How to Profit in Numismatics
There’s more than one way to seek financial gains on purchasing and selling numismatic items. One of the associates at my company with whom I have worked for more than four decades has successfully pursued one strategy multiple times.
This strategy evolved from his long-term interest in doing in-depth numismatic research. His personal numismatic reference library is almost as extensive as that of the company where we work.
The sequence of steps that has earned him repeated numismatic profits include:
1. Identify a numismatic niche that appears to be relatively under-researched that he would be intrigued to study.
2. Acquire existing research in books, publications or online to give himself background information on prices and the relative supply of items compared to the number of existing collectors.
3. Begin purchasing pieces in this niche and establishing personal relationships with other collectors and dealers who specialize in this category.
4. Compile information about this numismatic niche that may not yet be available at all or only to a few people, then write research articles for publication.
5. After his articles appear, there is a tendency for collectors and dealers to contact him to offer to sell pieces to him or to ask for more information on the niche. As this happens, he has uncovered a handful of numismatic discoveries, making it possible for him to publish more articles.
6. As a result of his published research, there tends to be an increase in the number of collectors of this numismatic niche, increasing demand for such items, often leading to higher prices.
7. When he feels that he has completed the goals of collecting this numismatic niche, he then sells this collection.
8. He then goes back to step one to seek out another interesting numismatic niche that seems to be insufficiently researched.
At any time, he may have as many as four different numismatic niche collections in process. He does not set a time frame for how long he will pursue a niche. Typically, his study and collection formation takes at least five years. There are collections that he has assembled for more than a decade.
One factor that he considers as to when to sell out is the prices at which pieces are selling. He sometimes has ended a collection simply because he could make a nice profit by liquidating.
Obviously, making profits with this strategy involves time devoted to research and establishing relationships with others. It is not a get-rich-quick scheme.
The founder of the company where I work told me decades ago that he would ask customers selling their coins to him whether or not they were making a profit. He observed that those who became coin collectors and seriously pursued the hobby for at least five years sold at a profit more than 90 percent of the time. In contrast, those who purchased rare coins and currency solely for the objective of making a profit, with no interest in becoming a numismatist, ended up losing money at least 90 percent of the time.
Patrick A. Heller was honored as a 2019 FUN Numismatic Ambassador. He is also the recipient of the American Numismatic Association 2018 Glenn Smedley Memorial Service Award, 2017 Exemplary Service Award, 2012 Harry Forman National Dealer of the Year Award and 2008 Presidential Award. Over the years, he has also been honored by the Numismatic Literary Guild (including in 2021 for Best Investment Newsletter), Professional Numismatists Guild, Industry Council for Tangible Assets and the Michigan State Numismatic Society. He is the communications officer of Liberty Coin Service in Lansing, Michigan and writes Liberty’s Outlook, a monthly newsletter on rare coins and precious metals subjects. Past newsletter issues can be viewed at www.libertycoinservice.com. Some of his radio commentaries titled “Things You ‘Know’ That Just Aren’t So, And Important News You Need To Know” can be heard at 8:45 a.m. Wednesday and Friday mornings on 1320-AM WILS in Lansing (which streams live and becomes part of the audio archives posted at www.1320wils.com).
