Covid-19 has had a profound and unprecended effect on the global economy, and conventional markets remain highly volatile even after the recent Pfizer annoucement. Investors may be considering alternative assets, both old and new, in the face of anemic investment yields. BB talks to collector and broker of rare, high end United States coins, Michael Contursi.
To begin with, could you tell us about yourself – why are you a trusted advisor/broker of rare coins?
I am President of Contursi Rare Coin Investments, a multi-generational family business that handles the most elite and sought-after treasures in the rare United States coins market.
My family has broken many world record sales and maintains the largest active inventory in the world. As the rare coin market has a very high barrier to entry, the only access usually available to people who are interested in learning about this market is the national telemarketing companies that sell commodity coins as opposed to true rarities.
By sharing the expertise and knowledge my family has learned over the last half century, I educate people who want to know more about the market and who are qualified to include rare coins in their family’s long-term holdings.
The relationship gives them access to acquire the same elite assets that sophisticated collectors and dealers seek, while avoiding costly mistakes by working with my family and taking advantage of our track record of success.
Why are rare coins an asset to consider when diversifying an investment portfolio?
With the global pandemic we have witnessed massive economic stimulus, which means inflation and higher taxes on the horizon.
Now with the return to public market volatility and historically low investment yields, many are turning to real assets for the purpose of protecting and growing their hard earned wealth.
Faced with the alternative of sitting on cash and losing to inflation, wealthy individuals are considering United States rare coins because these historical assets have a long track record of wealth preservation and performance in all market cycles, which holds especially true in times of uncertainty such as the Great Recession of 2007-2009 and the global pandemic.
What is the typical ROI over a period of say, 3-10 years?
This market has a low, finite supply of trophy rare coins and over 125 years of high demand from wealthy collectors who are trying to solve a puzzle as they compete with their peers to own the most exquisite collections.
Qualified investors should be in a position where they do not need to liquidate these assets for access to short-term cash. As such, investors with holding power are in a very strong position to profit, as these investors own the missing pieces that wealthy collectors passionately need to locate and obtain to complete their puzzle.
According to Knight Frank’s The Wealth Report, rare coins have increased an impressive 175% in asset value over the last 10 years.
How secure is the investment and how reliable the exit position?
Important advances in transparency mean investors no longer need to be an expert, lifelong collector or hold any particular expertise or knowledge base to own these real assets.
Global consumer protection organizations like the Professional Coin Grading Service and Numismatic Guaranty Corporation put a financial guarantee on the authenticity and condition level from 0-70 for each coin.
This transparency mitigates risk and uncertainty and enhances comfort levels. Anyone can go online and become privy to information like the population known to exist for each coin variety, how many coins are graded higher and even procure price guide values—understanding the finest known coins have very few public sales over the last several decades.
Providing yet additional security and peace-of-mind, today’s coins are placed in sonically-welded holders with anti-counterfeit technology and come with a barcode and certification number.
Regarding a reliable exit position, many investors have a private equity holding period mentality where they plan to privately take investment grade coins off the market for 6-10 years.
During this time, the rare coin expert working closely with the investors or their heirs will broker private selling opportunities, consult on an auction strategy, or continue to be a resource provided the investors decide to hold these assets for the long term as part of their estate planning strategy.
What is the typical entry level for rare coins?
An entry-level individual U.S. rare coin is generally in the $75,000 to $150,000 range for the items that collectors need. Some investors get started with a single great coin, whereas others start with an initial portfolio offering ranging from $250,000 to $1,000,000.
Could you go into detail about particular coins that have notably increased in value?
One exemplary example is the $4 Stella—produced only from 1879 to 1880—was designed to be used as an international currency to help facilitate trade and travel by U.S. citizens. This proof example from the book titled “100 Greatest U.S. Coins,” authored by Jeff Garrett, has shown steady price appreciation over the last 60 years, where often times these assets remain in a family’s estate and are passed down to heirs for multiple generations.
1880 $4 Gold Stella, Coiled Hair
1960: $15,000
1980: $100,000
2003: $350,000
2019: $1,250,000
1885 Proof Trade Dollar
Choice Proof Condition
1960: $15,000
1980: $100,000
2003: $1,000,000
2019: $3,500,000
1907 MCMVII Ultra High Relief Double Eagle
Gem Proof Condition
1960: $20,000
1980: $250,000
2003: $1,000,000
2019: $3,000,000
1793 Flowing Hair Chain Cent
Extra Fine Condition
1960: $750
1980: $10,000
2003: $250,000
2019: $750,000
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