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Trader Interviews

Mark Ferguson: Why Everyone Should Invest In Coins

By Lisamarie Lamb on May 23, 2021

Reading Time: 5 minutes

Mark Ferguson is a rare coin collector and contributor to the Rare Coin Market Report. As an expert in this arena, Mark is well-placed to discuss just how this hobby can pay when you go about it the right way and consider it to be a solid long-term investment. No matter whether you’re a beginner or you’ve been collecting rare coins for some time, this sensible investment idea appeals to many.

Key Takeaways

If you’re looking for an alternative to stocks and shares, rare coins are ideal – they’re tangible, fun to collect, and can be worth a lot of money

Rarity, condition, and the grade of the coin are all crucial when it comes to determining value

Make sure that if you are having coins graded, or buying graded coins, the grading has been carried out by a professional grading company.


Why did numismatic appeal to Mark?

Mark has been fascinated with rare coins since childhood, and he has seen it all. There has been a revolution in the rare coin industry of late, and this is said to be down to Mark and the company he consults for.

Investors are becoming interested in coins…

Mark Ferguson knows that coin collecting is the ideal alternative investment to traditional investments like shares, stocks, even cryptocurrency. What makes it great is that it’s tangible.

These coins can be held, counted, hidden away in a safe deposit box. As they are not virtual it feels that much more real. This makes people pay more attention and take things that much more seriously.

What drives interest in coins?

Interest in coin collecting waxes and wanes. It often depends on the state of the stock market in general – if the stocks are doing badly, people start to look around for other places to invest, and coins are a good choice.

When stocks are doing well, people tend to go back to them, probably because they are more widely understood. Mark Ferguson saw that the pandemic renewed interest in rare coins. This was probably because they are tangible, rather than something virtual that can change direction at any second.

A coin’s value comes from its rarity

When it comes to determining a coin’s value, rarity is obviously important. However, condition also has to be taken into account. This is what PCGS (the Professional Coin Grading Service where Mark Ferguson works) looks into.

There is a grading scale that the coins have to adhere to. The score they get will determine their value to a great extent. Even so, if the coin is not a popular one that many people would want to collect, it won’t matter how rare it is or how good the condition is, it won’t be worth as much as others.

Why ‘treasure assets’ are popular

As global wealth rises, collectibles are getting more interest. Many wealthy investors have always put a certain percentage of their investment capital into ‘treasure assets’. (Assets that might be considered a hobby or passion, like coins or baseball cards or rare wines).

This might not even be a conscious decision; it’s just something they enjoy. It’s not necessarily something they are considering for monetary value, it’s for fun. The fact that it can make money is a bonus.

What beginners should focus on

Mark Ferguson has some tips for those who are looking to start collecting rare coins. To begin with, get an advisor. You need someone you can trust and who has a great deal of knowledge about rare coins. This will help your money go further.

When it comes to new coins, the ones you see advertised on TV or in magazines, don’t think of them as long-term investments – they’re not rare enough.

However, because this is a passion hobby, if you like the design there’s no reason not to buy them. Just don’t expect to make a fortune with them. Vintage coins or even paper money are much better if you want to make money.

How you can take your coin investing further

Many people choose to buy coins made of silver or gold because they know there is an underlying value in the metal itself. Mark Ferguson suggests there are ways to refine this strategy. One of the best things you can do is to learn more about how to grade coins and why they are rare (or not).

Essentially, do your research. There are magazines, videos, and plenty of other ways to research this. It is crucial that you do if you want to know why coins are rare or otherwise.

Using a professional grading service is important

Mark Ferguson says that grading a coin is important, although it’s wise to choose the right grading service. There are many copycat grading services, not all of them legitimate or good at what they do.

If you want to have a coin graded or if you want to buy graded coins, you need to use a professional, qualified grading service like PCGS.

When something is graded and certified by a recognised company, it gives people confidence. The prices will often be higher, especially as these coins are much easier to sell than something that isn’t graded or that has been graded by a less well-known grading company.

How you can get started

When you’re just starting out collecting rare coins, it can sometimes be rather overwhelming. There are so many options and so much to think about. Mark Ferguson suggests that the best thing to do is stick to one historical era. This can be a time you’re interested in, and even one country of origin.

It is just not possible to collect one of everything, so rather than trying to do this narrow your search down. It will be more fun that way. Plus it is the best thing to do if you’re collecting coins as an investment.

Selling collections is more profitable than selling one coin, and a helter skelter approach won’t be any help in the long term. If you are more focused you’ll do much better.

Conclusion

If money were no object, Mark Ferguson would consider the best long term investment to be something you’re interested in. There’s no better way to make money and have enjoyment in the process.

Mark Ferguson can be found at www.mfrarecoins.com

 Questions

  • So why should people invest in traditional coins?
  • With the exploding popularity of crypto currency and the launch of virtual coins on various exchanges on what almost seems like a daily basis, has this diverted attention away from traditional numismatics or coin collecting in general?
  • What factors influence a coin’s value?
  • Coin investing/collection can often be a minefield to newbies, with so many different types, nationalities, grades, opinions on what grade it is… what key pointers can you give them to get started?
  • Many people typically like to dip their toe in the water by buying gold coins like South African Krugerrands, British sovereigns or The American Gold Eagle, secure in the knowledge that their value is determined by the underlying value of precious metals. For those who deploy such a logical strategy, what could they do to refine it?
  • Which coins tend to make the best long-term investments, irrespective of their base metal?
  • Would you say that hybrid coins which are made of both previous metals and have historical value (ie: from a significant year) make better investments?
  • Now you represent PCGS which regarded as a top-tier grading service which goes to great lengths to accurately and fairly attribute the correct grade to a coin. However, for those listening and perhaps new to numismatics, what key signs can they look out for to spot a fake?
  • Is there much variance in the value of a coin that has been professionally depending on which company graded them?
  • Coins that have been officially graded and slabbed by an authorised company like PCGS will be fixed in plastic casing stating their grade and a serial number. However, given that coins can often last in collections for decades, would the potential corrosion of plastic over time represent a threat to the coin?
  • Would you say that the relationship between a coin’s value and its grading over time is generally a positively correlated, linear one?
  • The million-dollar question: what coins do you consider to be the best long-term investment?
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Lisamarie Lamb

A prolific writer in her own right, Lisamarie brings to the team her unique ability to vividly turn dry and often complex subjects into life, making financial education a more fun and accessible experience for all

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Lisamarie Lamb

A prolific writer in her own right, Lisamarie brings to the team her unique ability to vividly turn dry and often complex subjects into life, making financial education a more fun and accessible experience for all

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