Coins We Love: March Market Update
While overall the action in the wholesale coin market (dealer to dealer trading) is relatively quiet, the opposite can be said about collector-based transactions, online auctions, and retail. Although we’ve seen the coin market become far more active during the pandemic, it’s been nothing compared to the boom in trading cards and other modern collectibles where there's been an increase in market values of up to 500% in a 12-month period. Coins have historically had a more measured reaction to markets as the numismatic hobby is a bit more “mature”. However, in the last 2 months the coin business has taken an already increasing trend to additional heights.
When I talk about auctions, I’m essentially discussing internet auctions as live auctions aren’t really occurring at this point (I wonder if onsite auctions at shows will be a thing of the past now that everyone realizes that the action is from collectors at home…that’s another story for another day though). So, the action that we’ve seen occurring in our internet auctions we thought was an anomaly at first compared to the overall market. But now we’re seeing it take hold elsewhere and the auction prices are starting to actually lead the market.
The coin market goes through cycles and sometimes Auction House A will trend as the best auction house to buy coins at their cheapest rates for a while…then it trends to another…However, when the overall auction market starts to lead the coin economy as a whole, it changes the entire outlook of values. I believe we’ve entered into this type of market currently and as an active buyer from many different sources, I find myself leaving auctions alone now as the deals on quality coins are now lacking. That being said, it’s certainly not much easier to buy wholesale right now. The absence of travel, cancelled coin shows, and some dealers going dormant at this time have dried up much of the supply. Perhaps this has something to do with the auction market taking the lead in prices realized as well.
So, what’s the biggest problem with the large auction houses? Getting paid in a timely manner and making sure your coins don’t slip through the cracks. That’s why we’ve decided to start advancing funds on Guaranteed Auction Program consignments. When the collection is over $10k in value, we’ll prevent the coin from slipping through any cracks by giving you a guaranteed amount, and we’ll give you the guaranteed funds up front. It makes it quick, simple, and easy. As they say, “necessity is the mother of invention…” This is what collectors want, so it only makes sense to provide this service.
As long as the supply exceeds the demand in this marketplace we’ll see new eyes getting into the hobby. It certainly has an energy that’s been missing for 15 years. And now that the demand is taking over, this is when you start to see the market take on a lot more attention and it could become far harder to find things that are good value. With this in mind, we’ll keep on knocking on all of the doors we can find in our search of quality coins for collectors. The market is certainly changing, but adapting to these changes is what makes this business so fun. We are fortunate to deal with beautifully artistic pieces of history, but the current marketplace of buying and selling quality certified rare coins makes it a tougher challenge. Understanding the coin market is always clearer in hindsight, but for now we will continue riding the swelling wave of interest and activity.
Thanks again for reading and we hope that you find something below that’s of interest for you and your collection!
John Brush and Your Friends at DLRC
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