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Episode 2

Episode 2: How to invest 1,000 in coins?

Posted on August 20, 2018 by The Coin Cabinet

 

Here’s my top pick for coins to buy if you were to invest £1,000 in coin? Should you go big and invest the full £1,000 in just one coin, or it is better to split it up and buy several? Is a £1,000 investment enough to get started in coins? I will answer all of these questions, and some more!

 

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Transcription:

Hi there and welcome to the Coin Cabinet YouTube Channel. It's Andreas Afeldt here again. Can you invest just £1,000 in a meaningful way in coins? And what is my advice on actual coin to go for? Is £1,000 enough to start investing in coins with? Yes. Some people actually start with less, but I think personally that you have a decent sum to start with, so that you can buy something that's nice, so that you buy at least one, maybe two coins, but no more than two coins. We're not going for quantity here. We're going for quality, because the rule of investing in coins is this, buy the best quality that your money can buy.

So what should you buy, and how do you go about buying it? For someone starting out in coins, I would say look in sovereigns. Sovereigns is the largest coin market in the world. It has the gold price to fall back on, and there are tons of resource information sites online. You can find lots of auction results and price information everywhere, and lots of people talking about sovereigns, lots of people collecting them, lots of people investing in them. There's a ton of information to find anywhere.

So which sovereigns should you buy? Well, I have done a lot of research into which sovereigns have the best capital appreciation, and you would say perhaps, "Oh, doesn't the sovereign just track the gold value, and maybe a small premium over that or something?" Well, it turns out that the older sovereigns you buy, the more collectible they are, and if the gold price increases, they increase more. We did a study on this, and we put it in this graph that highlights what we are talking about.

Our statistics show that in the 20 years 1995 to 2015, gold bullion was up 200%, so that's what we use as a base for this comparison. That's the blue bottom line, which we can follow here. And then we have the 1870s gold sovereign in VF grade, which was up by 290%. That's that. And then we have the 1860s gold sovereign as well in VF grade, and that was up 330% in the same time. That's that one, the gray one. And then we have 1850s gold sovereign, a considerable jump up to 450%. And the best-performing type of gold sovereign is the 1840s gold sovereign, which is up by 580%. So the best coins to buy with £1,000, gold sovereigns from the 1840s, and buy one to two coins. We would say, from an investment point of view, put everything in one coin, buy the best quality that you can get. Buy one coin from the 1840s or maximum two.

You might buy something in the region of this grade and type, AU-53, a nice-looking coin, AU-55, but you get two, obviously, instead of one. If you get one coin, you get a nice EF coin, and this is a scarce date as well, so you get the really nice coin for that. Or you get the two ones, it's up to you how risky you are. If you want to take a little bit more risk and play a little bit safer, you take two coins.

Please leave some comments in the comments section below and hop on our website, thecoincabinet.co.uk. If you have any questions, give us a call, send us an email, and we look forward to see you in the next video. Thanks for watching.


 

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