Great Buys of Under $100
Are we just playing around?
How is anyone going to make a significant and successful investment in rare coins by buying the cheap stuff? The answer is simple. If owning one of these coins is a good idea then having a dozen is twelve times better.

It's seldom mentioned but only a small percentage of those who actively buy coins make single coin purchases valued at $500 or more. Looking at the Canadian coin marketplace, I'll play it safe and peg that number at less than 10%. My experience has been that Canadians still consider coin collecting to be a hobby. They are passionate about the activity but cautious. I can envision a tremendous growth in interest. What I can't see happening in Canada is a substantial and widespread growth in discretionary income.

Right now, interest in expensive Canadian coins is strong and yet confined to a limited number of participants. If this interest expands it will be primarily due to an influx of collectors and investors from outside Canada. In my opinion making investments based on increased interest and demand among domestic coin consumers is the prudent thing to do.

The 1926 Five Cents
Once again I can't resist to pick one of the obvious key issues in a short and highly collectable set. In my opinion, the 1926 Far 6 is an insignificant variety that few people who collect this series would care about were it not blended into the reference book listings. It's easily a coin one can do without but the Near 6 variety is a necessary date if you want a complete collection. This coin is an excellent acquisition in all grades up to and including Very Fine. Like some of the coins I mentioned in Part I of this article, the 1926 Five Cent can be lots of fun to acquire with the intention of building a nice holding of these pieces. While everyone else is chasing the 1925 and 1926 Far 6 you can be finding some nice coins at reasonable prices. The key is to be discriminating and avoid coins with scratches or other problems. When it's time to sell you want every coin you own to be a “perfect” example for the grade.

The 1858 Ten Cents
This coin is grossly undervalued in grades G through F. If you avoid examples with problems and or cleaning every coin you find will be a wonderful purchase. Investors should have fun and enjoy the hunt while acquiring coins that are primed to increase in value. If you think the 1858 is easy to find you are in for a surprise. Like many of my recommendations, it's much more a matter of locating the coin than figuring out how to pay for it.

A Few Words About Collecting Varieties
When coin collectors start to get bored they begin collecting varieties. The person who is buying coins as an investment can't afford to make this same mistake. I'm not suggesting you ignore varieties. If your knowledge of varieties enables you to buy a scarce or rare variety for the same price as a common coin then you've done well and should immediately dispose of your find and enjoy the profit. Without exception, varieties don't belong in an investor's holdings. There are simply too many good values among standard coins that will appeal to mainstream collectors. Leave the varieties to the collectors and fast buck operators.

The 1911 “Godless” Coinage
When you decide to omit reference to God from your coins you could be in trouble. In 1911 the cent through fifty cent coins produced for Canada all lacked a reference to the deity. It was replaced in 1912. As a result we have a tidy little set of five one year type coins that properly belong in any complete type set collection. It's important to remember that many numismatists around the world collect Canadian coins by type and these 1911 issues are hard to ignore. The “godless” coins are well known and none can be considered a “sleeper” at current price levels. Building the cent through fifty cent sets in problem free circulated condition has to be an excellent way to enjoy the hobby while making a sound investment. The target grade for nicely matched sets would be Fine condition. This would keep the cost of the fifty cent piece at comfortably under $100.

Avoiding the Grading Service Obligation.
Here is a recommendation you can take to the bank. Never buy uncertified coins (often called “raw” in the trade) thinking that sending them to a grading service will enhance the profitably of your investment. Submitting coins to a grading service is costly, time consuming and at best unpredictable. Even the most experienced experts cannot always predict how a grading service will react when viewing a certain coin. Many coins in grading service holders may prove to be excellent investments. It is always best to buy these coins in the grading service holders.

The 1938 Dollar
I like the 1938 dollar in the circulated grades up to and including EF. The 1935-1967 group of silver dollars is by far the most popular of Canadian coin collections. This date is still affordable enough to be included by the casual collector. Other dealers probably have had the opposite experience, but I've never been offered a substantial holding of 1938 dollars. When building circulated grade sets it always seems to be one of the last coins to come along. I'd love the opportunity to buy 100 problem free and uncleaned examples. I'm confident many other dealers would be delighted to acquire such a holding.

The Investor & Ebay
Not that long ago the well informed investor expected to encounter a coin dealer when they made purchases and again when they sold. Now that electronic trading venues are well established the modern coin investor might contemplate using one of these services to avoid the dealer and sell directly to collectors. I think this is a remarkably poor strategy for most investors. Before deciding you will use the electronic trading method to sell your coins it might be wise to seriously investigate the mechanics of the selling process and do a time study. My experience has been that selling via electronic auctions involves a tremendous amount of work. It all boils down to how you value your time. It would seem if you have the discretionary income to invest in coins you probably aren't very interested in working for five dollars an hour to sell them.

Getting Acquainted With The Marketplace
In one dealer's hands a certain coin can be easily sold for $50,000. If another dealer owned the same coin they might be lucky to find a buyer willing to pay $20,000 for the thing. All sellers in the coin market don't have equal access to the best customers. The most common mistake coin investors make is failing to investigate the selling side of the marketplace before jumping in on the buying side. To use a timely catch phrase, you need an “exit strategy”. How are you going to turn the bargains you've acquired back into cash?

The surest way to determine if you are making the right investments is to try to sell some of them. This should be done early on and be repeated at regular intervals. Trying to sell doesn't mean you must sell. It can just be considered informative practice. If you do some practice selling you may reach the proper conclusion that your marketplace may be far different from what you anticipated. The time to figure all of this out is while you are buying, not when it is time to sell.