Investors' FAQs
Below are some common questions and answers specifically for new investors. Simply click on the question
to jump to the appropriate answer.
Q. "Why do I need rare coins in my portfolio?"
A. "The answer is diversification. The majority of your portfolio is
in equity or paper investments, such as stocks, bonds, mutual funds and annuities. These make up the
bulk of your assets and in most economic scenarios will provide safety and growth for your future.
However, there are certain times when tangible or real assets are important to your portfolio.
One of the most time-tested methods of "wealth insurance" has been rare coin investments.
They are easy to store, easy to value, easy to transport and easy to sell. It is for this reason that
you should have a portion of your portfolio in rare coins."
Q. "How much of my portfolio should be in rare coin investments?"
A. "Generally, 5-15% of your growth portfolio can be in
tangibles. The typical investor usually has at least 10% of assets in rare coins. The actual percentage
that is suitable for you can be easily determined by you and your advisor in a review of your present
holdings. The financial planner insures that the investment is appropriate for the client."
Q. "Is this a rare coin fund?"
A. "No. In a rare coin fund, you receive a certificate for only partial ownership of a coin
portfolio. There are additional fees in a fund for management, legal costs, distribution and storage. A
fund splits the profit between the general partner (the person who manages the fund) and the limited
partner (the investor). In a fund, all control belongs to a general partner. In the USTIC program, there
are no additional fees or splitting of profits. Full control of the portfolio is with you, the investor."
Q. "What is an investment grade rare coin?"
A. "Many coins can be considered ‘investments’ for a number of reasons, however, for the
typical non-collector investor, these general guidelines should be used:
- United States coins only.
- Dated prior to 1934.
- The condition or "grade"is Mint State (MS) or Proof (PF) 63 or higher (64, 65, 66 or 67). Coins graded 68 to 70 are very difficult to price due to extreme rarity and usually should be avoided.
- All coins must be graded and certified by either the Professional Coin Grading Service (PCGS) or the Numismatic Guaranty Corporation (NGC).
- Prices should be a function of the Certified Coin Dealer Newsletter (CCDN) and the Coin Dealer Newsletter (CDN).
- The population of the coin (the number of coins that have been graded by either PCGS or NGC) is low for the series whenever possible. This is available from the current edition of the PCGS or NGC Population Reports."
Q. "What does certified mean? Is it necessary?"
A. "Certification by one of the recognized independent grading firms, such as the Professional
Coin Grading Service (PCGS) or the Numismatic Guaranty Corporation (NGC) provides you the assurance of
an independent 3rd party verification of the grade of the coin, insures that your coin is
not a counterfeit and the grade assigned was issued in conformity with the industry standards of one of
the leading grading services (not assigned by a ‘selling’ firm). The holder will also provide
for the physical protection of the coin itself. All these benefits make certification a very necessary
part of rare coin investments."
Q. "Does the price of gold or silver have any effect on the price of rare coins?"
A. "For investment quality coins, the effect of bullion price movements is minimal, if any.
These coins have value due to their rarity and collector demand rather than any intrinsic metal
content. For example, in the art world, the value of a Picasso is not based on how much paint, wood
or canvas is used to create the work. The same is true with rare coins. An investor who buys a $20
gold piece for $25,000 is not concerned that the coin contains about an ounce of gold currently worth
$350. In lower quality coins, those that are of poor condition and easily obtained, the price is
determined largely by bullion price movement. In this example, a poor quality $20 gold piece that is
sold for $420 has over 80% of its value based on bullion content."
Q. "How have rare coins done as an investment?"
A. "Like any other investment, it depends on the time frame that is examined.
Historically, rare coins perform best when considered a long-term investment. Paper assets make up
the majority of a client's portfolio; rare coins can potentially hedge future cyclical economic events
that affect those assets."
Q. "How can I keep track of how my rare coin investment is performing?"
A. "U.S. Tangible will provide a written evaluation for you at no charge, at least annually on your request. In addition, if you need more frequent reviews, they can be obtained by placing a toll-free call to our offices.
In addition, if you need more frequent reviews, they can
be provided as easy as placing a tollfree call to our offices. All the evaluations are done by
computer and are based on the up to date values as listed on the nationwide electronic rare coin
investment network. You will be able to find out the value of your rare coin investment with the
same amount of effort that it takes to determine the value of your annuity."
Q. "How long should I hold an investment in rare coins?"
A. "Like any other investment, rare coins are cyclical in nature. They go up and down in
value based on economic conditions, market supply and demand. In the past, these cycles occurred
every four to six years, so as a rule you should plan to commit your funds for this period of time.
However, when short term gains are realized prior to the recommended holding period, you and your
advisor can review your portfolio and take profits where available."
Q. "Where do I store rare coins?"
A. "Rare coins are very easy to store. They can be stored in a safe deposit box at your
bank or in a home safe. Since the coins are in sonically sealed, tamperproof plastic cases of
uniform size, they do not require much space. In addition, you will receive a "tangibles
binder" that contains the invoice, descriptions, histories and color digital images of all
the rare coins in your portfolio. You may keep this binder at home to review your investment
while keeping the actual coins secure in your bank vault or home safe."
Q. "How is my rare coin portfolio selected?"
A. "Your financial advisor, after the question of suitability of investment is answered,
will work with you to determine your investment goals, time frame and amounts to invest. Using
the criteria on the selection form coupled with the input from you and your advisor, a portfolio
will be put together. The number of coins will be dependent upon the amount invested. Typically,
for a $10,000 portfolio, there may be four to six coins included. All the portfolios assembled
by U.S. Tangible are totally customized for each client."
Q. "How easy will it be to sell my rare coins?"
A. "Rare coins are among the most liquid and easy to sell tangible assets with many industry
outlets available for liquidation. You may elect to sell them back through U.S. Tangible at any time.
We will provide you a firm price based on the then prevailing market wholesale prices. This method
takes no longer than 5 business days. An additional method of liquidation is through one of our
affiliate's many rare coin auctions. Auctions are conducted approximately once a month at major rare
coin shows throughout the country, where your coins are exposed to the largest numbers of interested
buyers. Depending on which type of auction you choose, the selling process takes from one
to three months. Our auction affiliate takes control of the entire process from the time of your
consignment to sending you your check. So, whether you choose to sell directly or at auction, selling
is a snap."
Q. "Must I become a coin collector?"
A. "No! Investing in rare coins is entirely different than collecting. You
don't have to be an actuary to invest in annuities, nor a stock analyst to invest in mutual
funds. Well, you don't have to be a coin collector to invest in rare coins. U.S. Tangible makes
the investment process easy and understandable, from the time of your purchase until you
decide to sell. That's why you should deal with a company of long-standing reputation and integrity.
U.S. Tangible has worked exclusively with professional financial advisors who have placed their
investing clients in confidence with U. S. Tangible since 1978. We recognize the special requirements
and concerns of investors and the programs are designed to make it easy for you to buy, track and sell
your investment in coins. Importantly, we work with investors through their financial advisors
. The investment is suitable for your portfolio since you and
your advisor decide on the priority of the investment, not the selling firm."
Q. "How can I get more information?"
A. "Check with your financial advisor. Ask if his or her broker-dealer has an agreement with
U.S. Tangible Investment Corporation. Many of the major firms have performed a due diligence
investigation and have approved our programs to be offered by their representatives. If you would like
one of the top independent representatives in your area to contact you about USTIC, please call
tollfree at 1-800-742-6000 ext 333 or email [email protected]
and you will receive a prompt reply."
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