Collecting vs. Investing

In my humble opinion the main difference between collecting and investing is that a collector collects whatever pleases HIM/HER, whereas an investor collects whatever will please THEM (other people). Investors tend to be a bit harder to satisfy and a bit more picky perhaps because they are trying to predict the value of a particular coin in the future (near term or distant).

Investors will primarily stay with the tried and true; Morgan S$, Walking Liberty halves, 'Mercury' dimes, and Indian Head (Buffalo) nickels, to name a few. They will buy as nice a coin as their pocketbook will allow and part with it at any time they can make a nice profit, especially if they believe the market is too hot and due for a correction. It's all about supply and demand.

Collectors, on the other hand, get taken in by the appearance of the bright, shiny, new coin from the U. S. Mint. Most collectors will not part with their prize possession (I guess you could pry it out of they're cold, dead hand) for almost any amount of money unless they know they can replace it for less than they're offered. Collectors also tend to buy a lower graded coin to fill a slot until something better comes along. Collectors don't see any reason to adhere to the Law of Supply and Demand because they are never going to sell, therefore they will pay astronomical prices for 'common' coins with high mintages. It is my belief that many of the new issues that collectors are buying at inflated prices in ms or pf 70 will take a real beating as more of these coins get graded.

Law of Supply and Demand: when something, i.e. coins, tulips, etc., are believed to be scarce, demand goes up and correspondingly the price also rises. Dealers and investors send in more coins to be graded and the supply increases, demand falls, prices drop.

All of us are probably a combination collector/investor and I'm certainly not saying one is better than the other. I am saying that the smart money is going into the truely RARE coins that will more than likely remain rare (unless another Redfield Hoard of 400,000 Morgan S$ shows up). A word of caution for all of us; check the mintages of a particular coin and the population reports of NGC and PCGS (the other TPG services probably don't matter), and remember that the pop. reports are probably 10-20% high due to re-submissions.

I am not trying to do anything to anybody except be helpful from my perspective of 50+ years of collecting/investing. Take my advice or leave it, makes no difference to me, but PLEASE don't write some drivel saying 'that there is no use debating the difference between investing and collecting'. Thanks for your time and Happy Collecting or Investing or a little of both.

I'm audrop and I approve this journal entry. Have a GREAT day!