Numi's as a hedge

8 posts / 0 new
Last post
Blight Master
Blight Master's picture
Offline
Joined: 07/18/2011
Hat Tips: 480
Posts: 119
Numi's as a hedge

Anybody else into stacking numi's as a hedge against a major takedown?

I've found a wonderful profit opportunity that grows as the price of silver increases. It started for me with Kooks. They used to command a higher premium, some of the 90's kooks even went for 40-50 bucks when the price of silver was low. Well the price of silver caught up and has overtaken them. I get Kooks for a lower premium then ASE's now. While there isnt a lot of profit in kooks it led me to look at what other numi's prices will get overtaken by the price of silver. That's where I got my namesake from. Next I spread to any "cool" silver my LCS's had. I started getting Maples with privy marks, perth lunar stuff, and then, even pandas for spot  + 1.75. These things happen as the price of silver gains too fast for numi's to hold their value. I didnt think I had anything special until I hit Ebay and started checking prices. The thirty or so Pandas I'd paid about fifty bucks apiece for were selling in the hundreds range, with several pieces selling for over a thousand. I promptly started jumping up and down on the couch in a victory dance. I bought these solely for their silver content, and realized instant gains of 1000%+.  The perth mint stuff can sell for as much as well depending on the mintage.

The key here is to buy this stuff as silver, at silver prices. Most of the mom and pop silver shops dont like ebay, its a hassle and they especially dont have the time now because they are running full speed in the scrap and junk game. The downside is that what you buy may only be worth silver if tshtf... but I'm only paying silver prices now anyways. The other downside is possible fakes. Educate yourself, buy a loupe, learn mintage numbers, and there are huge gains to be made even if you do buy a fake or two by accident.

My last buy gave me the greatest clarity into the situation. I bought 5 1994 pandas for spot + 8 bucks and a 1991 piedfort panda for spot plus 1.75. After the purchase the guy told me I had good timing because he was just about to send them off to melt!? Total insanity but knowing his business model it makes sense. He didnt have the time to check the prices because he was doing too much business, he wouldnt have had time to find a buyer because he's doing too much business, so if it sits on his shelf for more than a week or two it gets sent off to melt.

Sure now if I want to flip them on ebay I have to send them off to get graded which costs more money and time but if I pull some ms 69's then I will have 1000% ROI. If the Piedfort pulls a 69 (which I think it will) then its a minimum thousand dollar coin that I paid 88 bucks after taxes for. If it pulls a 70 by some miracle then we're talking crazy money.

A reason I mention hedge is because these guys lost no value during the takedown. Will they hold their value over a longer takedown? I dont know. Will they gain in value if silver slowly marches its way higher and higher? Definitely. If we  ever reach a plateau I could see these guys continuing to rise as more and more people like me get bored with stacking generic bullion.

Edited by admin on 11/08/2014 - 06:09
lilbromarky1
lilbromarky1's picture
Offline
Joined: 06/15/2011
Hat Tips: 2464
Posts: 292
this is a good post.  i'll

this is a good post.  i'll have to keep an eye out for numees.   So 94 pandas are good.  What year kooks did you do well on?

Also, do people nitpick the condition on ebay?  I dont know how to grade coins and I think that might stop me from doing what you do

__________________

Like my ideas? Check our blog at: http://backtobasicseconomics.blogspot.com/

Blight Master
Blight Master's picture
Offline
Joined: 07/18/2011
Hat Tips: 480
Posts: 119
Every Panda before 09 is

Every Panda before 09 is good, the key is to find the "double bagged" Pandas. Of course the better condition the better the price and on ebay its more like the better the picture the better the price. The kooks havent made me money because I havent sold them but the point is I'm picking these up for close to spot. The Pandas are all money makers if you know what to look for. All of the 90's go for three digits minimum if they're double bagged. The harder years are more and they just keep climbing. There were two varieties in 2000 and the cheaper variety (frosted) goes for minimum 300 these days and much, much higher depending on quality. Even Pandas as new as 04 are fetching 2-300+ minimum on the bay. The key is to shop around at your local shops and find the deals. When silver gets high most of these guys send as much as they can off to melt because they dont want to get left holding a huge inventory when prices drop. Its all about turning inventory for them rather than building inventory. Despite their huge cases of old US numis most of these guys just see bullion as bullion. They've already minted 30 million 2011 ASE's whereas most of the 90's pandas had mintages  of less than 100k. You do the math. Just ask your shop if they have any different bullion, if its minted by a Sovereign mint, the premium is low, and they're in BU condition, buy them. There's so many bullion coins to make money on its ridiculous, you just have to find the deals.  You see any year Brittania going for close to spot, buy it. The key is to never pay more than a couple bucks over what you'd pay for your bullion of choice and do your research on whatever you pick up. When grading its a little hard to decipher the subtle differences between a 67 vs a 68, or a 68 vs a 69. But below that its easy to tell. If its been touched by human hands outside of the mint its not gonna get a good grade. If there are any visible imperfections its not gonna get a good grade. If its still in its factory capsule, or in the case of pandas capsule and plastic pouch, then it should get a good grade. For me its more about finding the deals than knowing which coins are worth more. Just consider it diversifying your physical portfolio with the same downside as normal bullion but a lot more upside. The higher silver gets, the easier it is to find these deals. While at the same time you've got the same supply/demand principles as regular bullion with continued rising demand with limited  supply. The more limited the supply is (the lower the mintage) the higher the price potential. Just imagine how much higher the physical demand would be if the US mint minted 3 million ASE's this year instead of the 30 million they've minted so far.

tko
tko's picture
Offline
Joined: 06/14/2011
Hat Tips: 91
Posts: 22
PandaLiberator: Do you have

PandaLiberator: Do you have tips/info on getting coins graded?  Which of the 2 big services do you prefer?  I was looking to get some coins graded a while back (some 2010 ATB 5oz silver bullion coins) but I got a little confused reading their listing of services and trying to figure out if I needed to get a membership or what.

Blight Master
Blight Master's picture
Offline
Joined: 07/18/2011
Hat Tips: 480
Posts: 119
Those five ouncers are gonna

Those five ouncers are gonna be expensive to get graded because of their size. I use NGC through NCS. You send your coins to NCS, they evaluate them to see if "conservation" will improve their grade then take them next door to NGC who grades them. The process takes between two weeks and six weeks depending on how backed up they are but you can call and get the status of your coins as much as you want. Membership is a good idea because if I remember right  you get five free gradings or something that pays for your membership fees. I've only had Panda's graded because it really helps the resale price on ebay. It also gives a little gambling aspect to the process because there's only so much you can see through the plastic and I doubt anyone can tell the difference between a 69 and a 70 through a capsule and a plastic pouch. You can also look at the population reports for each of your coins online to help decide whether you should get your coins graded or not. If a specific coin has a population of thousands of MS70's then its probably not worth sending it in. The flipside though, if you have a specific coin in perfect condition that has a single digit population of 69's, and no 70's, send that puppy in and pray for a miracle 70. Even a 69 on a coin where there's only a couple other 69's has potential to be worth a fortune.

Shipping and insurance can get pricey, and grading in general is not cheap, but on a coin thats worth 10x spot its definitely worth it. If you send in five rare coins and get a 69 on just one, you paid for the grading service with just that one coin.

The Numi market for modern world coins moves and changes so fast that it takes a lot of diligence to keep up, thats how i'm able to get good deals in the first place because the stores can not keep up. I'd suggest doing lots of diligence before paying a significant amount over spot for a coin. You cant lose buying possible numi gems at or just over spot though. If you can pick up a coin that was worth 45 bucks when spot was twenty for 45 bucks when spot is 40 then I'd say you have plenty of potential upside there.

pink freud
pink freud's picture
Offline
Joined: 06/15/2011
Hat Tips: 1606
Posts: 90
The cost for getting a ATB 5

The cost for getting a ATB 5 oz puck graded: For PCGS, If you send in regular service it's $30 grading fee +$20 oversized holder +$18 first strike label = $68/coin (this probably shouldn't be done currently since modern orders are getting done faster than regular at the moment).

If you want them done quicker and send in express then it's $50+$20+$18 = $88/coin

Then on top of those per coin prices you add on the shipping both ways($20) and the $8 handling fee per order. And add another $20/coin if you want TrueView photos

It could cost you $136.  for one puck.  That is why it is so expensive to buy a graded (slabbed) 5oz ATB.

pink freud
pink freud's picture
Offline
Joined: 06/15/2011
Hat Tips: 1606
Posts: 90
Nice thread Panda I too have

Nice thread Panda

I too have just recently completed my collection of Kooks. Average cost = $56.   Now I am working on Kangaroo Proofs. 

The kangaroo proofs started in 1998. So far I have

2003 paid $70  lowest price on eBay = $129

2004 $70  eBay = $148

2005 $70  eBay =   $102                                      

2006 $80  eBay = $114

2007 $95  eBay = $184 apmex= $349.99

2008 $61  eBay = $103

2009 $61  eBay = $126

2010 $85  eBay = $119

2011 $61  eBay = $99

What do you think about the 2010 - 11 High Relief Roo     and the       2009 - 2011 Roo @ sunset?  I am not going to pay over $100 for a coin.  How about you?

No1Hunter
No1Hunter's picture
Offline
Joined: 06/16/2011
Hat Tips: 1324
Posts: 144
PCGS vs NGC

I am not sure about the cost difference between the two grading services but I believe PCGS is a little stricture giving out higher grades but you will realize more $$ for your coins if you flip them.  What I have seen is you will get about the same amount of money for a PCGS69 as you would for a NGC70 with a PCGS70 running about 15% to 25% more.

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Topic locked
Syndicate contentComments for "Numi's as a hedge"