This article was originally printed in the latest issue of Numismatic News.
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How many individuals are investing in the one-ounce proof platinum $100 American Eagle coins? At a price of $1,892, my reflexive response might be: not too many.
A price that high is a far cry from saving America the Beautiful quarters from change. But as every collector knows, price does not tell the whole story.
As this issue of Numismatic News goes to press, the proof platinum Eagle is very nearly sold out. This is just after five days.
Of course, the Mint has set the maximum mintage level at 10,000, which is not a very high number, though it is 25 percent higher than the 8,000 number from 2009. With an order limitation of five per household, theoretically just 2,000 buyers could take the whole issue.
Foreshadowing this rapid sellout was a similar event on a smaller scale at the U.S. Mint booth at the American Numismatic Association’s World’s Fair of Money in Boston. Within an hour of the proof platinum American Eagle going on sale Aug. 12, the booth was cleaned out of its 50 coins. I mentioned this to Eric Jordan, who happened to be sharing our booth on the bourse floor at the time.
Eric is the author of a new book, Modern Commemorative Coins. It was recently published by my firm. He was attending the convention hoping to sell more copies of his book, which includes American Eagle coins and other special collectible issues from the U.S. Mint that have limited mintages.
Eric told me the platinum American Eagle would sell out fast this year just as it did in a week last year. He forecast that many, if not most, buyers this year would be custodians of Individual Retirement Accounts.
In light of what has been happening in the days immediately following our conversation, Eric seems to know just what he is talking about. The Mint seems set to gross $18.92 million with a profit margin of roughly 22 percent over the metallic value, or $3.46 million.
Whether it might be wise to be buying this coin for a retirement account rather than as a collector’s item is another question. It is a bet not only on the possibility that platinum bullion will continue to rise in value over time, but that collector demand might also give it a boost.
Either or both of these factors could make this a winning investment proposition. However, it is collector demand that could be the rocket fuel. Eric has done his homework and offers an analysis of this and other modern Mint coin series. His thesis is that the bulk of the value of any set is concentrated in the top pieces.
When I returned to the office, I found other evidence of high interest in the platinum American Eagle in the text of this week's Viewpoint.
I also received a handwritten letter sent to me to be forwarded to Eric. It complimented him on the book and basically asked for his list of recommended coins so that the letter writer would not have to buy a copy. I prefer to tell the writer to go to www.ShopNumismaster.com.