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Beginners' Approach to Collection by Huang Ruiyong

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Josip Broz Tito:
@fwang2450


Vielen vielen dank  :thumbup:


Thank you very much, i learned much with your help.

fwang2450:
SANDAC, that is an amazing piece of artwork. Incredible. 100 Yuan is nothing now, but in 1982, it was about two months' salary of an average factory worker. So it was an expensive piece :)

For your first question, not all the top collectors in China are as vocal and as willing to teach as Huang. Many were and are still the old school type, holding onto the valuable knowledge they gathered during their lifetime, unwilling to share the trade secrets. Huang comes from a different background. He graduated from a technical university, worked at Oracle China for some time, before devoting all his time to collection. He has a different mindset, and is eager to promote the "cause" for the greater good of the MCC collector community.

Another point about Huang is that from his scientific background, he focuses more on methodology and good practices of MCC collection. And he wants to spread this to MCC collectors. So we see these lectures, posts and articles. In recent years, however, he does not post or lecture as much, although you can still catch his presence on weibo.com.

For your second point, many in China still lament that the "old, exquisite and rare" coins were issued to overseas markets only, which is a constant reminder of the poor recent past of China. In the meantime, though, it is for us here in the US to miss the rarest coins, most of which have been shipped back to China and disappeared into the collection of top collectors. Even the "Three Little Dragons" in my earlier post seldom make their presence on eBay, not to mention the first platinum set of Ancient Invention and Discovery or Year of Children piefort gold. I am a later comer, but I believe some of the low mintage coins still available will disappear sooner or later, with more Chinese joining in the hobby.

fwang2450:

--- Quote from: dobedo on October 30, 2012, 07:58:11 PM ---Thank you, fwang2450, for providing this great public service. Google could definitely use your expertise in improving its translation. Looking forward to your future pieces.

--- End quote ---
Thanks, dobedo. In fact my translation is not as polished as I would like it to be, because I cannot spend that much time. There are a few tough words to translate, like "affinity". The Chinese for this word is more subtle, referring to the predestined meeting of the two, not just closeness alone. I am trying my best to convey the meaning. If anyone has any better suggetions on any terms used in this translation, or any questions for clarification, please let me know.

fwang2450:
This is the second part of Huang's lecture for newbie collectors:

Beginners'  Approach to Collection by Huang Ruiyong (Part II)

After the discussion of coin affinity, let’s focus on the importance of logical reasoning.

If we want to achieve high quality in any work, a methodology that employs logical reasoning is a must. An effective methodology cannot be developed in one day, but logical reasoning can help us with objective analysis and judgment on many occasions.

For example, for a beginner, a top issue is whether a coin is worth buying for the price. On this mind racking issue, logical reasoning can come to our help.

Here is an example:
5oz pandas were issued in many years. In general, if the prices are the same, we will pick the one with the smallest mintage. If the mintage is the same, we will pick those issued in earlier years.

Another example:
If the 1/2oz Guandu Battle gold coin and the 1/2oz Chibi Battle gold coin are not very different in price, we will definitely pick the Guandu Battle coin. The reasoning is: 1. Guandu is from the second set, while Chibi is from the third set; 2. Guandu’s mintage is 2000, while Chibi’s mintage is 3000.

Logic reasoning dictates that when we pick coins we have affinity for, we must consider the following factors: mintage, excellence in design, technology, awards received, key date status, packaging, whether made from platinum or palladium, whether priced close to bullion, whether belonging to a special segment (such as piefort, bimetal and coin alignment). Once we developed logical reasoning, we have met the critical requirements for moving up.

The third aspect is coin knowledge. This is a key point, too. In any art collection or investment field, professional expertise will finally transform into physical wealth. This is universal, in China and abroad, in ancient times and in current days, with no exception. With regard to modern precious metal coins, I would like to kindly remind new collectors: gold and silver coins by nature are dual functional, for collection and appreciation, as well as for investment. If we dive deeply into coin knowledge, we will finally harvest both a great collection for appreciation and rewarding investment return. But if one focuses exclusively on investment or speculation, ignoring the essence – accumulation of coin knowledge, he or she will lose out in the long run.

Coin knowledge needs to be accumulated with solid effort: buy coin catalogs/reference materials, visit coin markets, browse online gold and silver coin sites, go to coin shows, communicate with friends constantly, inspect physical coins, and summarize one’s own knowledge from time to time. In this way, you will find yourself transformed into a veteran before you even realized it.  

Of course, it takes great pains to accumulate rich coin knowledge. But if you really like modern precious metal coins, this effort is worth the effort.

Next, we need to establish a sense of gem coins.

What are gems? Gems are like the moon amid the many stars. As time goes by, fashion will fade with wind and rain, but gems will shine forever.

Gems can be divided into high-end gems and gems for the masses. High-end gems, judging from the term, are targets of the top collectors and the super rich. They are like villas in the Xiangshan area in Beijing or those in the Sheshan area in Shanghai. We believe that gold and silver coins generally have three kinds of values: 1. Enjoyment value; 2. Investment value; 3. Show-off value.  For the high-end gems, the show-off value is more dominant. For example the flower-watering (Year of Children) piefort gold coin, 5oz gold coins with a mintage of less than 100, platinum lunars… These are all high-end gems which will only change hands among top collectors or appear on auctions. These are the most expensive coins.

On the other hand, the gems for masses are those affordable by the ordinary people, like the SOHO buildings in the Jianwai area in Beijing, or apartment buildings in the Xujiahui area in Shanghai. Although the gems for masses are a lot cheaper than the high-end gems, their collector base is much larger than that of the high-end gems. These include Year of Children gold and silver coins (normal thickness), 8g lunars, 1989 platinum panda, and the award-winning coins over the years. These are all excellent gems for the masses.

These gems, whether high-end or for the masses, will lead price surges and resist price declines. Their ownership is endorsed by the collector community. In this sense, it is vital to develop a sense for the gems. This is especially important for beginners, because it will save them a lot of wasteful errors.

How can a newbie make sure that the coins he or she collects are gems? Coin affinity, logical reasoning and coin knowledge, which were discussed above, all play an important role.  To those, we can add the following aspects: making friends and information symmetry.

(to be continued)

fwang2450:
I would like to add that when this lecture was given in 2007, Huang had not compiled his coin and medal ranking lists. So the talking about "gem coins" was not inclusive. He has since published two ranking lists, one for coins, the other for medals, available here:

http://china-mint.info/forum/index.php?topic=5352.0
http://china-mint.info/forum/index.php?topic=6549.msg39936#msg39936

These should cover most gem coins and medals, and picking them is a no brainer even for newbies.

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