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There’s an old saying that reminds us not to “put all your eggs in one basket.” If everything you have of value is in one place, whether that be monetary investments or even personal improvement efforts and career choices, you risk losing everything you have at once.
For your personal investments, it is important to change things up, and one great way to do that is by collecting foreign coins. To see some of the most unique foreign coins that won’t break the bank just click here.
Why Invest in Foreign Coins?
Most people have investments in the stock market, in bonds, or in real estate. While these are all solid investment options, investing in valuable coins is another great way to diversify your investment and make a solid profit.
Coins often appreciate in value, particularly if they are issued by a particular mint or have reached a certain age. Coins with high percentages of valuable metals in them, like gold and silver, also tend to increase in value when other parts of the economy—paper money in particular—are on a downturn.
What Are Foreign Coins?
Foreign coins are pieces of money issued by countries other than the United States. These coins may be a part of the regular monetary system of a country or they may be a special issue.
For example, in the United States, the basic coins in circulation are quarters, nickels, dimes, and pennies, with a few dollar coins, too, but the United States also mints “bullion coins” and commemorative coins which are often worth more than their face value. Bullion coins are not in regular circulation and are made of silver, gold, palladium, or platinum.
Their face value may be anything from one dollar to one hundred dollars, but they are usually worth more than this for the value of the precious metals they contain.
Many other countries do the same, so there are lots of foreign special issue and bullion coins available that make fine investments. Modern foreign coins that are in regular circulation and not made up of any precious metals have little to no value.
The exception is coins minted in the 19th century or earlier. Otherwise, look for foreign bullion or special edition coins.
Examples of Valuable Foreign Coins
The three most valuable foreign coins of all are:
- The Edward III six shilling coin
- Umayyad dinar
- Queen Elizabeth II coin
The Edward III six shilling coin was minted in the fourteenth century, but they stopped minting it after less than a year. This means the coin is rare, and there are only thought to be three in existence. Each one is worth about $6.8 million.
The Umayyad dinar was minted in the eighth century by the Islamic Umayyad kingdom. There is only one of these in existence, and it is part of a precious collection of some of the first official coins minted by a country or government.
The Queen Elizabeth II coin was minted in Canada and is made of 99.99% pure gold. The face value is $1 million, but because it contains 220 pounds of fine gold, the actual value is far higher. The value varies depending on the price of gold. It is worth more than $3,800.000 at the time of this writing.
How Valuable Are Foreign Coins?
Naturally, it is unlikely that most of us will ever own one of the coins listed above, but it is still possible to make good investments in foreign coins and to make money off them. To do so, there are some things you must remember.
If you’re serious about investing in foreign coins, you must know what you’re doing. You don’t just buy some coins and then throw them into a jar. You also can’t assume that just because a coin is foreign that it has tremendous value. You need to learn which coins are most valuable and how to recognize a good one.
Mint and Age
The value of a coin will often depend on age, the metals it contains, and which mint produced the coin in question. It will also depend on the trustworthiness of the issuing country. South African krugerrands, for example, are well-known to be trustworthy.
The same is true of British gold sovereigns. On the other side, the world is quickly realizing the enormous problem of fake Chinese gold coins.
Another issue with foreign coins is the collector value. Often a collection of coins is worth more than the sum of its parts, and this means a collector may give you more than a coin is worth if it completes a valuable or important collection.
Where to Learn
To begin your education on the value of foreign coins, most collectors will recommend you get an up-to-date edition of the Standard Catalog of World Coins, published by Krause Publications. Even if you only have an older edition, you can still get an idea of a coin’s value by comparing it to other coins in the book.
While the price of coins will change, their value relative to one another will not. It’s also worth looking at Numismaster which is a database regularly updated by Krause Publications. There is a fee for subscription to the site.
Google is another valuable search tool since a quick online search will easily turn up a trustworthy list of the most valuable coins on the market and tips for how to identify them. The Numismatic Guaranty Corporation has a free World Coin Price Guide which is available on the internet and is supposed to be based on the information from Numismaster.com, but it’s not as comprehensive.
Getting the Most for Your Investment
You can trade in coins, sell them at auction on eBay or a similar site, or deal directly with a collector. If you trade a coin in to a coin dealer, the dealer must then sell the coin. He or she cannot sell it for much more than market value, so to make a profit they will have to buy from you at below market value.
On eBay it’s possible to get much closer to market value, but if you have a relatively common foreign coin, you are likely to be undersold by people willing to accept less. It can also be difficult to find the actual going price for coins that are more rare.
The best way to get the most for your coins is to deal directly with collectors. This can get tricky, though, especially when you’re dealing at a distance or with someone who wants to use a credit card. It’s usually a lot easier to work with a coin dealer until you have experience and make some personal contacts among collectors.
Are Foreign Coins Worth Collecting?
Even common coins have trade value, but the true value of a collection isn’t in profit. Yet there’s also something to holding a piece of culture and enjoying the beauty of the world’s money which is a worth it is much harder to put into words. The things that a country thinks is worth memorializing on the face of their coinage tells you something about what the culture values.
If you want to make money, however, collecting foreign coins is really a long game. It can take years to build up a valuable collection, and it takes diligent application to keep up with how to get the best value for your coins.
How to Make It Worth Your While
If you really want to make money off your coin investment, however, there are three ways to go about it. You can focus on the metal, work on the age, or build up a collection.
If the metals are your focus, you want to buy when prices are low and sell when they are high. When the economy is roaring, the price of precious metals drops. That’s the best time to buy. When the economy is doing poorly, the value of precious metals rises. This is the right time to sell though some people hold on to their precious metals in case the economy does too poorly and paper money becomes worthless!
If you focus on the age of your coins, you want to look for coins that are likely to age well and plan to hold on to them for as long as possible. This is a great investment for passing on to children or grandchildren.
To do this, you need to look for rare coins. Any coin that has a minting error, for example, is usually worth more than other coins with the same face value. The older that coin grows, the more likely it will become rare.
The final way to make sure that your coins have value is to always look for ways to build up complete collections. These are often worth more than the face value of the coins that comprise them.
Collecting foreign coins can be a rewarding endeavor on several levels, and with some careful thought, research, and planning, it can be a valuable investment. The first step is to educate yourself. Once you have, get out there and get collecting!