Numismatic Investments
Since virtually all Australian numismatic websites contain articles on the value of Australian coins and banknotes as investments and include graphs of past performance, we won't repeat the advice here. Instead we'll discuss what we consider to be top investments.It is important to understand that the price a coin or banknote will realise depends upon the demand for the piece and, of course, demand is dependent upon both the perceived rarity and the quality.
The ideal investment piece is of the highest quality and rarity. Examples of these in the Australian Commonwealth series are undamaged predecimal patterns (such as the 1937 trial pennies), pre-1955 proofs and high quality uncirculated examples of the rarer circulation issues. (Top quality 1930 pennies and 1923 halfpennies fit into this category also, although the grades will be far lower than uncirculated).
Most of us cannot afford the $10,000+ for this type of investment so have to compromise. The first compromise to make is that of rarity. High quality pieces outperform low quality ones, even when the lower quality ones are much rarer. As an example, consider these two overdate threepences. The 1922/1 overdate has an estimated mintage in the hundreds, the 1934/3 overdate in the low hundred of thousands. Here are scans of the threepences from my own collection.
The 1922/1 threepence is low grade with a reasonable reverse but a badly scuffed obverse, whereas the 1934/3 threepence is gem uncirculated. I have had people admire my 1934/3 and ask if it is for sale but no-one has ever shown interest in my 1922/1, even though 1922/1 threepences are hundreds of times rarer than 1934/3 threepences. The reason for this is clear when you consider that there are hundreds of 1922/1 overdates better than mine, but my 1934/3 overdate is possibly the finest known.
There are coins valued in the tens or hundreds of dollars that I would consider a good investment. Some of the George VI and Elizabeth II coins are much scarcer in gem unc than you would expect from the catalogue prices and I would expect their prices to rise substantially as people come to appreciate their scarcity. Examples in the low hundreds of dollars range are gem 1940 threepences and gem 1942 florins. In the tens of dollars range are well struck gem 1946 and 1947 florins as well as gem rainbow toned 1956Y, 1957Y, 1958Y and 1960Y pennies.
Peter Andrews
January 2006