6. Do not accept performance guarantees on coins

The most important thing to remember about a guarantee is that it is only as good as the guarantor. In other words, if you accept a guarantee from any entity that is not a highly respected organisation, then it is not worth the paper it is written on.

The only people prepared to guarantee the performance
of rare coins are con artists.
If anyone guarantees anything, they need to deliver. A guarantee comes without compromise and can only be issued with confidence by the most powerful and largely resourced companies. A good rule of thumb when offered a guarantee is to ask your insurance broker or your banker whether you should accept it or not. They will probably advise you to decline it unless it has been issued by a highly respected institution. It is also a good idea to approach other companies in the same industry and ask them whether they would accept such a guarantee or not.

The performance of gold bullion cannot be guaranteed by some of the largest companies in the world. Rare coins are no different. Their performance cannot be guaranteed.
The only companies that are able to issue guarantees are larger companies and those that have been in the business for many years. Coin companies are unable to issue guarantees relating to the performance of coins. This is due to the fact that coins are a floating investment. Floating investments like stocks, property and coins cannot be guaranteed, because the variables influencing them preclude an accurate projection.

Gold is also a floating investment, yet there is not a single company in the world that would consider guaranteeing its performance over a set period of time. They do not guarantee it because they cannot. If you were to ask a gold analyst to guarantee the performance of gold, they would say it is impossible to do so.

Stockbrokers are not willing to guarantee a stellar performing stock like Microsoft.
Coin dealers are also not able to guarantee the performance of rare coins.
The only financial mechanisms that may be guaranteed are those that have fixed variables, such as interest rates. Interest can be guaranteed because it is a simple calculation. If you lend money out at 28% interest, then you need to deduct your own interest of say, 16%. That will leave you with a nett profit of 28% - 16% = 12%. Bear in mind that in order to accept a guarantee, the issuer must be beyond reproach.

Occasionally, clients might ask if we can guarantee the performance of a particular coin. The answer will always be "no", as it is impossible to do so.

All coin companies that have offered performance guarantees in our market, have gone bankrupt. No person or organisation can guarantee a floating investment. A floating investment is one that moves up and down in accordance with the general conditions of the market, such as rare coins, stocks and property. If anyone was able to accurately predict the value of any of these investments over a certain time period, only then would they be able to guarantee its performance.

The United States Capital building in Washington DC, USA. Not one single coin company
in the entire United States guarantees the performance of any rare coins.
It is our opinion that the only companies that provide performance guarantees on any floating investments are attempting to defraud you. If larger, more reliable companies cannot offer guarantees on floating investments, then it would be worth your while to be cautious when a lesser known company promises a guarantee. Very often, these companies are intent of defrauding you of your money.

We would advise all investors and collectors to be wary of such promises. If reputable companies cannot offer guarantees on floating investments, then smaller, less reputable companies cannot offer it either.

The United States has the largest rare coin market in the world, with over 8 000 coin dealers. Their largest rare coin company is called Heritage Capital Corporation and has a turnover of approximately US $160 000 000 per annum. Not one single coin company will offer performance guarantees. The reasons for this are that firstly, they are unable to do so and secondly, to do so would be an act of fraud.

If you have been issued a guarantee from a coin dealer and this has been reneged on, please click and let us know. We will place you in contact with the relevant authorities who will assist you with the recovery of your money.