Rare Coins are an asset class that is not correlated to traditional markets. A great vehicle for long term wealth preservation and capital appreciation.
Non-Correlated Tangible Asset
The U.S. rare coin market is not correlated to traditional investments, fiscal / monetary policy or geopolitical events that can wreak havoc on markets. Due to the pure nature of being a rare historical artifact, these assets are coveted and owned by wealthy individuals who take great pride in being a custodian of such legacy assets, of which they are not typically looking to dispose. As a result of these powerful dynamics, price is dictated by a willing buyer and a willing seller if the owner is amenable to departing with such an asset. Unlike other investments that are subject to volatility, the combination of scarcity, holding power and strong demand for these assets among wealthy families assists in stabilizing, preserving and growing a small portion of one’s wealth. The U.S. rare coin market is supported by wealthy collectors and investors who have the holding power to comfortably own millions of dollars of rare coins. In the event of economic turbulence, these assets are typically the last investments that these individuals would ever want to sell. These individuals find it easier to liquidate other assets that they are not emotionally attached to as opposed to historical rarities that they may never be able to acquire again in their lifetime. In fact, rare coins are often kept off the market and in families’ estates for generations. For this reason, rare coins rarely flood the marketplace and volatility is minimal.
Wealthy families, investors and collectors have been investing in historical rarities for centuries to preserve wealth. U.S. rare coins add stability to one’s portfolio as these items are irreplaceable artifacts that will always be highly valued due to their historical significance, scarcity, and popularity among the affluent. Investors with holding power are in a strong position to preserve capital in all market cycles as they own intrinsic value not correlated to conventional markets or credit risks.
It is a fact that exclusive U.S. rare coins have a finite supply and high demand. Locating these rarities is a difficult challenge and it creates an environment for excitement where purchasing opportunities may only occur once in a lifetime. Ultimately availability becomes more important than price and the seller is in a very strong position to profit.
Rare coin firms are not required to report rare coin transactions, which are completely private. The buying and selling of coins goes very fast, is private and convenient.
U.S. rare coins, which are duty free in and out of the United States, are among the most portable high value assets in the world. Due to their small size, owners are easily able to move large amounts of wealth very quickly at any time. The coins are encapsulated and hermetically sealed in plastic by third party certification companies that guarantee authenticity and condition. This provides a safe way to travel without the concern of damaging the rarity and affecting value.
Professional Coin Grading Service (PCGS) and Numismatic Guaranty Corporation (NGC) grade and authenticate each coin, providing a financial guarantee for the accuracy of their service. PCGS and NGC also provide price guides compiled from independent sources across the numismatic community.
U.S. rare coins have a track record as a hedge against long-term inflation. Owning highly valuable, portable assets provides insurance for geopolitical risks or creditor protection where owners can transport wealth to other jurisdictions or safe havens. Finally, diversification into non-correlated assets can also serve as downside protection insurance during severe monetary events.