From the July 2001 issue of ACCent, the newsletter of the Anchorage Coin Club:
You Want To Hoard Coins? Here Is A Suggestion.
Hello to all you coin hoarders out there! Yes, I know there are some of you out there, trying to buy up all of the available supply of one or several coin issues. You will not see very many articles, especially positive articles, about how to hoard coins. My point of view is that if you have chosen coin hoarding as your method of collecting, have fun with it and good luck making some profit in your endeavor.
Most individuals who chose to hoard a specific issue are doing so with the hope of accumulating a sizeable percentage of the surviving coins, thereby moving the price higher because so many coins are now off the market. In general you can either focus on a common issue, in which you have to buy a lot of coins but each one is quite inexpensive, or you can look at a much scarcer issue where you have many less coins to buy but each one will set you back a not insignificant amount of money.
For example, you may choose to focus on 1945 mercury dimes. You can purchase just about as many as you could ever want for one dollar or less in average circulated condition, but it will take a huge quantity of them before you actually own a material percentage of the surviving coins. On the other hand, if you decided to hoard 1857 large cents, there are far fewer of them in existence and not many on the market at any one time. However, they will run from $20 to $75 each for circulated coins.
So, what about my suggestion? Kind of right in the middle. With a coin that is too common, like the above mentioned 1945 mercury dimes, there are just so many around that an individual could never hope to get enough of them to really dry up the available supply. Otherwise, something else like 1844 seated liberty dimes, will deplete a typical personís funds in short order at $150 to $850 for circulated specimens.
My suggestion for hoarding would be your choice of any of the mint marked issues of buffalo nickels from 1913 type two through 1919. I think any of these fourteen issues would be an excellent hoarding candidate, and here is why. Mintages are moderate, not so low that they attract attention as key dates, but not so high that the market is flooded with these coins. Values, too, are moderate, generally ranging from about five to fifteen dollars a pop in the lower circulated grades up to as high as $150 in higher circulated grades.
Often, part of the reasoning behind hoarding is to cause a coin to appear more scarce than it really is, thereby causing a price rise. A price rise really does not help much if the coin you hoarded has limited demand. Therefore, it is essential that the hoarder focus on a coin that is in heavy demand. And buffalo nickels fit the bill well in this department. Their design is one of the best recognized and most famous of all American designs. If you donít believe me, ask almost any non collector if they are familiar with the buffalo nickel and you will almost always receive an affirmative response. Try the same question using the Liberty head or shield nickel and you can expect a blank stare. Buffalo nickels are very heavily collected by both beginning and advanced collectors.
We are all familiar with the propensity of the date to wear off buffalo nickels with startling rapidity once they enter circulation. This caused a substantial percentage of the original mintage of the early date buffaloes to lose their dates to become merely the ubiquitous dateless buffaloes which are readily available by the bag. Some people restore the dates of these nickels using chemicals that are readily available, but these coins should only be purchased if they are available at a huge discount to the Good price. Similarly, beware of buffalo nickels advertised as a scarce date which have so much of the date worn away that it is difficult to tell if it really is the date which you are purchasing.
Can you make a profit hoarding these nickels? Quite possibly. These coins do not fly up in value but they seem to steadily crawl on up, and rarely dip down. Once the value increases to a level such that you wish to cash out, this too would be no problem. Go to most any dealer of any size with a group of early mint marked buffaloes and they will eagerly purchase the whole lot. These coins just do not walk through the front door very often, and they are easy sellers. You just do not find dealers who are overstocked in these items, particularly in the average collectable grades of Good through Very Fine.
So, to summarize, the early mint marked buffaloes make excellent hoarding candidates because:
1) Original mintages are low, but not so low that they attract lots of attention as key dates. For several of the dates, the entire original mintage would fit in a small closet.
2) Survivorship is very low. The dates wore off buffalo nickels very quickly and their heavy use in circulation means that these just no longer exist by the truckload.
3) They will not cost you a fortune on a per coin basis, at least not in circulated grades.
4) When the time comes to dispose of your hoard, the popularity of these coins combined with an almost universal need among dealers to get more of them in stock means that you will be able to sell quickly and at a fair price without much difficulty.
There are not too many coins that make good hoarding candidates, but these fourteen early mint marked buffalo nickels seem to have many of the attributes that a person should be looking for. So if hoarding is your game, consider these early buffaloes for some potential profits.
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