Collectible Gold Coins Show Ups and Downs of Antique Prices

By Dave

May 4th, 2008

In an example of how certain categories of antiques and collectibles can rise and fall quickly, the market for gold coins is undergoing gyrations because of volatility in global commodity prices for the precious metal, according to a recent Wall Street Journal article.

Double Eagle Collectible Gold CoinsBecause of the runup in the price of gold over the past year, many speculators have jumped into the gold coin market, hoping to use these coins as a bet on the price of gold, or a hedge against inflation. But when the price of gold dipped in the past month, the values of many gold coins sank quickly. And many older collectible coins, according to the article, are trading at only slightly above thir “melt value,” or the value of their gold content if melted down.

This despite the fact that experts say older, rarer coins tend to hold their value better when the price of gold falls (because they still have collectible value). But that didn’t happen this time.

The recent ups and downs in world gold prices have created a couple of other phenomenon: the rise of fraudulent schemes where companies advertise and sell “layered” gold coins with little actual gold content at high prices; and the softening of the market for traditional collector coins such as the $20 Double Eagle (shown here) as investor attention focuses on the new U.S. Bald Eagle commemorative coins and similar issues from other countries.

Moral #1 of the story: antiques and collectibles values can rise and fall, often for reasons you can’t predict in advance. Moral #2: be sure to be clear on why you’re collecting. For the fun of it or as an investment? Ideally it would be both, but recall that over time many categories of antiques and collectibles have lagged the overall market, while others have done quite well. And in either case, there can be long periods when values can be either very up, or very down.

The Collectors Weekly doesn’t yet have a coin section, but if you’re into coins you may also want to take a look at our currency and stock certificates pages.

One comment so far

  1. Nei Says:

    Gold values are like a yo yo at the moment but pundits predict ‘a boom’ is on its way. Nevertheless to own gold artifacts regardless of their age has a magnetic appeal.
    I started collecting seven years ago when prices had risen and the thought of making ‘ a quick buck’ was my only aim. Now as time goes by I am buying more and selling very little. I am really struggling to let go of items which now have doubled sometimes trebling in value not only in their intrinsic value but because a huge proportion has been melted down and lost forever regardless of it antiquity strength.
    I admit that while gold value is high the gamble of owning gold becomes less and if the prices do slump you can move it on quite quickly to protect your investment.
    Another factor in owning gold (especially jewellery) is it can be displayed, worn and admired by all. I suppose you can do that with hard cash (apart from wearing it) but it will never be the same. Neil

Leave a Comment or Ask a Question

If you want to identify an item, try posting it in our Show & Tell gallery.