Coin Collecting Versus Stacking: What’s the Difference?

While their primary goals and motivations may initially appear to be different, stackers are often collectors too, and collectors like to stack as well.

While their primary goals and motivations may initially appear to be different, stackers are often collectors too, and collectors like to stack as well.

People who buy precious metals are often called “stackers” because they like to stack bullion in various forms such as coins, bars, and rounds. This type of buyer usually tries to pay the lowest premium over the spot metal value of the bullion they are purchasing, and their main goal is to acquire as much precious metal as they can afford to, or as much as they feel they should own as part of their overall financial goals.

Stackers tend to focus on things like making sure their precious metal investments are safe, secure, and accessible, typically opting to have physical ownership of their investments rather than investing in precious metal stocks and securities. 

However, some investors prefer to have their bars and coins stored by a company they trust. The Royal Mint in Great Britain recently began to offer this service to UK residents who can purchase gold and silver bullion from them and have it stored as well. The Perth Mint in Australia also offers this service.

On the other hand, coin collectors are interested in the coins themselves, especially in their designs and the history behind them. They seek to build sets of coins and to develop collections that have some coherence and personal significance for them rather than just accumulating a bunch of coins.

Coin collectors are also very concerned with the state of preservation of their coins. Many only purchase professionally-graded coins, especially if they collect older and rarer coins. They also focus on mintage levels and study how numismatic premiums for their coins have evolved over time. They keep up by reading numismatic books, periodicals, and web sites.

They may collect for personal enjoyment, as an investment strategy, to diversity their assets, or some combination of these goals, but whatever the main motivation, they are focused mainly on the coins and not as much how much silver, gold, or other precious metal they have accumulated over time.

There is, however, some degree of overlap between bullion stackers and coin collectors. And that is especially the case with modern coin collectors since many bullion coins are now widely collected as numismatic items.

For starters, coin collectors also care about how much precious metal they own. They often have several interests related to coins, medals, and similar objects. They may also invest in precious metals bullion bars and coins in addition to working on various coin series. 

In fact, some people start out as bullion buyers, and then as they acquire precious metal items, they become more interested in the coins they own. And this often leads them to become coin collectors as well.

American Silver Eagles are one of the best examples of this phenomenon. These coins are extremely popular with silver buyers even though they do not have the lowest premiums over spot. Tens of millions of the coins are bought each year by silver investors in the U.S. and overseas. And this has a lot to do with the fact that these coins are also collectibles. 

Many of those who started out buying a roll here and there, or perhaps a monster box of 500 coins when spot silver was at what they thought was an attractive level, have gone on to build complete sets of these coins, including the special versions for collectors, the proof and burnished coins.

The burnished coins, which the U.S. Mint refers to as uncirculated coins, have a more matte finish than the uncirculated bullion examples, and they are struck on specially burnished planchets and handled more carefully than regular bullion coins. PCGS recently began designating the burnished coins issued since 2006 that have a “W” mintmark for West Point as “SP/burnished” as opposed to the bullion versions, which are designated as mint state.

In addition, many stackers also become interested in coins from other countries, especially since many foreign bullion coins, whether modern or older, sell for the lowest premiums over spot.

So they may acquire low-priced foreign bullion coins, and then over time they want to learn more about their coins. That may then lead them to develop an interest in more recent releases from other countries, which is another major area of modern numismatics.

Modern world coins are being released by an ever-growing number of countries in an almost endless variety of designs using all kinds of innovative approaches. 

Finally, another type of coin that is increasingly popular precisely because it straddles the stacking-collecting divide is collector coins that are priced close to their bullion value at least when first issued.   

Perhaps the best example of this type of coin is the silver Libertad series.

While their primary goals and motivations may initially appear to be different, stackers are often collectors too, and collectors like to stack as well. In fact, doing some of both is a good way to diversify one’s assets instead of putting too much in one area or the other, which makes it subject to a lot more volatility and potential downside if either precious metal values or numismatic premiums decline sharply. 

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