By Richard Giedroyc
The same question of the extent of market participation and who is participating in the market that is being asked of stock market investors should be asked of those individuals fancying themselves as coin investors rather than serious collectors. Anything that can be considered scarce to rare or has been certified to be of unusually high grade has a higher probability of being offered in an auction rather than over-the-counter in the current market.
Auction fever is increasing, with spirited bidding and strong prices being realized. How many true collectors willing to pay what it takes versus individuals whose eye is only on the current and future price tag is coming more into question as values increasingly move upward.
At the same time, the vast majority of coins are impacted by the spot price of their bullion content. These coins continue to trade primarily over-the-counter in a tight range shadowing the market price of gold, silver and platinum. The majority of collectors are more likely to be in this arena. Investors are present as well, but their interest is solely based on intrinsic rather than on collectible value. Demand in this sector of the market is steady, but current growth is questionable.
The expansion in the upper end of the market, i.e.auction houses, appears to be based more on total hammer prices than an increase in market participation. The bottom line: we still have much room to expand interest in the collectible coin market.