Investing In Coins?

Most collectables dealers, not just coins, but stamps, cards, comics, "antiques", etc, will never make any money because they thinklike collectors instead of like businessmen.

For example, they'll trade even up. So who paid for their time?

Or they'll pay the same rate for $1 worth of silver as they will for a bag. Or they'll spend 20 minutes buying $5 worth of coins they'll sell for $6, not only working for $3 an hour (when they sell, which takes more time), but also not handling another transaction where there's some decent profit potential.

I visited a progressive mall dealer back in the 70s. They paid $5000 for a cash register with very limited category totals, which told them how much 90%, 40%, 10K, 14K etc they bought in a day, so they could turn that amount at a known profit rather than stash the stuff back and forget about it.

He blew the dust off a 2x2x9 box and asked what I would lowball offer if someone brought it in. $900. He pointed out that with stuff like that, the typical coin shop has as much inventory just lying around as the total inventory of most other kinds of stores.

They also made about $20,000 a year (enough to pay the rent back then) by cashing their own checks. If they bought from you, they paid by check. If you didn't want to take the time to go to the bank and deposit the check, they charged 2% to give it to you in cash.

A ripoff? Hardly. If they have to keep $10,000 in the store to cash checks, that's 10% that's not earning anything, and $10,000 that they're at risk of loss in event of a holdup.

Sears has millions of dollars in the bank by starting the day with less than $5 in each register outside the main office. Dozens of registers times thousands of stores times $50 less in each = million$.

This is quite an interesting thread to read. Thanks to all for sharing their thoughts. I don't really know any neumismatists, let alone folks who have been doing it for decades, so again thank you. I hope that my moderate interest in the neumismatic side of coins is worth enough to hang around here. If anyone wants a good laugh ask me about my recent purchases! haha. I'll post some coins photos in the recent-purchase thread this weekend perhaps.

Don't worry, I'm just the same - a complete amateur who's never even bought a coin, let alone understands grades and fluctuating metal markets. I've just been given all my stuff by relatives.

I like reading all the stuff on here and absorbing the more professional side of things. Tbh, you don't have to be buying proof sets or hundreds-of-years old coins to be a collector. You just do it cause you like it.

An interest is an interest, ultimately we all enjoy coins, whether we pick up a few interesting coins worth nothing, or try and invest in gold and silver proofs. And that's the important part.

Simple truth.

Interesting thread this one.

Texas collector I would like to have a coin shop too. But I don't think the profit potential would be worth my time. Maybe I am wrong.

Coin shops are good for buying, and that's about all. There's no good way to advertise to collectors. You either advertise to 100% of the local traffic for the 6%interested in your product, or advertise in the specialty publications, most of the readers of which are nowhere near you. If you sell to them mail order, why do you need a shop?

After reading this thread (and others too), I am really appreciative of the insights of so many of the members of this forum. It is refreshing to find a place nowadays where congenial discussions can occur and such sage wisdom can be offered freely. Thanks!

Some obviously know something. Although not 30 years but well over 60 years now I'd bet there is a fantastic amount of value to my collection. Even 30 years ago if a person had an idea of what they were doing, they may not be rich but sure would have a great increase in their investment. Easy for me to say since when I started you could just pluck Silver coins out of change all day long. Walker halves were as common as a glass of Milk only who could afford the coins. As a kid about 50 years ago I used to fill nickel albums from just one or two bags of Nickels. Can't do that today of course. Then there are always those that invested in Beanie Babies.