So, this recent manipulation got me thinking. Krugerrands and other bullion coins follow the spot price, whereas numismatic coins seem to have a natural bottom. Does anyone here use numismatic coins as a hedge against short term price dips? I haven't bought any since I'm buying gold and silver to hedge my long term risk. Should I be hedging my short term risk as well?
Welcome! Good question: my understanding - i do not know much at all about numis - is that numis' prices are not too correlated with the PM prices. It should work both ways, both when PM prices go up or down. Then again there are many categories of numis: from the old rarities which price is not determined by spot to semi- numis that follow spot more closely. Would be interesting to hear how the numi guys see it. I personally would not so much see it as a shirt term hedge, but rather a different investment class. Cheers
Good question, Generally I like bullion coins due to the closer price to spot, but mixing in a few nice numismatics where I feel the premium is justifiable given the coin itself, appearance, low mintage etc, is something I now do. Just mixes things up a bit, which I personally like.
Welcome to the site DKStacker. While I don't really collect I have gathered a few Numi's along the way and they do seem to hold their value irrespective of spot price falling, that said there are also times that I have grabbed one or two of X supposed numi only to have it fall in price. I think if you stick with the well recognised higher priced Numis then yes you could hedge against short term price dips. But it could also cost you in ounces over the longer term as while they will hold their value on dips you wont get the corresponding increase in price as they also generally have a ceiling price as well as a floor price.
Numismatic coins have high potential... but, if you have little money, you'd better avoid them! If you have 25,000 $ to "waste", you might want to buy 1-2 numismatic gold coins. What I'd to if you cannot choose: I'd buy Chinese Pandas, because they are so unique and their price rises over time. Each year's Panda is unique. Buy a Panda this year and it will be rather numismatic 2-3 years later! Personally I don't like to count on numismatic coins, after all, the gold content is that counts primarily. With the Panda you get both in one: gold content and numismatic potential. Otherwise - Krugerrands are not the ones you should start with if you are at the beginning of collecting numismatic coins. They're not among the best investment coins, you know... but they're popular. Go for the Pandas, I say!
I wouldn't buy coins from countries renown for making counterfeit goods. Especially where its govt allows the practice.
Pandas are genuine coins. You buy them from a reliable merchant and you test them. It's OK to buy these coins.
Here are some techniques that could help identify fakes: *the neodymium magnet test: if it sticks to it, then it's not gold *test the weight: if it's more or less, then we have a major problem with that coin! *measure dimensions to see if it fits the same width and thickness *if you have a trained eye, then you can see pure gold by its color *compare color of pure gold coin with other gold coins/bars (if you have) *many fake gold coins have very rough edges, because they are made of harder metals *do an acoustic comparative test with a strong microphone: I used to experiment with a walkman and a microphone in the past - if you slightly knock the coin (just don't damage it), a filled coin will sound differently than a pure old coin *ultrasound gold test - if you have the equipment... it's expensive to buy the best equipment, but for 200-400 $ you can get "pocket" testers... To minimize the risk of buying fakes: *only buy from reliable (prestigious) merchants, no eBay, not flea markets, not "from the hand" etc. *buy packaged or slabbed coins *buy smaller coins: not larger than 1 oz, because it's less worth faking and it's also harder faking the smaller ones (1/2, 1/4 ounce coins, if you wish...) *buy from different merchants and compare them: even slight visual differences might indicate fakes Testing silver is easier. The acoustic test and the neodymium magnet "slide test" is easier. Too bad that tungsten-filled gold bars are very well-made fakes. They fake the weight, they even have gold on the exterior. But the ultrasound test will show you even if you get such a fake bar! Of course, I think it's less possible that they will struggle to make tungsten-filled Panda coins. Tungsten melts at above 3,400 degrees Celsius. So it's "not worth" faking coins with tungsten. Counterfeiters would rather put all that energy and money when making fake gold bars. Fake 1 oz coins shouldn't be all that sophisticated. I didn't mention the acid test, because it destroys coins. Here are some interesting vids: pocket tester: http://www.youtube.com/watch?v=aSmoFSsb-9U more complex ultrasound testing: http://www.youtube.com/watch?v=5OO7f5yEpg0
I don't think there has been even one fake Panda that could not be detected by visual appearance alone.
Which is sound advice however selling them when you as a buyer are not a reliable merchant just a humble stacker then becomes a problem?
If its coated, then it can look very good, you know. It might as well look very well. Of course, a well-trained dealer can tell a lot only by looking at it.
Yep. Pandas are incredibly intricate coins that the production of 'super fakes' (a counterfeit coin that cannot be distinguished from a genuine one) is unlikely.
You are absolutely right! It's the selling-back that brings most problems... including: *few will buy it back... *...especially when gold hits a high price! *...they will give you less than it's worth... spreads are what they're living from *...some dealers will reject certain types of coins, bars... for the mere fact that they don't like them (even if genuine): numismatic non-pure coins are harder to sell, slabbed coins are often harder to sell (they cannot take them out and verify them) etc. etc. *suppose you have a high-priced numismatic coin that you could sell at an auction... well, getting there and actually selling it is a headache!
I recently received some fake Panda from ebay and even though i did not have a real one to hand i was able to tell straight away that they were fakes. He even had over 20 positive feedback on these coins before i bought them but has now been banned after i contacted ebay. I also contacted all the buyers that left him positive feedback. The seller was from USA also so i did not suspect it as much as i would have if they had been from China. There is another 9 still on the way from the same seller and i have already received a refund from ebay for the ones pictured below. Source: Source: Source:
I don't have any 2013 pandas. But can see these are fake straight away by the fur on the pandas being to coarse among other things. The real thing has much better detail. Glad you got your money back.
