Frequently Asked Questions

Technically, numismatics is the study and the collection of all types of currency and often medals. These days it is used synonymously for coin collecting. Coins are collected for scholarly or historical purposes, for financial profit, or purely as a hobby.

Rare is defined as uncommon, few in number, scarce or unusual. In the numismatic industry rarity is relative. Low mintage, low survival rate and demand all play a part in determining a coins rarity. Look at the universal rarity scale for a general rating on your coin.

There are several reasons to invest in rare coins. Namely: profit potential; portability; privacy and tax benefits. Rare coins are not subject to Capital Gains Tax or government scrutiny. The laws of supply and demand have not bypassed the rare coin market. Over the last few years demand for South African rare coins has steadily increased. Supply has always been limited as is the nature of the investment but it is shrinking due to melting, damage and collector retention.

The traditional advice here is to “buy the book before you buy the coin.” It is sound advice but not very practical. Books on South African rare coins are limited and hard to find and that is why the internet has become an indispensable tool. South Cape Coins website has been developed with this in mind and provides you with as much information as we can find – all in one place. We know that it can assist you in making informed and wise decisions w.r.t. your rare coin portfolio.

There are several factors that determine the value of a rare coin:

• Age
• Rarity
• Supply & Demand
• Grade
• Quality
• Eye Appeal
• Historical
• Significance

No, the metal content of a rare coin has no bearing on its value.

Anything from R800 – R40 million.

As an investment, Rare coins can make you unsurpassed profits. However, if handled incorrectly, you can lose money. As with any investment, make an informed and educated decision. Buying good quality, graded coins are less risky than uncertified coins.

Uncertified coins carry a higher risk unless you are an experienced numismatist. The advent of grading services has substantially lowered the risk of investing in this industry. It is now easier to have your coin evaluated based on the grade and thus reduces the risk of making a bad decision and losing money.

A bullion coin is a coin struck from a precious metal such as gold, silver or platinum. They are intended for investment purposes rather than day-to-day commerce. Famous bullion coins are our own Krugerrand, the American Eagle and the Canadian Maple Leaf. The price for a bullion coin depends entirely on the metal price. They will sell for a small premium above the value of the metal in the coin. In contrast, the metal content in a rare coin has little or no impact on its value. The profit on a rare coin is not restricted by metal prices. A fine example of this is South Africa’s most unique coin, the Single 9. The estimated value of this coin is around R30 – 40 million but the metal value is a mere R1900-00. Also, there is a huge supply of bullion coins but the supply for rare coins are small and decreasing all the time. These coins fulfill different purposes in a portfolio.

A commemorative coin is a special coin issued to celebrate and honour a particular event, place or person. They are usually made in a limited quantity for a limited amount of time. While commemorative coins mark special occurrences in recent history, rare coins are part of our history – a ‘tangible remnant’ of a bygone era.

Which coin to buy is completely up to you. Every South African rare coin has an interesting story to tell and profit potential. Whichever coin you decide on, buy the best quality coin you can afford.

The performance of the stock market has no direct bearing on the value of a coin. In the past, when the stock market has taken a dive, demand from investors have gone up as they look to stabilise their portfolio with rare coins.

Unless you are an experienced and educated numistmatist, it is shrewd to steer clear of uncertified coins. The value of a coin varies greatly from one grade to another and counterfeit coins are quite common. It is wiser to buy coins graded by the top two grading companies – NGC and PCGS.

Proof coins are struck using a special minting process and are distinguishable from other coins by its highly polished look. The fields or non raised part of the coin have a mirror-like finish and the raised parts have a frosted finish. All details on the coin are sharp. It is important to note that the term ‘proof’ refers to the way a coin was struck and NOT its grade.

No, rare coins are not subject to VAT or Capital Gains tax as they are classified as collectibles.

Individual coins have proven to be an excellent investment but auctions have shown that a well designed set will command a premium. Basically, the whole is usually worth more than the sum of its parts.

A pedigree coin is a coin that has been part of an important numismatic collection. Pedigree is defined as a listing of a coins current owner plus all known previous owners. ‘Provenance’ is more correct terminology. NGC and PCGS recognise important pedigree and place this information on the certification holder. These coins often carry significant premiums in value. Some of the most notable pedigrees relating to South African rare coins are King Farouk, Pittman, Eliasberg and Eldon Serjeant. Pedigrees provide a confirmation of value and a direct link to the past.

Coin grading is the process of determining the state of preservation and wear of a coin. A common misconception is that grading rates only the appearance of a coin when in actuality it focuses on the level of preservation. The purpose of coin grading is to determine the market value of the coin. The main factors when grading a coin are:

• the quality of the coin die and how well the coin was struck;
• the condition of the metal;
• the wear and damage since minting and
• the overall eye-appeal.

The coin in the best state of preservation will almost always have the highest value. Coins are rated from Poor (which is the lowest grade) to Perfect Uncirculated (the perfect coin) and most coins fall somewhere in between. A small flaw on a coin can mean a major difference in price and that is why accuracy in grading is vital. Always use the most reputable certification companies to grade your coins and only buy coins certified by companies like NGC or PCGS.

Coin Grading provides:

• Authentication of your coin
• Protection from contaminants as the slab is tamper proof and sonically sealed.
• The unique identification number allows for easy identification by the coins owner.
• The grade helps in gauging the coins market value.