D.R.C. The Formula for buying Rare Coins

Why are these types of coins the better way to invest long term in rare coins and why can’t everyone own them ? In order to answer the first part of that question you the investor must understand what makes a rare coin a good investment. Well it’s not that complicated. The simple formula for investing in rare coins goes like this Demand-Rarity-Condition ( the order is crucial ).

1. Demand is first and most important because without it your coin/investment can’t perform-demand can come from a variety of places -historical significance, collector demand, aesthetic beauty-(in most great coins)- it has two or all three of the qualities mentioned here.

2. Rarity is second because without some rarity the supply can meet the demand-thereby suppressing the price performance.

3. Condition or grade is last and the most over hyped of these three-this is seen mainly in the promotion of high grade certified bullion coins like Eagles -gold , silver  or even fractional platinum also high grade common date US gold & silver. You should know the difference between a condition rarity and a true rarity.

Let me close by saying the coin market in general has this formula upside down by putting condition (grade) first, rarity second and demand last. The reason big retail companies don’t try to sell these types of coins is the same reason you should buy them. There aren’t enough coins to feed the engine of a big retail coin company. The second part of our original question that everyone can’t own these kinds of coins is because it takes a well-heeled investor to indulge in this arena and usually once a key date or rarity is placed it is usually off the market for 20 + years.