I first got into Chinese coins in early 2011 when the market was getting extremely hot. I got lucky early on and found a 2000 Lunar Dragon set (5 oz silver rectangle and 1/2oz scallop) in a local coin shop for a small percentage above spot price. I got them graded and they earned PF69. Those coins were so hot then. Dealers were tripping over themselves and paying strong prices to buy them for the Chinese market. I sold the gold scallop to a dealer for many times more than my initial investment. That's good. My gut told me to sell the silver rectangle too, since the market seemed crazy, and it wasn't a series I was collecting. I was about to sell, but a relative of mine who doesn't know much about coins, convinced me to hold it, saying it was "rare". Mistake. That coin has come down several thousand dollars since then. I missed out on a very big return. My lesson learned is, "listen to your gut." If you are the one who spends countless hours studying the market, don't take the advice of someone else who hasn't done his research. When there are supply squeezes and spikes in popularity, there can be very big increases in price. Overshoots. Don't get greedy. Take some money off the table.
It is hard to call a market peak or a bottom. Looking back, some of the old "hot" 1/2 oz gold panda have dropped 40-60% from their peak price. 98 LD was selling for $20k, serif was selling for over $6k, 96 was selling for over $5k? If you owned multiple of these "hot" coins back then and didn't sell, you must be scratching your head now. Just like a stock, nothing will go up or in one direction forever. Almost all collectibles, including coins, go through cycles.
Having said the above, I haven't taken my own advice with my 1995 G1/2. Part of me says cash it out, as the price has run up so much that the probability of additional dramatic rise might be limited. I have a nearly complete collection of G1/2, however, and I've just finalized a trade for the last major piece of the puzzle, so I'm having trouble giving up my single 1995 G1/2. The collector in me is overruling the investor. There is certainly a risk of it dropping many thousands of dollars in price if there is a mini-hoard found somewhere. I'm torn. I rationalize that since gold pandas are such a flagship, popular series, it has a better chance of holding its value.
Most of my bad purchases were made in 2011, 2012 period, when market had peaked, and I had very limited knowledge on MCC and overpaid on some coins, and saw my investment became worth less and less in the following years. Luckily, I started on silver, the less expensive staffs. For example, I paid $2k on a 2000 1 oz silver mirror panda ms 69 on ebay. In today's market, it is probably worth less than half of that.
Worst purchases I made were the ones I did following HYPE: The 2011 Medal and Historical Series SUPER DOPER HYPE! Most of you know what I am talking about. Do your own research and learn as much as possible before buying.
When I was fairly new to the forum, someone who is no longer a member here offered to do a trade. Perhaps my antennae should have gone up when he pointed out in his first PM that he has "high character and integrity". I ended up doing a trade with him and making a separate purchase that was influenced by his hype. I traded some MS70 pandas to him that I had bought as OMP near spot price and graded myself, so my cost wasn't too high, but I still gave up some good coins for a coin that now sells for more than 30% below what it did back then. That person is no longer welcome on this forum, owing to his unethical practices (no not THAT person), but you definitely need to look out for the hype. There are some people who are skilled at using slick arguments to prey on inexperienced people.
I'll echo what others have said. Do your own research to determine what is currently undervalued and/or has fundamentals that make it likely to increase in price in the future. The bulk of my purchases over the past 5 years were to buy semi-key gold 1/2 oz (I largely avoided the sexy key and popular G1/2). I tried to get the overlooked semi-keys for a reasonable percentage above spot price. I watch with interest now as some of those coins have recently started to increase in price. I just used some of these to trade for a 1998LD G1/2 NGC MS69.
Try to buy the overlooked coin with lots of potential, not the coin that everyone is saying is so wonderful. It is out there. Is it now a semi-key G1/4? a condition rarity gold panda? a gold proof panda? or something else? I don't know, but someone who does his own research and thinks independently will have a prize in future years.
