Increase Your Net Worth by Investing in Rare Coins

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Are you interested in diversifying your portfolio? Are you stymied by all the choices for investments? Every investment comes with its risks. You can’t possibly know exactly what the economy and the market will do in the coming fiscal year, but some investments come with higher risks than others.

While higher risk investments generally come with higher yields, it’s good to hedge your investment bets with some lower risk, long-term bets. Investing in rare coins is one of your best opportunities for increasing your net worth.

Silver and Gold Coins for a Great 2014
When investing in rare coins, your purchases can be valued one of two ways. Bullion coins, made of a single precious metal like gold or silver, are valued for their metal content. For example, no matter what the value of a gold coin to collectors, it will never be worth less than its weight in gold. Your coins could be scratched or marred in some way, making them less valuable to collectors, but it will still be a good investment, as long as the price of gold rises from its value when you bought the coin(s), you’ll make a profit when you sell.

The other way to value coins is by their rarity and condition, basically their value to collectors. There’s a standard in place that grades coins on a scale of one (or zero) to seventy. At one (or zero, if your coin grader is being brutally honest), the coin is so damaged and marred that it’s difficult to tell that it was ever a coin to begin with. A penny that’s been run over by a train would be a zero or a one. A coin graded at seventy would be in perfect condition.
When you’re investing in rare coins, and you look at a coin’s grade, you’re looking at its numismatic value, its value to collectors. If you can find a coin made of precious metal that has a high grading, you’re sure to have a good investment on your hands. This coin will potentially be worth more than its weight in gold to collectors.

According to financial analysts, silver coins are a property to watch this year. Silver looks to be on the rise, though analysts do warn that silver will have a bumpy ride on its way up the market. If you’re investing in rare coins, and you choose silver, expect to hold onto your investment at least until 2016.

As far as gold coins go, it’s been flat in 2013, but 2014 is expected to be a very good year for this precious metal. If you’re looking for a shorter-term investment, consider gold bullion coins, which you will most likely be able to turn around in the coming year for a profit.

Cautions for Investors
If you are investing in rare coins, there are two major things to look out for to protect your investment: over-grading and counterfeits. If you are a novice coin investor, you should absolutely get some trusted advice and educate yourself on the coins you’re interested in. You don’t want to lose money on your investment.
Over-grading refers to a coin that’s valued at a higher grade than it’s actually worth. Say, for example, you buy a coin that someone has graded at a sixty, but it has a number of marks and scratches. This is an over-graded coin. If you’re investing in rare coins, your purchase will probably still be worth something, but it is likely to be worth a good deal less than you paid for it. In this case, you’ll have to wait a great deal longer than you anticipated recouping your losses or making a profit.

The other thing to look out for when investing in rare coins is counterfeit coins. A counterfeit coin will not be worth anything but the weight of the material it’s made of. You’re very likely, if you fall into this trap, to lose a deal of money. Fortunately, counterfeits are fairly rare, and enlisting the help of a coin expert can avoid this pitfall.