Price Of Metal Vs. Value Of Coin

Your question actually has several answers depending upon how you approach this endeavor.

Since you are apparently just starting out I would treat this hobby as if you were buying a mutual fund that is typically composed of hundreds of individual stocks for each mutual fund.

Unlike owning just one single expensive stock this hierarchy of funds structure spreads out your downsize risk when the S & P tanks, for example.

Using this similar logic I personally would purchase several lower valued coins such as higher grade large cents that can have appreciably increased values as the grade nears XF to AU etc.

Stay away from the very expensive coins ( $ 100 +) since doing so should diminish (not eliminate) the possibility of encountering counterfeits.

I would suggest staying in the $ 20 - $ 60 range per coin at first which should hopefully help you to avoid encountering much of the junk copper coins.

These type of coins would have much less downside risk if precious metals suddenly dive but would still increase proportionally relative to the prevailing inflation rate.

Before you choose the type of coins you wish to concentrate on I suggest going on line or to a library to research the historical trends of coin prices found in the older editions of the Red Book (retail) or better yet the Blue Book (wholesale).

For example check out how the coins you have decided to collect performed during inflationary times (record high prime rate year 1980) compared to a low inflation period (1947).

The following chart should assist you to better focus on the periods in question:

http://www.wsjprimerate.us/wall_str..._history.htm

Both of the reference books I referred to above are written by R.S Yeoman.

The following link may shed some light on the Red Book, for example:

http://news.coinupdate.com/review-o...-coins-0748/

Good luck and welcome to the CC.

@ mpmedia,
Thanks. That is the kind of advice I'm looking for. Like diversifying a portfolio, within a portfolio.
I really haven't decided which coins I like the most and I'm definitely concerned about getting counterfeits and not knowing it.
thanks again

Metals and numismatics are two separate markets, each running independently from one another. Each has a different supply and demand curve. It's the intersection of those curves, in each, that determine the values. When the metals value eclipses the numismatic value, the value of the coin is adjusted, accordingly, to reflect that higher metals value. That's how that works. As I understand your goal, it's an investment goal, you want to invest in coins the numismatic value of which far exceeds the metals value. Do your homework, study-up, find those coins. It's as simple as that.

If your going to collect coins, the best advise is to do it as a hobby, not an investment. As a hobby you will enjoy it all more, be happier with what you have, not worry about some metal prices, find people with more knowledge about history than stuff in the ground.
Forget about the prices of coins since that would only lead to you getting old before your time.
Hobbies are for fun, relaxation, education, etc. For example people that build and fly model planes and then they crash, usually just go bank and work on them some more. It's fun and although they lost a lot of money on that plane, so what. There are people that spend small fortunes on a car just so they can show it off at car shows. Usually will never ger what they put into it if trying to sell it since that was never the purpose.
And think of this. All those people that are melting down or having melted down what they consider only melt value of some coins are actually increasing the value of what is left. So collect what you want and in the future all those that melt coins will make you rich.

I could not agree more!

I do not think we are saying that at all. At least I am not.

I do care about price when buying. I do not obsess about it, but I do my research. However, once I have the coin, then the value becomes less important. I also try to avoid the "If I wait a while longer, the price might be better!" game. That is, if I find the coin I want and the negotiated price is right for me, then I bite!

I will have no regrets if I buy some silver coins now at these near record silver values and the price of silver later crashes (bringing the value of these coins down with it).

Ok Jbuck - I don't know how to do the proper quote thing, with it in the box and all, I'm sure I'll figure it out. But in the meantime...

"I will have no regrets if I buy some silver coins now at these near record silver values and the price of silver later crashes (bringing the value of these coins down with it)."

That is the culmination of some good advice!!
Thanks

Or if you have the same stuff on your screen as I do, at the top there is that EDIT thing. You can use your mouse to highlight something, go to EDIT, click on it and you should see a thing called
copy. Click on that and you copy what was highlited.
Now above the box for when you do a reply, there should be a box with a thing that looks like a page with an arrow. If you place you cursor on that it should read "Insert Quote. Click on that and the quote things should appear in the reply box. Place your cursor between the two ][, got back to edit and click on Paste and everything you highighted should appear in the reply box.
This is the way I do it. Oddly enough when I read what I just said it sure sounds complicated.


See like that.