Coin Collecting (Rare coins) and other
tangible assets still can out-pull the stock market in the short-run, and in
the long-run, can give stability to an investment portfolio. That's the
inescapable conclusion of a new examination of the key components that once
comprised the annual Salomon Brothers survey of tangible assets.
Salomon Brothers released its first study of tangible assets some 23
years ago this past June, in 1978. To the surprise of many on Wall Street, and
elsewhere, rare coins turned out to be a long-term investment vehicle that
outperformed equities. The coin market exploded as a result of the survey and
a variety of other economic factors.
For a dozen summers that followed, the Salomon Brothers examinations
were closely watched by many investors, as well as collectors -- all of whom
wondered how an objective examination of the rare coin market would fare. A
number of other tangible asserts were also brought into the comparison.
The Salomon Brothers survey met its demise in the 1990's, a victim of
its success. The Federal Trade Commission complained that it was being misused
by the unscrupulous who failed to properly disclaim what needed to be
disclaimed -- and to advise readers of the fundamental weaknesses in the rare
coin market.
Re-creations of that list in the year 2001, and a comparison with years
past, show that the rare coin market remains a strong vehicle even as the Dow
and precious metals rise, and fall, with regularity. The irony is that as the
Dow Jones industrial average shoots up, and down, a hundred points at a clip,
coins have held solidly without the volatility associated with the stock
market; and that there remains a strong trend-line that points positively for
the future.
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Dow Jones Industrial Index - January 2000 to March 2010
PCGS3000 - January 2000 to March 2010
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