Sell R5 Mandela coin for R19 500 to R25 000.
JOHANNESBURG – Was the purchase of a graded, rare R5 Mandela coin a sound investment?
This is the question on a Moneyweb reader’s mind after she purchased a graded Year 2000 Mandela R5 coin (displayed below) in 2007 for R19 500 after being told that it would appreciate in value relatively quickly. (PCGS stands for Professional Coin Grading Services, one of three grading companies recognised worldwide. It is a Proof (PR or PF) coin with a grading of 66 points out of a potential 70. DCAM stands for Double Cameo or Deep Cameo, which means that the impression is better than a normal proof coin.)The reader now needs to sell the coin for personal reasons, but has found that SA Coin Corporation, the company who initially sold the coin, does not buy coins back. The reader may however fill out a mandate form, which would allow the company to sell it on her behalf.
The reader also approached The Coin Company to purchase the coin but was told that since it did not sell the coin initially, it can’t buy it back.
Moneyweb has in the past also written about similar cases where Mandela R5 coins were under discussion. These articles can be read here and here.
Eion Blignaut, senior broker at SA Coin Corporation, says it operates primarily in the rare coin market.
Blignaut says the internationally accepted definition of a rare coin is that it must be a currency coin, the coin must be of historical significance, the coin must be rare and, to be able to be classified as rare, must be measurable. “To be measurable the coin must have been graded on an international quality standard in the USA,” he says. SA Mint was approached for comment on the number of Mandela R5 coins that were minted in 2000, but has not responded by time of going to print. Blignaut says there are more than 300 000 Mandela related R5 coins graded in the world today.
SA Coin had the 1994 and 2000 Mandela related R5 coins graded in the USA from 2005 and placed the graded coins on the market from June 2005, he says.
“There was an exceptional demand for these graded coins from day one. As with any other product the price is determined by the demand and supply of the product. The first proof coins graded sold for R735 each and very quickly reached prices in excess of R20 000.
“The association members inclusive of the SA Mint Company claimed that these coins were worth R5. Interestingly we had to buy the ungraded coins from the SA Mint co at R30 each, have them graded with no guarantee that they will grade and then market the graded coins,” Blignaut says.
He says the 2000 Proof DCAM 66 sold for R735 in 2005.
“The current selling price is around R25 000.”