Key Factors That Affect The Value Of Collectible Coins

collectible coins

If you are an avid coin collector, you will probably the complexity of the coin market. Obviously, every coin is minted with a specific face value but once it comes in the category of collectibles, the value exceeds manifold. In fact, collectors may be willing to pay several times the face value of the coin is it meets the right criteria.

Whether you collect rare coins as a hobby or a long-term investment, you need to understand the factors that influence the value of collectible coins so that you are not taken for a ride. Here are the criteria that you need to know about.

High demand

Anything that is rare is in high demand and vice versa and this applies to collectible coins as well. Like any other commodity, there is a direct relationship between the demand and price of collectible coins. An increased demand among the general public as well as the numismatic community will probably lead to a rise in the coin’s value. This usually happens in case of old coins as they are hard to acquire and everybody wants them. The demand also goes up when coin dealers run marketing campaigns to popularize their offerings.

Mintage

Like demand, supply is another vital factor that influences the value of collectible coins at any point in time. Obviously, anything that is easily available tends to command a lower price as compared to something rare. The total possible supply of any type of a coin in the market depends on its initial mintage. More often, a coin dies at the end of the year because it is not minted anymore. Thus, its supply becomes fixed at a certain point in time, which influences its price.

The intrinsic value of the metal

Some coins are desirable and pricier just because of their intrinsic metal value. Obviously, a coin that has a high content of gold or silver will command a higher value as compared to those with less of the precious metal content. For example, the junk silver coins, such as U.S. half-dollars, quarters, and dimes which were minted prior to 1965 are 90 percent silver. The high silver content makes them worth more than their actual spend value. This makes them a good long-term investment as collectibles as you may subsequently melt them down for their high silver content.

Surviving population

Coins that are overly worn out and damaged are removed from circulation, which means that their surviving population is limited at any point in time. The lesser the surviving population of a coin, the rarer it becomes and the higher value it commands. You can check out these super rare coins and you will probably not be able to find them anywhere in the market. Except for just a few people and coin collectors who may have saved them, there is no chance of getting them from anywhere. All this because they are very rare, with a surviving population that can be counted on the fingers!

Grade and condition

When you think about the value of any collectible coin, you cannot forget to consider its grade and condition. Essentially, the condition of a coin is determined by grading and its grade determines its value. A coin with a perfect mint grade has a much higher value than an identical one which has just a small blemish.

Attractiveness, color, luster, strike, and preservation of the coin are the criteria used to determine its grade. Often, coins are certified by third-party grading agencies to determine the grade in an unbiased manner. When you buy a coin as a collectible, be sure to choose a certified one and check its grade as well.

Unique history

A more unusual factor that determines the value of a coin is its unique history. A coin that may otherwise be worthless just becomes rare and high-value collectible because it has a historical significance, such as being traced back to a renowned ruler or some great event in history. The coin need not be ancient to be valuable from the historical perspective; rather it has to be one of a kind!

Now that you understand the key criteria that determine a coin’s value, buying them at the right price will be easier. Besides keeping a close eye on these criteria, be sure to buy only from a reputed dealer or collector. Whether you are a newbie or a seasoned collector, be very sure to pick pieces that deserve to be valued rather than pay for ones that are worthless.