Author Topic: MCC market maturity will make coin toning like an ART PRICING investing factor  (Read 2205 times)

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Offline badon

Right now, the modern Chinese coins (MCC) market is not mature enough to fully appreciate mintage rarity, let alone grade rarity and natural toning (beauty) rarity. So, there are good bargains out in the world for coins that have toning, so if you find coins in the original mint packaging (OMP) that you can get for a discounted price because of the toning, go for it! I have been buying OMP toned coins lately because I can get better prices on them, and someday the nicest ones will probably earn a premium price, especially if the toning process continues to beautify the coin as the years pass.

I have been working on this article for months, and finally we saw a "big" sale for an extremely rare, beautiful, and naturally toned coin, which I described below:



Re: MCC LIST #183, move from LBC and continuation here at the CC forum:
1990 2 g silver dragon and phoenix NGC 69 star (beautiful blue and purple toning) sold for the full Buy-It-Now asking price $290: 1990 2g Silver Dragon Phoenix Proof Coin NGC PF69 STAR. Mintage 50'000. From *coinex* (new, ending, sold). The last one of these to sell was a cheap auction for $94: 1990 China 2 gram Silver 5 Jiao Dragon and Phoenix NGC PF 69 Ultra Cameo, from treasurecoastgifts (new, ending, sold). The grade is the same, and the star was awarded for the toning. So, basically, the beautiful toning on $290 coin boosted its value 300% - 3X - TRIPLE! WOW! TRIPLE WOW! Maybe the way to make money on these is to put them in a closet for 20+ years and hope 1 of them turns out to be as beautiful as this coin.

Here's more photos of the toned coin in NGC's certification verification page: Verify NGC Certification 2059617-096 | NGC. Neither photo does justice for this coin in my opinion. The ebay listing photos are too dark, and the NGC photos are too bright and at the wrong angle. In person, this coin probably looks like a shimmering black fire opal. Unfortunately, I did not see this coin until after it sold, or I might have grabbed it for myself, despite the high price.

Normally toning is considered a bad thing in "modern" coins because it is usually associated with severe handling damage, improper storage, or fake artificial toning on coins that are too young to have had enough time to develop natural toning. Almost always in the MCC market, coins get their toning removed before they get certified, which decreases the number of coins that have survived in high grades with beautiful toning. Investors reading here have an advantage in anticipating a change in the market, toward suddenly becoming willing to pay MORE for a coin with toning, instead of LESS.

Although modern coin collectors usually dislike all toning, natural or not, I noticed this has changed in the world's most mature coin market, in the USA. Take this coin for example, a 1990 1 oz silver eagle PCGS 69 available now for only $59:

1990 Silver Eagle PCGS MS 69:


It's an attractive coin in a near-perfect 69 grade, and it's pretty cheap too, so not a bad deal at all for that coin. But, what happens to the prices for that type when they have beautiful natural toning? Below is a good example of some OK-but-not-great toning, similar to the toning on the 1990 2 g silver dragon and phoenix NGC  69 shown further above. It's the exact same coin, but in a lower grade - a 1990 1 oz silver eagle PCGS 68:

1990 SILVER EAGLE RAINBOW TONED PCGS MS 68 TSE-7:


The above coin sold in a cheap auction for $107.50 - nearly DOUBLE the value of a virtually flawless 69 with no toning! That's some impressive percentage profit for whoever found that coin. They probably paid a lot less than $59 for it, before it was certified by PCGS. After I found those coins, I wanted to know more, so I made a search that shows me all the highest-priced coins like that with toning, and I found this coin, in the same PCGS 68 grade:

1990 $1 American Silver Eagle PCGS MS-68 ( Beautifully Rainbow Toned ) ASE:


The above coin sold in a Buy-It-Now for $449.99, after ONLY 1 DAY on the market. That's 769% of the $59 price of a HIGHER 69 grade! WOW! Are you starting to understand what beautiful toning can do to coin prices? This convinced me there is money to be made on beautiful toning, even in modern coins, and almost nobody knows it yet. I had to do some more research to learn everything there is to know about toning on modern coins, so I could identify the fundamentals driving prices, and place my investing bets when the opportunity presents itself.

It's hard to find nicely toned coins in the modern Chinese coins (MCC) market. I spent a few days studying the keywords used to describe toning, and then crafting some sophisticated ebay searches that can find nearly all of the most important ones. I put links to the searches in my badon's ebay spam filter links and custom searches (BESFLACS) list, and then proceeded to study the coins in those searches. This is one of the best resources I found about toning while I was researching this subject and crafting my BESFLACS searches:

Jhon E. Cash - Rare Coins, Currency, and Collectibles - Monster Rainbow Toned Morgans

I had no idea that "monster" toning was so rare that out of hundreds of millions of Morgan dollars minted in the USA, only about 200 specimens are known! Even the most common ones in terms of mintage rarity will sell for thousands of dollars more based solely on "toning rarity", if they're impressive enough. How do you know if it's impressive enough? Well, that's easy - identical coins are minted by the millions, but the ones worthy of your investment money are so special, they are known individually by name. Amazing. Here are some good examples of extremely rare, named Morgan dollars with "monster toning", from the Jhon E. Cash site:



Most of those named coins will sell for between $2000 and $6000, even if they're common types - types that would ordinarily be worth less than $100, even in high grades. People are paying for their toning rarity, not their mintage rarity. However, coins that have mintage rarity, grade rarity, die state rarity ("proof like", PL, DMPL), variety rarity, etc, will naturally be worth more money.

I have owned a few impressively toned coins, and let me tell you, I paid top dollar to buy them, and it hurt. However, I had no trouble quickly selling them for at least what I paid for them. Actually, I can't think of anything that I couldn't sell in a few hours or days, and I was able to sell EVERYTHING for SUBSTANTIALLY MORE than I paid for it. That is double-amazing, especially in a collectibles market that is notorious for being illiquid! The only pitfall to worry about is artificial toning. You simply MUST buy your toned coins certified in NGC or PCGS holders, to be sure the toning is natural.

If you're willing and financially able to take risks and losses on buying coins that might be altered, and thus possibly worth no more than bullion value - they lose numismatic value if they're altered - then go ahead and gamble on some raw, uncertified coins. Whatever you do, get your new toned coins certified as soon as possible to find out if they're naturally toned or not, because time is money. Don't invest 20 years of your life sitting on a coin that turns out to be worthless!

My best naturally toned PCGS coin was so impressive, the dealer that had it WOULD NOT SELL IT TO ME, unless I promised to give him the first opportunity to buy it back if I ever wanted to sell it. I agreed, and guess what? When the time came for me to sell it many years later, I got more money from that same dealer than I could have gotten anywhere else! He loved that coin, and he wanted it more than anyone else, so he was willing to pay more than anyone else. How often does that happen, in any market? Almost never! How BIZARRE!

The market for beautifully toned coins is the original "art pricing", and it's a good example of the powerful effect that unrivaled, unique, and irreplaceable beauty can have on people.



Yes, art pricing CAN happen in the coin market, and my research into the possibility of investing in coins with beautiful toning has convinced me that art pricing in the world's coin markets is not only inevitable, it has already happened. You see, each naturally toned "monster" coin is like a masterpiece work of art from a dead artist - there will never be another one like it, ever, so if it appeals to you, you might get 1 chance in a dozen lifetimes to own it. If it becomes available on the market, take all your cash, all your credit, all your assets, all the extra organs you don't need to stay alive, and sacrifice them so you can beat all other bidders who see and admire the same beauty you are trying to obtain. There is only 1, and only 1 chance to buy it, so don't screw it up.

This is art pricing.

100 Greatest (Most Beautiful) Rainbow Toned Coins (owned by WingedLiberty)



Colosseo Collection | All Coins


 
SDC - A Guide to Toned Gold Coins

« Last Edit: 2016 Nov 06, 09:39:54 PM by badon »
 
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Offline pandamonium

Interesting, no wonder you mentioned my toned 84 silver pagoda in photo (poor photo).    I have several silver pagodas w/ toning.   Maybe i will take photos....
 
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Offline Y7ASyxC

Great article, thanks. That reminds me of badon's recommendation i should put one or 2 of my slightly toned 2012 30th anniversary panda's out to 'bake' on a computer case or something, see what time does to them.
  • never argue with idiots
 
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Offline badon

After learning more about toning, I've changed my mind about that. It's not easy to get beautiful toning, because most of the time it ends up looking really ugly, or it develops too fast and gets tossed in the garbage heap as "artificial". The fundamental difference between natural toning and artificial toning is the time it takes to form. Count on at a few years for a coin you care about. If you want to experiment with a coin you don't care about, then have fun and do whatever you want to it :)
 

Offline badon

Interesting, no wonder you mentioned my toned 84 silver pagoda in photo (poor photo).    I have several silver pagodas w/ toning.   Maybe i will take photos....

I would love to see some nice photos of your toned pagodas. As a matter of fact, I discovered some fake pagodas I bought somewhere in 2010 to 2012 have started toning nicely from the NGC "NOT GENUINE" paper label they put in the "body bag" coin flips they return "dead" coins in. The label is in the other half of the flip, so it's kind of far away from the coin, which gives it slow, even, natural toning. Maybe I'll take some photos of them eventually.

It has been almost half a decade, and they're only beginning to get nice, but not impressive toning on them. They're silver plated or some kind of silver alloy, so they tone well. That's a lot of time for boring toning, so you can imagine people's excitement, anxiety, and frustration when they see a "monster toner" they want that took 100 years to develop its toning. You really only get 1 chance to buy it!

It's tough to beat silver for beautiful toning. Nice toning is a lot harder to find in other metals besides silver. My best toned coin I ever owned was a copper coin, that's why it was so precious that the dealer that sold it wanted me to promise to sell it back to him.
« Last Edit: 2016 Nov 06, 09:38:35 PM by badon »
 

Offline Jens

I agree about the market not being mature enough to appreciate toning, but i think in time it will be appreciated by some collectors while others will probably still want a coin that looks like it was freshly minted.
Many experienced collectors of older german coins see toning as something that is quite natural and a sign that a coin is authentic.
Artificial toning on the other hand is a sure way to lower the value of any coin.
I just send in some pandas for grading at the numismata show and one of them was slightly toned. And of course since it is a modern coin i was asked if i want to have it conserved first but i said no because i'm interested to see if it affects the grade.
It was nothing spectacular, though, just a little beginning toning around the edges, but nice color and evenly spread around the edges.
The NGC employee at the booth said it shouldn't affect the grade negatively, i'm curious to see which grade this coin gets.
"You have to choose (as a voter) between trusting to the natural stability of gold and the natural stability of the honesty and intelligence of the members of the Government.
And, with due respect for these gentlemen, I advise you, as long as the Capitalist system lasts, to vote for gold."   - George Bernard Shaw -
 
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Offline badon

I'm curious too. Do you have any photos of it? Some pandas have very nice purple toning around the edges. I had a bunch of them a decade ago, but I let them go because they weren't a rare type. Now I wish I had kept at least 1 for myself, just because they look so good when they were 20 years old. They would look even better now.

Really good toning takes decades to form, and it's difficult or impossible to fake it on a coin that was minted yesterday. That makes it useful as an indicator of authenticity, just like you said. I'm really eager to see your coin when you get it!
 

Offline Jens

Sorry no photos, i hardly found the time to sort trough my coins and select the ones for grading, so no time for photos.
But as i said it was nothing spectacular, only a slight toning at the edges.
I believe having the coin in a slab somewhat slows the process, so i'm not sure if that coin will develop really great toning in my lifetime   ;)
With any luck my coins will be back shortly before christmas so i might find the time to share the results and some photos then.
"You have to choose (as a voter) between trusting to the natural stability of gold and the natural stability of the honesty and intelligence of the members of the Government.
And, with due respect for these gentlemen, I advise you, as long as the Capitalist system lasts, to vote for gold."   - George Bernard Shaw -
 
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Offline badon

The slab usually stops toning almost completely, especially if the slab is stored properly. You can get some decently nice natural toning in 1 to 2 years, but the longer it takes to form, the better it looks. And, it takes about 100 to 150 years of ideal conditions for the best toning to form. Most toning is not especially attractive, although it does add pleasing "personality" to a coin, if it's not ugly.