investments in coins are sometimes called “antique coin investments”. The types and brands are also introduced in the article below, so if you want to know more, please check it out.
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Recommended Genres for Investing in Antique Coins｜Introducing Popular Brands
Market size and examples of antique coin investment
According to Stanley Gibbons, the value of antique coins has been growing since around 2000, surpassing the UK real estate price index in 2009. After that, the price of antique coins temporarily fell below the price of gold, but the value of antique coins has risen steadily even when the value of other financial assets has fallen.
Let’s take a look at a few examples to see how much it’s actually rising.
| Coin Name | Soaring example |
|---|---|
| 1839 British Queen Victoria Enthronement Commemoration”Una and the Lion” 5-pound gold coin | 2011: 4-5 million yen2018: 50-60 million yen |
| British Victoria Oldhead 10-piece proof set | 2007: 1.2 million yen2017: 40 million yen |
| 1914 China Yuan Shikai Memorial UNC | 2007: 320,000 yen2017: 1.8 million yen |
Among them, the soaring case of “Una and the Lion” is famous, and in the August 2021 auction, a 5-pound gold coin was sold for about 150 million yen (114 US dollars). In addition to these, it is not uncommon to find antique coins whose value has increased several times in a few months to a few years.
Benefits of Investing in Antique Coins
So what are the benefits of investing in antique coins? Here are some of the advantages it offers over other financial products.
Start with a Small Amount of Money
There are various investment targets for antique coins, and cheap ones can start from a few hundred yen to a few thousand yen. For reference, here are the purchase price ratios published in Coin Library Principal.
Although expensive coins are also popular, about half of buyers (48% of the total) buy coins under 1 million yen. There is a wide range of investment targets for coins under 300,000 yen, so even people with a small amount of funds can start investing in antique coins.
Also, recently, a service that allows you to jointly own antique coins has appeared. If the market size continues to expand, there is a possibility that services that can be easily invested in will expand.
Resistant to Economic Shocks and Financial Crises
Antique coins tend to be more resistant to economic shocks and financial crises than financial instruments such as stocks.
When the Lehman shock occurred in 2008, the Nikkei Stock Average fell by about 40%. On the other hand, antique coins continued to rise steadily during the same period, and you can see that their price movements are different from those of stocks.
Even after the corona shock at the end of 2019, precious antique coins have been traded at high prices. Since it is also resistant to inflation, you can expect a risk diversification effect just by incorporating antique coins into your portfolio.
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Even Busy People Can Continue
The fact that you can save the trouble of collecting and analyzing information is also a unique attraction of antique coin investment.
For example, when investing in domestic or US stocks, it is necessary to frequently check stock prices and economic news. Real estate investment, which is a countermeasure against inflation, also requires time and effort such as recruiting and managing tenants.
In that respect, antique coins can be started only by checking the market price, so it does not take much time and effort compared to other investments. Buy coins that are likely to go up in value, then just wait for the right time to sell.
If you decide to sell it in 10 years, you won’t have to worry about the timing of the sale.
Disadvantages and Risks of Investing in Antique Coins
Antique coins are an asset that can also be used as an inflation countermeasure, but there are also disadvantages and risks that you should be aware of. Here are some points that beginners should pay special attention to.
Transactions Take Time
Compared to precious metals such as gold and investment products such as stocks, the market for antique coins is not developed. Since the places to buy and sell are limited, depending on the coin, it takes time and effort to trade.
However, recently, a convenient service that allows you to combine buying and selling has also appeared. The market is being developed little by little, so it may be possible to trade easily in real-time in the future.
You may Fall Victim to Fraud
There are fake antique coins, and investment fraud can occur, so you must first find a reliable seller.
Beginners should be especially careful when purchasing coins at online auctions and online shops. There is a risk that these services involve unscrupulous traders targeting beginners, as it is difficult to distinguish fakes from photographs.
If you are worried about counterfeit coins, look for a reliable seller, such as a vendor with special insurance.
Difficult to Collect and Analyze Information
Antique coins tend to be difficult to collect and analyze information due to the small number of stores and services that handle them.
For example, information about stocks and investment trusts can be gathered through online securities and news. There are plenty of analysis tools, so it is not difficult to set up a trading environment like an expert.
On the other hand, some antique coin information is written in a foreign language, so language skills such as English are required depending on the brand.
How to Start Investing in Antique Coins
There are many ways to start investing in antique coins, such as online auctions, online shops, and private coin dealers. However, these methods require knowledge to identify counterfeits, so it is recommended for beginners to purchase from a reliable coin dealer.
Coin dealers have a good guarantee, and if the coin you purchased is counterfeit, you can take it back at the same price. In addition, the fact that the price standards are clear and that they can handle up to the sale will be an advantage of using a coin dealer.
However, it is important to check the details of the service before using it, as the brands handled and the details of the guarantee differ depending on the company.
Points for Choosing a Coin Brand for Antique Coin Investment
In order to succeed in antique coin investment, it is necessary to purchase coins that tend to increase in value. From here, we have summarized the points of brand selection, so if you are just starting out, please refer to it.
Predetermine your Investment Budget
Antique coins do not always increase in value, and there is a risk of loss depending on the brand. As with any financial product, you should not borrow a lot of money to invest.
So start by setting a clear investment budget. If you decide the budget in advance, such as “less than 300,000 yen” or “300,000 yen to 500,000 yen”, it will help you narrow down your investment targets in an easy-to-understand manner.
Analyze Rarity, Grade, and Demand
The value of antique coins is generally determined by three factors:
○ Elements that determine the value of antique coins
Rarity: The fewer coins, the more likely they are to have a premium.
Grade: The condition of the coin. Appraised by a professional appraisal company.
Demand: There is a high demand for coins that are beautiful to look at and that depict historical figures.
“Rarity” is a point that greatly affects the selling price. As you can predict from the number of issued coins, most of the coins that are dissolved or lost are likely to have a premium, so let’s pay attention to the “remaining number” and analyze it.
Thoroughly Avoid Transactions with Unscrupulous Traders and Fraud
The biggest risk in antique coin investment is the existence of unscrupulous traders and fraud. No matter how rare coins you find, you will not be able to make a profit if you encounter these.
Therefore, it is necessary to acquire knowledge and collect information to identify counterfeits and frauds, and thoroughly avoid transactions with unscrupulous traders and frauds. If you can afford it, let’s check in advance about the tricks that are common in fraud.
There is also a possibility that the Number of Soaring Cases will Increase Asset Management with Antique Coins
Antique coins may become even more attractive investment targets given the expanding market size and services. If global attention increases, there may be more cases of soaring due to the increase in collectors.
Specialized antique investment services have already appeared in Japan, so if you are interested in asset management, take this opportunity to consider.
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