Cashing in on Collectables

Question of the week:I just found a stock certificate from 1970 for one share of Ringling Bros. and Barnum & Bailey Circus. It's very pretty--a colorful piece of paper with pictures of animals and the like. How can I find out how much it is worth today? --Caitlin C. Dear Caitlin, Despite what you might think from watching the Antiques Roadshow, making serious money on items you might find in the attic is actually quite rare. While many collectables--everything from coins and stamps to comic books and baseball cards--do increase in value over time, actually profiting from these items on a consistent basis takes deep know-how about your genre. When we asked the Armchair Millionaire community about their views on investing in collectables, we heard two comments that went right to the heart of what makes it so challenging to make money at it: Value is in the eye of the beholder. "The values of collectables are purely subjective. There is the prospect of great profit only if you can find the right buyer who is emotionally involved in the product." --Erik The usual rules don't apply. "Illiquid assets such as collectables are a game in which the rules are considerably less standardized than the securities markets." --Doug If you're just dabbling with collectables, the first place to turn for information will likely be the Internet. In the case of your old stock certificate, you want information on scripophily--the hobby of collecting old stock and bond certificates. You can visit www.scripophily.com to get an idea of the value of your stock certificate. But if you really want to try to make money buying and selling collectables, you'll need to get much more serious. My guide will get you started with the basics. The Armchair Millionaire Guide to Investing in Collectables Risk. Collectables are among the riskiest of all investments. While they can go up in value, they can also drop. If you buy at the peak of a collectable's popularity (remember Beanie Babies?), it will probably end up being worth less than you paid for it. Lack of liquidity. Unlike more traditional investing--where you can always sell your stocks or mutual fund shares--there are no guarantees that you'll ever be able to find a buyer for your collectable willing to pay your price. If you don't, you'll never be able to get your money out of the investment. Pricing. Prices for collectables are determined by a number of factors, including rarity, condition, age, historical importance and perhaps most critically, current fads. However, at the end of the day, the only thing that determines the price of an item is what another person will actually pay for it. Research. Just like regular investing, you shouldn't buy until you've done your research. Books, price guides, antique dealers, antique shows, the Internet and other collectors can all be important sources of information. Emotion. Unlike the stock market, investing in collectables is about more than simply buying low and selling high. The most successful collectors are truly passionate about the items they collect. At the same time, you have to keep your emotions in check--if you fall in love with a particular item, it's very easy to pay too much for it. THE BOTTOM LINE: Your chances of Grandpa's antique fishing lure funding your retirement years are slim. While investing in collectables might be fun, it's likely to be highly profitable only if you're an expert and you use the same discipline to make those investments as you would any other. PS: There's a great example of a Ringling Bros. stock certificate (1969) for sale for $295 at Scripophily.com. No clowning around!

Comments

[David]

If you have an old stock certificate, and you're not sure if the company still exists or what it's worth, there's a good article at Google Answers that shows how to check if a certificate has any value:

http://answers.google.com/answers/threadview?id=219637
Old Stock Certificates

Worth a look.