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 Replies: 16 / Views: 2,718 |
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Pillar of the Community
United States
1189 Posts |
So I have exclusively been a collector of copper and silver. I have a small collection, nothing to write home about. I've always stayed away from gold just due to the fact of how expensive it is. I had never even looked into gold american coins for that reason. Last night I was bored and started looking online a bit. I came across the Saint Gaudens $20 coin and was really amazed by it! It looks really nice! I see where just the melt value of it is over a grand!! You can buy an AU specimen from APMEX for right around $130 over spot (so still a lot of money, $1300). How much of the value of this coin is driven by numismatic value vs. the spot price of gold? Basically, if gold plummets.. will the value of the coin spiral down with it too or is it old/historical enough to still hold numismatic value? How much did one of these cost back in the late 90's/early 2000's when gold was around $400 a oz? Is it better to buy a slabbed/graded 65+ one rather than risk it on a AU one? I'd really like to pick one of these up but I'm not up for a super risky investment. I have no idea what the value of gold is going to do, so I'd hate for it to drastically fall and lose $500+ on my investment! This is also something I'd only be able to purchase one of, I'm by no means wealthy so I don't think I will ever be able to start up a collection of them :) Any thoughts? |
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Pillar of the Community
United States
7390 Posts |
If a common date/mm coin sells for close to its spot value it tends to track major jumps in spot prices. Not so much daily fluctuations though. So if gold takes a crash say down to $300/oz then that coin will probably be offered for $4-500. That said, I doubt, save a catastrophic national or world crisis gold will drop that low.
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Pillar of the Community
United States
7375 Posts |
Quote:
I'd really like to pick one of these up but I'm not up for a super risky investment. Imo, don't think of it as an investment. A hedge, maybe. Something nice to own, yes. Gold peaked out a couple of years ago, so be happy you didn't buy gold then. A gold coin would be fun to own. I'd like to buy one too. This is probably a good time to buy one. |
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Pillar of the Community
United States
711 Posts |
Coins like that tend to track spot price fairly closely. Say you bought it at spot plus $100. I'd view the $100 as the numismatic premium, which is fairly minor, say 8 - 10% of the total purchase price. Unless the supply and demand were to change for the numismatic premium, I would think you would still be able to sell it at retail for the same spot plus $100. That being said though, premiums have been coming down on common circulated US Gold coins. Probably why I buy them. They certainly aren't popular at the moment it seems. From what I am reading, I think you might be more comfortable with a smaller gold coin. The US Gold Eagles have the same design as the St. Gaudens and come in 1/10th, 1/4, 1/2, and full ounce sizes. More premium on the smaller coins, but same design. Personally I like the old circulated US gold coins, in particular the $5 Liberty and Indian Head Half Eagles. Maybe $400 or so in a slab for a nicer grade one than you were looking at on APMEX. If you got a dealer you trust, you can pick one up raw for $315 - $360 no problem. My last two gold purchases were even smaller, $60 cash for a 2 Peso Mexican gold coin. 1945 year. Just under 1/20th of an ounce. My LCS treats me well but you can get one for $80 no problem I am sure. |
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Valued Member
United States
234 Posts |
I try and buy coins that are 50% numismatic and half melt. This way I'm insulated from these fluctuations.
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Bedrock of the Community
United States
10982 Posts |
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I try and buy coins that are 50% numismatic and half melt. This way I'm insulated from these fluctuations. That's a good way to look at the situation. Coins like the OP describes are often referred to as "generic gold" and as such are priced directly off their melt value. These days a top tier certified MS63 & MS64 Saints that are common dates trade for a nominal amount over melt. They are tied to spot but at least are certified as genuine and choice uncirculated so I'd go that route. Another option is looking at lower survival rate pieces at under $2,000. Just some thoughts from the peanut gallery. |
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Pillar of the Community
Canada
3049 Posts |
If the price of a particular coin is within range of spot.. chances are high and likely that if/when it comes time to sell it will also be for around spot. That goes for almost any gold piece that's out there on the market right now.
So with your example of the Saints... you're paying $130 to have that coin over a generic piece of bullion. If/when you sell... you may be able to get some of that premium back .. most likely not.. a dealer will most likely buy at spot and no more.
The way I think of it is as such... I buy a 100 -300 yr old coin for only 100-200 above spot... and hold it for 15-20 years (even longer unless gold surges skywards) I'm really only pay $5-10 bucks per year to have something that has a bit of history attached to it. It's really not a bad price when you put it in that perspective... And as gold itself really never loses it's value... it's not a bad place to put a little bit of your extra $$
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Pillar of the Community
United States
1450 Posts |
I think of buying gold coins as more of a hobby rather than an investment in gold. I know a few of the collectors here collect the quarter eagles and half eagles like the Indian Head types. These to me have value of both worlds. They are gold and they are unique and collectable on their own. Also, the quarter eagle indian head is affordable as is the half eagle except for the 1929 which was melted down mostly. The Saint-Gaudens is the finest gold coin IMO, but after 1925-26 they become so expensive it is hard to imagine actually completing a collection. I agree with others that actually just owning a 20 gold piece is a consummation devoutly to be wished. The earlier double eagles are also fine, but they too are expensive if you get them in Unc. condition. They far exceed the gold value because they are so rare in that condition.
I find it hard to just finish 20th century silver coins like SLQ. You will pay a bundle to finish that collection especially the 1916 and some of the others in better than AU condition. If I could just collect them all in Fine condition I would be happy. Coin collecting to me is a hobby. There are better ways to invest in commodities just for profit I think. You notice the silver eagle bullion coins have become collectible and now have a value beyond just their silver content. I bet the same is or will be true for the Gold Eagle. Anything is collectable in time if it is scarce and if they stop making them. Who knows they may change the gold bullion coins image and then the gold eagles will probably appreciate. The most bizarre collectable of all is fine art. It has no intrinsic value and yet the prices are insane. Check out the prices for the latest auction sales of expressionists or impressionists.
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Pillar of the Community
Canada
3049 Posts |
terry: by your own argument you state that once they change the design of one coin that they make it may become more valuable....
Art is very similar only that it's only once the artist has died that the value of the work actually appreciates, and this is only because the artist is no longer able to put out anything more.
The major difference I have seen with owning paintings or sculptures over coins...
I will show a friend a coin that I have to pull out of a safe.. and they will immediately say.. "wow.. so what's that worth?"
The art the I do have (and they're not huge/high end pieces) usually is already out on display... and a friend/guest will say
"wow I really {like/dislike} that!"..... few minutes later... "so what's that worth?"
at least with the art I can talk about it for even a short time.. but with coins unless they're coin people.. I usually "zombify" them when I start talking about mintages, fires, varieties or what of a 1000 other factors that make a coin desirable to the few of us that really LOVE coins.
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Pillar of the Community
United States
7390 Posts |
Ya, people usually give u that stare and say something like "wow, you have to know so much about coins to get into that hobby" then the conversation shifts to the weather
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Pillar of the Community
United States
1748 Posts |
Shop around. You can get MS-62 common date Saints for around $1400 right now. Well worth the extra $100 to have a mint state one. Same goes for common date MS-62 $20 Libs.
Edited by DoubleEagle20
06/18/2015 9:37 pm
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Pillar of the Community
United States
675 Posts |
Several Saints went for just under $1300 (including buyer's premium) at the major Heritage auction that ended a couple weeks ago (can't remember the name of the auction right now). Those included some at MS-63. No need to settle for an AU/low MS, you can get one in MS-63 or probably 64 even for not much additional money.
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Pillar of the Community
United States
1450 Posts |
There are some low mintage, low cost Saint-Gaudens I see that scream to me that these are bargains. I see a 1913S with mintage of 34,000 that sells for $2500 in MS 60. A 1908S with mintage of 22,000 sells for EF for $3750 and 1909D with mintage of 52,500 sells for $3250 in MS $3250 and just $1950 in AU-55. To me these are incredible values. If I find these coins selling from reliable collector I am a buyer. I may never get one because I am not buying online anymore. I have had it with ebay and paypal. In contrast a 1916 LSQ with mintage of 52,000 sells for $15,000 in MS-60. Why not just collect three of these incredible double eagles for less than a silver LSQ in comparable condition. I understand the excessive prices of double eagles that were melted down in 1930's, but I don't understand the low prices of early low mintage St. Guadens. I have not been collecting for 20 years, but now is as good a time as any to get these coins. When you go to coin shows you may notice the age of sellers. Since the USA stopped minting gold and silver coins for circulation I think it has hurt coin collecting as a hobby. This is just my opinion because who wants to collect coins that have zero intrinsic precious value? I watch Pawn Stars on History Channel and I notice when they have a coin to sell it is always some rare gold coin in mint condition. I don't see them selling Mercury dimes or Buffalo nickels. |
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Pillar of the Community
 United States
1189 Posts |
Terry I think the issue with that theory is that you don't know what coins were sent back or melted. For example maybe the 1913-s was hoarded more overseas and a more common date stayed more in the US. In that case the more common date coins were all mailed I and melted while maybe more 13-s survived because they weren't mailed in or melted. I'm completely making up that story but I'm sure you get the point.
Now I'm reconsidering just snagging up a coin or two from the lower denominations. Regardless I need to do a lot more research.
Out of curiosity, how quick did these gold coins get taken out of circulation? When did people realize they were so valuable? Did they ever freely circulate? It sounds like people living before the early 30s had the chance of a lifetime to hoard these! I would think they would be more available for that reason.
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Pillar of the Community
United States
1450 Posts |
FDR did the big recall and melt down of gold coins 1933-34 I believe. These coins did circulate until FDR made it illegal to possess gold or to use it to transact business. Others here know more about that than I do, but there have been several melt downs of both silver and gold coins for various reasons over the years. You know there are other less expensive gold coins like the quarter eagle and half eagle. Some can be had for a few hundred bucks and some because of low mintage and recall for melt down are worth thousands of dollars. I am thinking of 1929 Half Eagle which is valued at $18,500 in VF condition because most were recalled and melted down. There was a break from 1916 until 1929. The 1916S goes for $500 in VF condition. There is a beautiful coin (Indian Head Eagle)which has some very odd features. The 1932 coin is valued at $925 in MS60 while the 1933 is worth $275,000 in MS60. The answer, of course, is the recall and meltdown. The Saint-Gaudens Double Eagle ( a coin most of us admire greatly) is the coin that was really bashed by FDR's recall and the meltdown. Starting in the 1920'd most of the double eagles were returned to the Mint and melted down in the 1930's. This is a quote from the Red Book so the original mintage and coins actually existing have little relationship. 1926 seems to be the year when the numbers minted and those in existence really goes off the chart. I would get a book and read up on this coin's history because the values are so inconsistent. The 1927 St. Gaudens is valued at $1625 in AU while the 1927D is valued at $475,000. The lower mintage of the 27-D does not explain the value. I like to try and collect and complete sets. That just is not possible for me to do with some of these coins. I might be able to do it with the modern quarter eagle, half eagle but not the eagle or double eagle. I am like you though since I sure would like to have a few of each 20th century eagles. Which ones is a subject for research to try and understand why some are so much more expensive than others and the relationship of the mintages to the value. I don't understand why the 1920S eagle is worth $50,000 in MS60 and 1915S in MS63 is worth $8000. Mintage is not the answer. |
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Pillar of the Community
United States
2125 Posts |
I used to buy St.Gaudens 20s in the early 1990s for 349.00. $20.00 were 299.00. I'm talking those were the retail prices.
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Replies: 16 / Views: 2,718 |
Posted 06/17/2015 1:13 pm
