A US silver dollar this month sold for over $3.8 million at auction; made for President Andrew Jackson to give as a diplomatic gift in the 1830s (and stamped with an 1804 date, due to a lack of new die equipment), it’s a spectacular sale for a single coin.
But what makes this coin and others like it sell for such astounding premiums? There are several factors that contribute to the high value of rare coins, and the “X-factor” they carry is built on, to steal a metaphor, a stool with three legs: condition, notoriety and rarity.
Condition is easily understood; collectors are impressed with coins that have a few years behind them, but more so when the coin has clearly been cared for — or better still, simply left alone to be in the condition it was when it was minted. Coins are like time machines, and it’s fun to imagine what life was like when a rare, old coin was created.
And every collector “gets” the concept of rarity; the more scarce something is, the more it’s worth to people who want it. Numismatic coins are just like every other collectible in this way, less is more, so to speak.
But that “notoriety” stool leg? That’s the X-factor, the unknown that’s sometimes impossible to predict — and impossible to miss when it’s happening. Usually it’s attached to a coin that has a great backstory, a history that captures the imagination of coin collectors — and, sometimes, the press.
Understanding rare coins (and the X-factor they carry) can be complicated; for more information about numismatic investing, contact us today.
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Bullions And Coins 