Large amount of union coins being graded

[jcriller 11]

Hi fellow collectors

I would like to get the experts opinion on the large volume of union coins getting graded, it seems there is a sudden influx of high quality union coins, for eg in December 2011 there were only 137 graded 1923 1/4p and 68 graded 1930 1/4 p coins. Now about 9 months later we have 241 graded 1923 1/4p and 80 graded 1930 1/4p coins. Most of the new graded coins are above MS62.

 

Do you think that this will have an effect on the buying price of union coins? A 1930 1/4p recently sold for R7800.00, it seems quite a high price to pay for a coin with 97 other specimins around. And in the next few months the total population might climb to well over 100.

 

I am by no means an expert so i will leave this up for discussion to the experts.Looking forward to your replies

 

Regards

[jwither 11]

I do not have access to the NGC census. I believe Pierre told me here that you do not need to have a paying membership (I let mine expire since I no longer buy enough coins to send in for grading) but I cannot access it anyway.

 

Having said that, my comments on your post are these. Are these coins representative on the increases you have seen for Union? I ask because I have noticed large increases in some date/denomination combinations in the past but the absolute numbers were not particularly large except in a few instances and I suspect this is still true.

 

For the two examples you gave, neither of those two coins are particularly scarce. The 1923 bronze along with the 1924 1/2D had the largest populations for Union coins the last time I checked and yes, I have noticed substantial increases in all of these coins before, particularly with the 1924 1/2D and 1923 1D when many "conditional" rarities or near it suddenly showed up in the census.

 

I consider the 1930 as the "key" date in the Union farthing series (since I am dubious about the 1933, 1934 and 1936) but it is not "rare" either. I believe Pierre mentioned once that it is a very difficult coin to find in lower or mid-circulated grades. With a relatively low mintage of 6500, I am sure it is but most collectors who are looking to buy a Union coin in its price range are not interested in buying most SA coins in these grades. The last time I checked the census, MOST of this coin were MS with most of the remainder in AU. I believe there were a handful below AU.

 

As for the prices, demand is vastly more important than supply so the increase in and of itself does not mean that the price must decline. The census populations of most Union (and ZAR) issues have increased by a lot since I started collecting, though in many instances only proportionately. You did not say what grade that 1930 had, but unless the coin is an MS-63, I would not pay that much and yes, I would not pay it because the coin does not deserve such a price. I have owned quite a few KGV farthings in different MS grades up to MS-66 and I can tell you that an MS-62 (or below) is a really mediocre looking coin. This coin apparently has a "reputational" scarcity due to its "key" date status and low mintage which is NOT justified by its actual availability and relative price versus other KGV or even Union coins. Recently, a 1935 NGC (or maybe PCGS) MS-63 1/ sold for $400 on eBay. This coin is not "rare" either but it is both scarcer and more desirable than a 1930 1/4D in actuality. So what exactly is the justification for this price variance, especially given that the price you quoted is not even an outlier? The answer is that there isn't one and before I would even CONSIDER BUYING one, the 1930 would either have to drop substantially or other MUCH BETTER coins would have to increase in price A LOT.

 

As for the 1923 1/4D, I happen to own the "red" variety as an MS-62 (though it is not noted as such on the holder), but personally I would not even likely consider a BN below MS-64 for any date other than the 1930. The minimum grade that I would look for in this coin would probably be an MS-65 unless the price spread is larger than I think it is now in which case I probably would not even want it at all. I'm not sure what this coin sells for now but I can think of no reason why an MS-64 or even MS-65 should sell for more than $50 USD in today's market.

Edited September 4, 2012 by jwither

[jwither 11]

I finally renewed my NGC paid membership last night and took a look at the census. Earlier this year or late last year, I took an extract from both NGC and PCGS for all Union and ZAR but I cannot find it now. I also have a snapshot of the populations for 2/6 in AU and MS dated August 13, 2010, though not in specific grades.

 

What I noticed in my review yesterday is mostly as I described in my last post above. As examples, the MS population for dates like the 1923 2/6 increased to 14 MS just for NGC whereas on 8-13-2010, it was 11 for both NGC and PCGS. The NGC census shows 4 MS-64 which may include one or more duplicates but I would not assume there are any; only say so if I had specific evidence. I also noticed that the populations of dates like the 1948 and 1949 2/6 have also increased to 26 and 23 MS for NGC whereas on 8-13-2010, they were 18 and 20 for BOTH.

 

For the 1923 and 1930 1/4D, I noticed that the 1923 has 90 in MS-65. So I stick by my price estimate that this should be no more than a $50 coin, though I expect it probably sells for somewhat more since it is one of the few Union that is essentially available to any Union collector who wants to buy it and has the money.

 

On the 1923 2/6, Heritage has an MS-64 closing today with a current bid $3500-$4000 (with buyer's fee). I still think that it is overpriced versus an AU-58 but I do not see that the census increase makes much (if any) difference to what it should sell for.

[jcriller 11]

Thanks for the feedback, i agree with the point that some of these coins sell for such a high price that i do not think the investor/collector will ever see a profit from them.I have seen a few 1923 1/4D MS65 selling for R2000.00+. Even though it is the first coin in the series it's really not so difficult to get hold of. Some silvers looks much better in AU than to some of the MS grades.(I,m not a big fan of toned coins) What would you say is the minimum grade (on average) to collect on the union silvers?

[jwither 11]

That the 1923 1/4D is the first year of the series is one possible reason why it is so common. The same applies to the 1936 1/2D and 1D as the last though I cannot explain why this only applies to the bronze. This is the noRm in the United States; people (even noncollectors) saved the first year of a design because it was new and 1923 was the first year for Union.

 

After I wrote the last post, I saw one or a few 1923 1/4D in MS-65 which I believe were bid or offerred at somewhat over $100. In a way, I understand why it sells for this price but as an "investment", I consider it a poor value. I believe there are likely quite a few more to be graded in many MS grades, including as an MS-65. Since I would like to have a complete set of something for Union, eventually I might buy it but I am in no rush to do so.

 

On the minimum grade to collect for Union silver, I do not believe there is one. I am not trying to evade your question, it will just depend upon what is available and how scarce and desirable the individual coin. I would probably consider any 1931 silver except for the 6D pretty much regardless of the grade as long as the price was "reasonable" and the coin was decent. For other dates like the 1925 2/ or the 1926 1/, I would prefer to buy one no lower than VF-30. Going down one more notch on the scarcity scale, I would consider any of the KGV 1/, 2/ and 2/6 (like the 1930 1/ or 1929 2/) in grades of AU-55 or better once again for the right price and if the quality was right. Not only do I believe that these coins do not look that different from an MS-61 or MS-62, but also that they are much better values because they are far more reasonably priced. For the more common silver, I would not spend any "real" money on them below MS-62 or maybe even MS-63. Even though many AU-58 are as good or even better, buying these relatively common coins below this grade (MS-62) is a waste of money from a financial standpoint. They are too common. An example of that is the 1932 1/ where my preferable grade is probably an MS-64.

 

For KGVI, I would want a coin like the 1944 1/ or 1938 2/ no lower than XF-40, For other dates like the 1946 1/, 2/ and 2/6, at least AU-55. For practically every other date, MS-63 or better. For QEII, a minimum of MS-63. The reason for the difference between these two and KGV is a function of the fact that KGV simply generally look better in the grades I described and the financial prospects are also better. Most KGVI and QEII are too common below MS-63, unappealing coins much of the time, or both.

 

All of the above are subject to what the coin looks like and the relative prices between different grades. Obviously, I prefer higher grades and better coins but it depends upon the price. As I have pointed out here many times, I do not believe in paying "stupid" money as demonstrated by the multiples I have pointed out for higher grade coins.

 

In terms of toned vs "white", be careful not to dismiss the toned specimens, especially from a financial standpoint. I too shared your opinion until I started posting on the NGC Message Boards where I learned that "white" is not always better.

 

Which one I prefer depends upon the coin and what it "should" look like. For any Union coin, either are acceptable to me but I can tell you that many "white" coins have probably been dipped in the past, even if they are in an NGC or PCGS holder. These coins may be "market acceptable" but many of them are really not that appealing for the grade and when this applies, I expect their financial prospects to show it in the future.

 

With the others coins I collect, I almost always prefer toned coins as long as it is not unappealing. A Spanish colonial pillar that is "white" simply does not look natural because no one should expect a coin that is in the range of 250 years old to look like that.

Edited September 11, 2012 by jwither