Author Topic: Factors Affecting Trends in Price for Key Date Pandas  (Read 5163 times)

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Offline Mirkkanen

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Factors Affecting Trends in Price for Key Date Pandas
« on: March 30, 2016, 03:45:17 AM »
The market for master set making in China seems to be supporting rising prices for 1/2 oz gold pandas, especially key dates and semi keys (90s dates and a few post-2000s), and select 1/4 oz pandas. What will happen to the prices of these coins, especially the more common date types, when coins are no longer needed to fill master set orders?

1) will they go down due to declining demand?
2) will they rise due to decreased supply?
3) will a price decrease lead to another surge in buying, and hence, increase in prices?


I assume that these master sets are not likely to be sold back to the coin market anytime soon. Am I wrong?

Offline Birdman

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Re: Factors Affecting Trends in Price for Key Date Pandas
« Reply #1 on: March 30, 2016, 07:29:32 AM »
The market for master set making in China seems to be supporting rising prices for 1/2 oz gold pandas, especially key dates and semi keys (90s dates and a few post-2000s), and select 1/4 oz pandas. What will happen to the prices of these coins, especially the more common date types, when coins are no longer needed to fill master set orders?

1) will they go down due to declining demand?
2) will they rise due to decreased supply?
3) will a price decrease lead to another surge in buying, and hence, increase in prices?


I assume that these master sets are not likely to be sold back to the coin market anytime soon. Am I wrong?


Common variety of gold pandas of a given year or MS68 quality are being bought up by dealers and investors, they know master set demand is here to stay and that even small orders of 10-30 sets in a given year cause great dislocations (spikes) in the market.  The rarer varieties and MS69 coin are being bought by investors and collectors, they know that as new collectors enter the market via new issues, eventually the smarter ones will realize that a 2016 30g gold panda with a mintage of 600,000 for $1400 is overpriced compared to 31.3g gold panda issued a decade(s) earlier can be had for the same price.  The MS70 are being bought by exclusively collectors, they are ones that want the very best grades for long term holdings with little interest in selling for a profit.

From what I can tell there are still several dozen master sets that are planning to get made?  And it may be an ongoing program from there.  Supply for some of the coins is already very limited.

In addition to your questions, what I find intriguing is understanding the potential effects the master sets are having on the price and supply of the different varieties.  If 150 or so master sets have been made, that means that the vast majority of the coins are the more common variety (which has been the cheaper option).  For some semi-key and key coins, they have been cracking coins out of slabs to get the coins they need (even some MS69s).  Let's say for discussion that for a given year the SD is more common than the LD (it is the opposite or some years).  Accordingly, to fill the 150 master sets, perhaps 130 SD have been locked away in master sets (the remaining 20 of 150 or so sets might have been filled using lower grade LD).  Is the SD now the scarcer coin in the open market if you want to buy a slabbed coin for a key or semi-key?   And will prices reflect that going forward?  The price difference between the common and rare variety has compressed for some coins.  Will it continue?  Are coins in the highest condition (MS69/70) less likely to be distorted in this way, as they are held by true collectors who appreciate their relative scarcity?  Alternatively, is now the time to pick up a rare variety for a key or semi-key, because most people are just scrambling to fill date slots and not charging much extra for truly scarce varieties.

Offline Deepwater

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Re: Factors Affecting Trends in Price for Key Date Pandas
« Reply #2 on: March 30, 2016, 01:11:35 PM »
This is a good topic to discuss. My question is why 50 more master sets will drive the prices of semi-key dates 20%-30% higher than a couple of months ago? Maybe some dealers are holding those coins for higher prices.

Offline Wafdawg

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Re: Factors Affecting Trends in Price for Key Date Pandas
« Reply #3 on: March 30, 2016, 03:06:06 PM »
From what I can tell there are still several dozen master sets that are planning to get made?  And it may be an ongoing program from there.  Supply for some of the coins is already very limited.

In addition to your questions, what I find intriguing is understanding the potential effects the master sets are having on the price and supply of the different varieties.  If 150 or so master sets have been made, that means that the vast majority of the coins are the more common variety (which has been the cheaper option).  For some semi-key and key coins, they have been cracking coins out of slabs to get the coins they need (even some MS69s).  Let's say for discussion that for a given year the SD is more common than the LD (it is the opposite or some years).  Accordingly, to fill the 150 master sets, perhaps 130 SD have been locked away in master sets (the remaining 20 of 150 or so sets might have been filled using lower grade LD).  Is the SD now the scarcer coin in the open market if you want to buy a slabbed coin for a key or semi-key?   And will prices reflect that going forward?  The price difference between the common and rare variety has compressed for some coins.  Will it continue?  Are coins in the highest condition (MS69/70) less likely to be distorted in this way, as they are held by true collectors who appreciate their relative scarcity?  Alternatively, is now the time to pick up a rare variety for a key or semi-key, because most people are just scrambling to fill date slots and not charging much extra for truly scarce varieties.

Very interesting points and questions.  Allow me to hypothesize and I would be interested in your feedback. I believe in Gresham's law.  So bad money drives out the good.  Applying that here it would work in reverse because of the dealer. I would suspect if a dealer is putting together master sets and has several varieties (i.e. Large Date, Small Date) of the same coin, or several grade varieties of the same coin (i.e. MS69, MS68, OMP), then the first master sets put together would contain the least key date varieties and the worst grade condition coins.

The dealer would hoard the better grades and better varieties to sell to the better informed collector and/or investors at higher prices.  Dealers would only include these coins in master sets if they don't have a choice. So initial master sets will be far cheaper to put together than later master sets, which may very well have to include the rarest varieties, the best grades, albeit unwillingly. Master sets sold later can also tout they contain this key variety, in this grade condition to justify its escalating price. Distinctions between master sets will be made.  Master set vs. Master Master set or All Key Variety Master Set.  Or MS69 Master Set. You get the idea.

Master set demand will drive up prices of everything! Lower grades will go up in value and as a result will be bought up by dealers and you'll see a lot of them sell but the real varieties, the higher grades, those sales will be less and fewer and farther in between, and their prices will be astronomical. And when one is needed to put together that Master Master set it will be quickly obvious that its always wiser to have the best of the best.

Offline silverpv

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Re: Factors Affecting Trends in Price for Key Date Pandas
« Reply #4 on: March 30, 2016, 03:36:50 PM »
I think this assumes that there is unlimited demand. If demand for master sets continues then this is a possibility. If demand drops off for master sets I think prices should stabilize for the sharp spike coins, which it looks like it has. The question is whether demand is sustainable at its current pace and price escalation.  Less demand will result in stable or declining prices. I think the chinese will continue to repatriate coins as awareness grows, but there has to be a marketing push over there. Such an event would cause a swing in pricing since it seems individuals can sway the panda markets with heavy buying. I'm curious to where the market goes from here. Pandas are getting ridiculously expensive and I'm wondering who will/can continue to buy in this market when there are other things available or just buying kilo gold bars.

The idea of a master master set is very difficult to accomplish because there are so few of the MS70's around and those that have them aren't likely to let them go in every denomination cheap. Not every collector will sell. That or they'll be knocking on doors of the people on this forum, wg, birdman, etc.. lol.

Offline Wafdawg

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Re: Factors Affecting Trends in Price for Key Date Pandas
« Reply #5 on: March 30, 2016, 05:01:19 PM »
Ok so the question is whether demand is sustainable at its current pace and price escalation.  I would argue yes to both.  We have seen rabid demand in the precious metals market on huge moves upwards and huge moves downwards. In this case I think higher prices will lead to higher demand.  Having a master set is a prestigious achievement in which any wealthy Chinese person would be more than willing to pay the price for.   The more expensive it is the more prestigious it is.

As far as a master master set, I just threw that out there as a way to distinguish one master set vs another one.  So yes, fully agree a MS70 master set is impossible since so many coins do not even have that grade or there's less than a handful of the total MS70 population.  But a master set of all MS69s containing all key varieties such as the 95 and 98 1/2 large date, the 99 serifs, the 90 small dates, 92 small dates, 93 large dates, etc will be worth far more than another master set that only contains the coins in omp and in the more common varieties.

Offline pandamonium

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Re: Factors Affecting Trends in Price for Key Date Pandas
« Reply #6 on: March 30, 2016, 05:24:41 PM »
This is the beginning of demand for master sets......

Offline silverpv

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Re: Factors Affecting Trends in Price for Key Date Pandas
« Reply #7 on: March 30, 2016, 06:03:18 PM »
This is the beginning of demand for master sets......

Can you elaborate on this thought? I was thinking demand was starting to dry up by now. It's been a few years already right?

Offline baron88

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Re: Factors Affecting Trends in Price for Key Date Pandas
« Reply #8 on: March 31, 2016, 12:40:32 AM »
How much a master set is selling for in general right now? And how about price for a ms69 master set? Is there a market for such sets in the US?

Offline Birdman

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Re: Factors Affecting Trends in Price for Key Date Pandas
« Reply #9 on: March 31, 2016, 06:47:09 AM »
How much a master set is selling for in general right now? And how about price for a ms69 master set? Is there a market for such sets in the US?

This NGC MS69 master set (1982-2011) has been available on eBay in the US (and likely worldwide) for months.  Apparently, $285,000 is too expensive?  :001_smile:
 
http://www.ebay.com/sch/Coins-World-/256/i.html?_from=R40&_nkw=gold+panda&_sop=16

I would be curious what today's price is for the non-NGC MS69 master sets.

Offline pandamonium

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Re: Factors Affecting Trends in Price for Key Date Pandas
« Reply #10 on: March 31, 2016, 08:01:56 AM »
Can you elaborate on this thought? I was thinking demand was starting to dry up by now. It's been a few years already right?


OK, here is the basic information posted on line;
King World News says Commercials are covering their shorts on gold/silver so expect a price rise.......
China sells pandas at banks so access is easy and the coin collecting mania is just beginning in China.   The general theory is that 100 million Chinese new collectors can enter into this market.    China has 5 times the US pop of 300 million so 100 million new collectors = 1/15th of China's pop.    About 1/2 or less of China's pop can afford bullion...... 
Currencies worldwide will be devalued so the World is buying gold/silver.......
China's AIIB banks and CHPS payment system, etc is now in place to replace the US dollar at some point due to debt/derivatives of the USD.   China will tie their Yuan to gold to be the next reserve currency as billboard photos say that too.   China owns the gold and they have a Gold Army to find gold...............
Greshams Law means the best of money will be held and that is happening now in the Pacific NW as the wise are buying MCC and not selling.   Word is out in the NW that Chinese money is real money and gold/silver minted in China will be the best of the best.............
Gold/silver demand may seem high today but it is just beginning.   When supply runs out we will see a bidding war for real money.   We would all bid for real gold/silver and not paper money.........
There is a huge ocean of paper currencies looking for ROI and a safe haven which is gold/silver.......imagine the Great Lakes full of cash and a pick up truck on the shores on one lake that represents gold/silver supply...the ocean of cash will lose value so it will flood into the pick up truck......comments like this have been online for years and today it makes sense to more sheeple........we are ahead of the game as we are into MCC ahead of the herd......
The best of gold/silver bullion is rare coins.   The best of rare coins belong to the next strong economy and their dollar which is China........
What is to stop MCC and other Chinese collectible money from becoming the top collectible money worldwide?........
Lots of other info and this is just a few points......


If anyone thinks i am wrong or did not include other information then please post........
 

Offline pandamonium

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Re: Factors Affecting Trends in Price for Key Date Pandas
« Reply #11 on: March 31, 2016, 08:45:18 AM »
Oops, one last one.......
In the 1980's the rare US coin market had a flood of investment funds enter the small market.   Many rare US coin collectors became wealthy almost overnight.   Strong US dollar means strong prices for US rare coins.   In time China will have a strong Yuan and the USD will fall as will rare US coins.    Those collectors that profited on rare US coins are now in the MCC market.     They expect the same results but this time more money has been created since the 80's so when big money comes into MCC and other Chinese collectible money the gains will be higher......
Last yr i posted a article that the Chinese paid about $387,000? for the World's top racing pigeon.   The European bidders stopped bidding at about $80,000.    One example of many that Chinese will outbid for what they want as they are the World's wealthiest country.    MCC is a semi immature market today....
MCC collecting is a no brainer........

Offline moosician

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Re: Factors Affecting Trends in Price for Key Date Pandas
« Reply #12 on: March 31, 2016, 01:14:26 PM »
How much a master set is selling for in general right now? And how about price for a ms69 master set? Is there a market for such sets in the US?

3 days ago, according to a Shanghai coin market gold panda dealer, b.u. master set selling at 1,230,000 rmb.

Offline KeepOnTrying!

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Re: Factors Affecting Trends in Price for Key Date Pandas
« Reply #13 on: March 31, 2016, 02:38:03 PM »
3 days ago, according to a Shanghai coin market gold panda dealer, b.u. master set selling at 1,230,000 rmb.

= $190,751USD at today's exchange rate.
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Offline Wafdawg

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Re: Factors Affecting Trends in Price for Key Date Pandas
« Reply #14 on: March 31, 2016, 03:32:48 PM »
= $190,751USD at today's exchange rate.

So it is overpriced.  Picture doesn't even show all 149 coins.  It's also not very clear.  Can't make out much of the varieties but I see the 98 is a small date. I don't think he really intends to sell it on eBay.  Just advertising.