The Power of Wise Investing
The Prime Numismatist
Louis E. Eliasberg, Sr. is often brought up as an example of a true numismatist. He set out to build the ultimate collection from 1925 to 1950, aiming to own one of each date, mint, and major type of United States coin ever struck. By 1950, he had achieved the impossible, amassing a collection that included everything from a 1793 copper half cent to a 1933 gold double eagle.
His collection, which had cost Eliasberg less than $400,000, realized over $40,000,000! This figure doesn't even include the millions more generated from the sale of his world gold coins (excluding U.S. coins) by American Numismatic Rarities in 2005.
Eliasberg was also known for his passion for sharing his love of the hobby with others. He exhibited his coins in various locations, including banks and even the Philadelphia Mint. One particularly notable venue was the Smithsonian Institution, where his collection attracted an astonishing 1,500,000 viewers in just four months!
Eliasberg emphasized the importance of buying through reputable dealers and being thoroughly familiar with all aspects of investing in rare coins, especially if you're allocating a significant portion of your assets to this venture.
The Eliasberg Collection's success story is far from unique among old-time collections. In fact, handsome returns have been the norm rather than the exception. Every single old-time collection that my associates and I have cataloged, auctioned, or purchased outright has yielded substantial profits.
Spectacular Success Stories
A collection doesn't necessarily need to be "old-time" to perform exceptionally well at auction during strong market conditions. While I've had my fair share of handling great collections and rarities over the years, many professional numismatists have also achieved success for their clients.
Harold S. Bareford, who collected coins from 1947 to 1954, spent a mere $13,832 on his collection. When Stack's sold his collection in a series of four sales between 1978 and 1985, it realized $1,207,215—nearly 100 times its original cost! Today, those same coins would likely fetch around $12 million.
John J. Ford, Jr., a longtime coin dealer but never a wealthy man, devoted much of his life to his collection of coins, tokens, medals, and paper money. Stack's has garnered tens of millions of dollars from the items offered in a series of sales that are not yet complete.
Similarly, John J. Pittman, an employee of the Eastman Kodak Company, collected coins from the 1940s until his death in 1996. Despite not being a wealthy man, he once took a second mortgage on his modest home to pay for coins at a major auction sale. His financial investment over the years was likely in the hundreds of thousands of dollars, with some of that amount gained by selling and trading duplicates. When David W. Akers cataloged and auctioned his collection, it realized about $30,000,000.
The Koshkarian Collection featured a superb gem 1797 half dollar. Dr. Koshkarian purchased this coin for a world-record $220,000 at the Norweb sale. In 2004, it sold for a new record of $966,000, receiving an enthusiastic round of applause as it went to its next Southern gentleman owner.
The Oliver Jung Collection, formed in 1997 and sold by ANR in 2004 with spectacular results.
More often than not, this scenario plays out on a smaller scale. A collector spends several tens of thousands of dollars building a collection and realizes several hundreds of thousands of dollars when it is sold. So, what can we learn from these success stories? Is it merely a matter of luck, or is there a formula for achieving such impressive returns? How can you, as a collector, position yourself to benefit from the potential growth in value of your cherished numismatic assets?
I hope I will be able to answer those questions in the posts to come.