Why Invest In the rare Nelson Mandela Coins?

The Mandela rare coins (Mandela 90th Birthday R5, 2011 SARB 90th Commemmorative Anniversary R5, 1994 Presidential Inauguration R5, 2000 Nelson Mandela Smiley Millennium R5) continue to increase in value each year.

As more and more investors and collectors from around the world enter the market, their value increases more due to supply and demand.

South Africans in particular, hold these coins dear, either as a memento of an era or for holding something that has been part of this remarkable man. From these special interests, these coins will always be a lucrative investment.

To date, the Nelson Mandela coins are the fastest growing coins in the world when it comes to value and interest.

 

The MS69 Nelson Mandela 2008 90th Birthday coin is the finest known uncirculated coin.This coin was sold for R2.5 million. Extremely rare.

 

Mandela R5 continues record run

By Chris Woltermann WORLD COIN NEWS April 2012  

It was not a fluke when, in 2009, a newly minted and briefly circulating South African coin rocketed to fame as the world’s most rapidly appreciating numismatic asset. Four sound reasons, the highest graded examples of the 2008 Mandela 90th birthday R5 (5 Rand) continue their unprecedent market ascent.

News of retired South African president Nelson Mandela’s recent hospitalization (February 2012) spurred me to re-examine his birthday coin that I last discussed for World Coin News readers three years ago. What I learned will excite even the most jaded collectors and investors. The highest graded examples of the 90th birthday R5 in early 2009 were six MS-68s. Each of three had sold for R100, 000, then about US$10,000. Just months before, these coins were worth face value, about US 50 cents apiece. Today’s finest known specimens are 12 MS-69s out of more than 140,000 pieces graded by Numismatic Guaranty Corporation (NGC) and Professional Coin Grading Service (PCGS), the only such firms respected in South Africa. A single MS-69 was recently sold by a South African dealer, for R2.5 million, an astounding US$334,250 at the current exchange rate. How does one explain this price for a coin whose mintage and release to the public was 5 million pieces? How does one account for the price when the coin is only four years old, when neither minting errors nor die variations are involved? The South African public’s reverence for Mandela made his new coin coveted even before its release. Then, upon release, most examples moved from the banking system’s distribution network to people’s intent on holding them for their symbolic association. Some few coins circulated, though only fleetingly, in stark contrast to pre-release planning. Failure of the birthday R5 to circulate coincided with the abrupt rise of an updated numismatic consciousness among South Africans. Almost no sooner had it taken hold among the collecting elite than it permeated the general public. Its core was a new appreciation of modern coinage.

South African collectors had formerly focused exclusively on “old” coins and/or those modern issues commonly designated as non-circulating legal tender. Quite suddenly, it seemed, South Africans began to wonder about the rarity of modern business strikes exhibiting the highest quality imaginable. Might they be much rarer, and thus extremely desirable as collectibles, than anyone suspected? Answering this question required resort to expert graders to serve as arbiters of coin quality. Some farsighted South Africans started to submit their country’s modern business strikes to the big three American grading services. Such submissions grew with exponential rapidity, and South Africans soon became as enthusiastic about professional grading as are Americans. The question about the rarity of the best South African business strikes has been answered. They’re extraordinarily rare. The relative numbers of the birthday R5’s business and proof strikes are illustrative. As noted earlier, of the 5 million business strikes, more than 140,000 have been graded, resulting in a mere 12 MS- 69s and no MS-70s. Only 5,000 of the gorgeous proofs were struck, and approximately 80 per cent of them have already been graded. There are 58 PF-70s and 1,964 PF-69s. Recent selling prices reflect the relative rarities. The prices are R2.5 million for a MS-69 versus R125, 000 for a PF-70, a ratio of 20 to one. Additional submissions of uncirculated birthday R5s may well leave the market momentum of heretofore graded coins intact. The coins with the most obvious potential for the highest grades probably have already been submitted. Then, too, the longer those coins remain un-encapsulated by a grading service, the more susceptible they are to mishandling and environmental damage. Furthermore, if the American experience with vastly increased numbers of graded Morgan dollars is indicative, a growing population of birthday R5s will actually enhance the market by drawing in new collectors. Lest there be any misunderstanding, factors other than rarity also lie behind the phenomenon of the birthday R5. There is the coin’s importance as a component of the six-coin set of Mandela R5s. Collectors seek to assemble sets consisting of the business and proof strikes of the 1994 presidential inauguration coin, the 2000 presidential coin, and the 2008 birthday issue. The birthday proof may be the set’s sleeper. Its mintage is far less than those of the two other proofs. All of South Africa’s Mandela business strikes benefit from their status as true, meant-for-circulation coins. They stand in sharp contrast to the ostensibly Mandela-related trinkets marketed as medallions or non-circulating legal tender by foreign mints and unscrupulous promoters having no connection to Mandela other than a determination to capitalize on his name while duping collectors. The allure of all South African Mandela R5s as real coins extends beyond South Africa’s borders to foreign collectors and investors. I’ve heard that the coins are traded even in Dubai, but I can’t verify that. Interest is certainly picking up elsewhere, especially Australia, but also Europe and North America. The birthday R5’s stunning market run will not end soon. All three Mandela coins will, unless foolish politicians get in the way, continue to draw pricing strength from South Africa’s prudent practice of not taxing the profits from rare coin transactions. This is a tremendous boon to the domestic market with positive effects rippling globally beyond it. Collectors everywhere and investors too, I believe, should be grateful for the role of South Africa’s Mandela coins in our numismatic universe. As business strikes, they provide irrefutable evidence that real coins – coins minted to serve as money – remain the foundation of our passion.

 

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