The Learning Curve Has Shortened: How the “Information Age” Has Investor and Collector Confidence Growing at an Unprecedented Rate.
by Adam J. Crum
As evidenced by the auction results of the past nine months, it is easy to understand that the market for rare coins has once again taken off. To a certain degree, I attribute the emerging market trends to the strength of the U.S. economy, but this is only part of the story. In the next few paragraphs, I am going to explain the most compelling, as well as overlooked, trend that may make your collecting and investing in rare coins much easier, intriguing and profitable.
INFORMATION and How It Is Lifting Demand!
Although wisdom rings true in the old clich, “knowledge is power”, it is also painfully true that a “lack of knowledge can result in financial suicide.” That is especially true when it is time to make an investment in rare coins. Although I have watched our industry make tremendous headway in conveying accurate and timely information to consumers, I have at times been very frustrated by the lag time for information to be produced and delivered to the public.
Over this past year I have been involved in, as both a close observer and consultant, some of the most exciting information technologies that have ever been developed in the rare coin industry. When I consider the time it used to take to research a particular coin, my appreciation for the information now available at the push of a button is immense. I used to spend hours compiling data such as previous high/low bids, auction results, survival data, minting data just to name a few. But today with email, the Internet and specialty software providers, if I am trying to decide whether to buy a coin I can find more information than I need to know in a matter of minutes.
This “High Tech” world has provided the means for far-sighted entrepreneurs to capitalize on the data needs of rare coin collectors and investors. And the new available database is helping rare coin investors and collectors to avoid many of the mistakes of the past. This, in turn, has fostered a steadier flow of capital investment into the market, profoundly increasing demand.
Today’s easy access to pricing data from sources like Coin World Price Trends, Intelliquote, CU3000, Numistech, NumisMedia, monacorarecoins.com and even magazines that can be purchased at your local bookstore has helped lift consumer knowledge and confidence to unprecedented levels. I continue to be impressed by the level of education that new collectors and investors are able to gain in a relatively short period of time. I am also firmly convinced that the future of our industry has been greatly enhanced by this new age of knowledge.
Many of the information sources mentioned above provide valuable statistical information such as population and survival rate (even in various grades), previous auction results, past high/low price levels, and coin pedigrees. This intriguing information is helping many to clearly understand the benefits of owning truly “great coins,” as opposed to more common or generic coins. It also helps to explain why accelerating demand for high-end rarities is pushing prices higher and causing the market for these “great coins” to become very crowded.
Although I have talked about this trend since the late 1980s, it is just now becoming mainstream discussion in major coin publications. In a recent issue of Coin World Magazine, for example, there was an article titled “Rarities Are In and Generics Are Out” that addressed this very trend. (The fact of the matter is this article should have been written 10 years ago!)
Nevertheless, this new age of information is still in its infancy and these trends may not even be seen by the masses for another couple of years. I recommend you look to our “Y2K Top Picks” as a source of information on great coins with prices that have yet to be dramatically affected by the new information resources.
Although the current bull market in rare coins is going into its second year, I believe the next several years will be full of tremendous opportunities. I also believe that the growth being fueled by the new information technologies will be a source of new business that will help send coin price levels far, far higher!