When you start coin collecting, it’s best to focus initially on bullion value. Though investing in rare coins can be very profitable, it is more difficult to gauge what the collector market for a particular coin might look like five or ten years down the road. Investing in modern bullion coins, such as Canadian Maple Leaf silver coins and American Gold Eagles, is a great way to get started. These coins all contain high-grade gold or silver, making them excellent precious metal investments. At the same time, they’re also handsome coins, which is an important factor for any coin collector.
Some older coins can be good stores of bullion value as well, though in some cases there’s also some numismatic value involved in the price of the coins. For example, American quarters and dimes minted prior to 1965 contain 90 percent silver and are frequently purchased by coin investors for their metal content. Ordering a mixed bag of junk silver coins is a good way to fill out missing dates in your collection while simultaneously investing in silver metal.
Some coins, such as American silver dollars, exist somewhere on the borderline between being bullion investments and numismatic investments. These coins are common enough that they don’t have immense amounts of collector value, but at the same time, they sell for prices that are higher than their raw bullion value. These coins aren’t necessarily the best investments from a growth perspective, but they do hold their value reasonably well. Since coins that fall into this category tend to be older, they’re also a great deal of fun to collect for those who love the historical appeal of numismatics. Pre-1933 gold coins also fall into this category, though their bullion values are of course much higher than silver coins.
Finally, there are many coins that are predominantly numismatic investments. Though the bullion value of the metal is still factored into the overall price of these coins, their scarcity causes their collector value to make up the bulk of their final cost. If you wish to invest in coins predominantly for their collector values, it’s important to know exactly which coins will be most in demand among collectors.
Typically, rare dates and mint marks are two of the largest contributing factors to a coin’s numismatic value. Rare minting errors can also add to the value of a coin. If investing in coins purely for their numismatic value, it’s important to deal in certified coins only. Certified coins are those which have been inspected and graded by a recognized organization, then placed in a protective holder.
One last factor to keep in mind is that, contrary to popular belief, a coin doesn’t necessarily have to cost thousands of dollars to be a good investment on the basis of its numismatic value. One of the best examples of an affordable coin that is mostly valued as a collector piece is the 1950-D Jefferson nickel. Considered a key date and mint mark pairing, a 1950-D nickel can sell for $70 or more in uncirculated grades. Though extremely high compared to its face and bullion values, the numismatic value associated with this coin makes it reasonable for collectors on a budget. Source
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