How to buy rare coins: RULE 1

The first rule to understanding how to buy rare coins is this:

1) Know some history.  If you don't know any history this is not the market for you.  Buy diamonds.  Buy vintage cars.  Whatever. 

2) Now, if you know some history you probably have a favorite era.  Start there.  Every era has coins and medals that reflect the history of the era.  That commemorate important personages and events.  That were executed by great artists of the era.

3)Research these coins and medals that reflect the history of your favorite era.  How many of a type exist?  In what condition?  Executed by which artists?  Larger gold coins and medals are generally worth more than smaller gold coins and medals.  But rarity and historical importance also play a major role in determining value.

4)You many find yourself drawn to a particular era, or a particular personage, yet you know just a little.  Study up.  Learn a whole lot more.  When you know more than most people you have a natural advantage in determining what has intrinsic historical value and what doesn't.

5) Ignore the market place.  Don't chase fads.  If you happen to realize that Napoleon Bonaparte was a fascinating and important historical character for a host of reasons, yet a gold medal commemorating his coronation is selling for one millionth of the price of a silk screen of Marilyn Monroe: a mediocre entertainment figure who is well regarded now, 50 years after her death, but who in all likelihood will be entirely forgotten in 200 years, use some imagination and project forward to  a time where those values will cross.

6) LETS SAY YOU KNOW SOME ANCIENT HISTORY: This lets you in to a much bigger, yet far more rarefied club for purchasing coins.  From ancient Greece through the Byzantine era you have about 2000 years from which to choose historically significant objects.  And there are precious few humans who have any knowledge at all of this 2000 year period.

7)  It's good to have an overview.  And it's even better to specialize withing this overview.  You might know everything about Alexander the Great.  Or Julius Caesar.  Or Ptolemy.  Or Seleukos.  Or Croesos.  Or Diodotos.  Or Justinian.  Or Irene.  Or Athens, or the Phoenicians, or Byzantium.  Etc.  If you qualify in this way, this is a tremendous area of opportunity for the investor.  Because you will be able to recognize and appreciate exactly why the object of your fascination will always and forever have intrinsic value.

8) Because all that has been preserved and recorded and commented upon thus far, after a thousand or two thousand years, has already proven its value to all those who have striven and labored to preserve it over all this time.

9) If your particular interest is out of fashion right now, all the better.  It will be cheaper to buy.  And everything of historical value comes back into fashion in time.