Numismatics, or the collection of ancient coins, is a practice that is attracting growing interest as the price of gold and silver rises. The diversity of existing coins makes coin collecting equally suitable for investors and history buffs. Between passion, investment and safeguarding historical heritage, numismatics is often a little-known discipline among the general public.  

But why does it make sense to collect these coins? What are the reasons that motivate so many collectors to turn to this fascinating world? In this article, we'll explore ways of collecting old coins that suit everyone's profile, and the benefits of these coins for one's heritage.  

ARTICLE SUMMARY : 

• An investment in history, heritage and precious metals
• Numismatics: an attractive financial investment
• Swiss banks and the numismatic craze
• Essential collector coins for a first investment
• Collector coins minted before 1800: tax advantages
• Coins minted after 1800: different tax treatment
• Numismatics or investment gold?

An investment in history, heritage and precious metals 

A major advantage of numismatics lies in the convergence of several fields: speculation in precious metals, historical wealth and heritage preservation. An ancient coin has several types of value: 

• Firstly, an ‘intrinsic value’, which corresponds to the value of the precious metal contained in the coin.  
• Secondly, a ‘historical value’, which corresponds to the value of the coin due to its rarity. For example, a coin minted 2,000 years ago in small quantities will be worth much more than a coin minted 100 years ago in larger quantities. 
• Finally, we could also distinguish a ‘symbolic value’, particularly for medals or coins of a symbolic nature.  

Unlike a simple investment in gold or silver, buying old coins allows you to combine an intrinsic value (the weight in precious metal) with a historical and symbolic value. As a result, when the historical value of a coin does not exceed its intrinsic value, the value of a coin will naturally be determined by its metal value.  

But when the rarity of a coin becomes great, and its historical value exceeds its intrinsic value, then the price of the coin becomes more difficult to determine. In fact, other factors specific to each coin often come into play: age, state of preservation, historical rarity, motifs, etc. 

Numismatics: an attractive financial investment 

In addition to their historical dimension, ancient coins are also an attractive financial investment. Unlike shares or bonds, these coins offer a tangible investment that is not affected by economic fluctuations. In the event of a crisis, precious metals such as gold and silver generally retain their value, giving collector coins an extra edge when it comes to financial security.  

Depending on the objective, collector coins can offer greater liquidity than gold bullion, better diversification with a wide choice of coins, or better risk control with the presence of historical value. To a certain extent, collector coins can be likened to an investment in ‘art’ or ‘heritage’, offering the advantage of a strong decorrelation to the traditional financial system.   

Swiss banks and the numismatic craze 

Collector coins are attracting the interest of the biggest banks. Indeed, interest in numismatics is not confined to individual collectors. Many financial institutions are beginning to recognise the value of these assets. According to an article published in Le Temps, several Swiss banks have begun to invest in rare coins. This paradigm shift in institutional investment opens up new potential for coins as a stable alternative investment. Some Swiss banks, such as UBS and ABN Amro, are seeing a growing interest in numismatics alongside art.  

Once again, in the face of volatile financial markets, these banks see numismatics as an attractive means of diversification that is both tangible and protected from currency fluctuations. This trend confirms that collecting old coins is not just a hobby, but a genuine asset management tool. 

Collector coins for initial investment 

When it comes to investing in gold, the most liquid and famous French and foreign collector coins are generally the following: 

• PREMIER EMPIRE - 20 FRANCS NAPOLÉON Iᵉʳ TÊTE LAURÉE 1811 PARIS: minted in around 2.7 million copies, this gold coin is emblematic of Napoleon's reign and highly prized by collectors. 
• UNITED STATES - 2.5 DOLLAR INDIAN HEAD 1913 PHILADELPHIA: produced in approximately 722,000 pieces, this coin is distinguished by its recessed design, which is unique in American numismatics. 
• RUSSIA - 5 NICOLAS II ROUBLES 1897 SAINT PETERSBURG: minted in more than 17 million copies, this coin symbolises the last emperor of Russia and remains a sure value. 
• MEXICO - 2 PESOS 1945 MEXICO: minted in several million copies, this coin is highly sought-after for its accessibility and numismatic interest. 

The price of the 20 franc Napoléon fell just 3 times between 2005 and 2020, outperforming most traditional financial investments. In 2000, a Napoléon was worth just fifty euros. Today, a Napoleon is trading at over €500. A 10-fold increase in value in just 25 years! 

Collector coins minted before 1800: advantageous tax treatment 

Collector coins minted before 1800 benefit from special tax treatment. This is because these coins are no longer considered as means of payment in circulation, but rather as historical and cultural objects. 

As the government explains, ‘an item is considered to be a collector's item on the basis of a number of criteria, such as its age and rarity. This category includes postage stamps, archaeological objects, vintage vehicles and coins dating from before 1800. If any of these items is sold for more than €5,000, a flat-rate tax on precious objects is payable. For this category, this amounts to 6% of the price of the item, plus CRDS at 0.5%. 

Consequently, when it comes to resale, pre-1800 collector's items are subject to two possible tax regimes: 

• The flat-rate tax on precious objects (TFOP): This tax amounts to 6% of the sale price, plus a social security levy of 0.5%, giving a total of 6.5%. 
• Capital gains tax: If the seller can provide evidence of the price and date of acquisition of the item, he may opt for taxation of real capital gains. In this case, the capital gain is taxed at 36.2% (including social security contributions), with total exemption after 22 years of ownership (reduced by 5% per year from the third year of ownership). 

Coins minted after 1800: a different tax system 

Coins minted after 1800 are subject to specific tax rules that differ from those for older coins. They may be considered either as collector coins or as precious metal assets, depending on their numismatic value and market quotation. 

Unlike coins minted before 1800, coins issued after that date are not systematically exempt from VAT. The tax applicable depends on their status: 

If the coin is recognised as an investment coin, such as the 20 Franc Napoleon or the British Sovereign, it is exempt from VAT under the rules applicable to precious metals. 

On the other hand, if the coin is a recent numismatic issue or does not meet the investment criteria (purity of less than 900 thousandths, has not been legal tender in France, its selling price exceeds 80% of the gold it contains, etc.), it may be subject to VAT. 

Similarly, the sale of coins minted after 1800 may be subject to two different tax regimes: 

• The flat-rate tax on precious metals (TMP): this tax is 11.5% of the total sale price, including 6.5% specific tax and 5% social security deductions. It applies to coins considered to be investment goods. 
• Taxation on actual capital gains: this option is available if the purchaser can provide proof of the price and date of purchase. The capital gain realised is taxed at 36.2% (including social security contributions), with a gradual exemption from the 3ᵉ year mark and total exemption after 22 years of ownership. 

Numismatics or investment gold? 

In this context, it can be difficult for an investor to choose between numismatics and investment gold. For example, the purchase of antique coins does not meet the same investment needs as a 20th-century French coin.  

Investment coins, such as the 20 franc Napoléon, offer the advantage of being able to buy coins without any particular knowledge of their history. On the other hand, investors wishing to acquire rarer coins may be exposed to a number of risks.  

An essential point for investors in old or rare coins is to have a good knowledge of the market and their history. Rare coins are often the subject of speculation and there is often an asymmetry of information between buyer and seller, which means that the prices quoted can sometimes be far from reality. However, an astute collector can also take advantage of his or her historical knowledge to make the most of good opportunities.  

Each coin reflects a particular period, a sovereign, a significant event or an economic development. Numismatics can therefore be seen as a hybrid between investing and history, providing a better understanding of your country's history and global monetary developments. Clearly, collecting old coins is also a way of immersing yourself in history. What's more, this discipline encourages research and the discovery of sometimes unsuspected treasures...  

Conclusion 

Collecting old coins combines several disciplines: investment on the one hand, but also history and a sense of negotiation on the other. But contrary to popular belief, investing in gold coins is not just for professionals. Many gold coins, such as the 20 franc Napoleon, the US dollar, the rouble or the peso, closely follow the price of gold and are a liquid and safe way to invest in gold.  

Clearly, collector coins offer a unique opportunity to combine culture, speculation and financial diversification. Whether for their historical value, their rarity or their potential for appreciation, vintage coins are attracting more and more investors. With the growing commitment of banks and institutions in this field, numismatics is establishing itself as a serious alternative to other traditional investments. The advantages of numismatics for your assets are undeniable, as there is no comparable asset class, particularly in the field of very old or very rare coins.  

Collecting old coins means investing in history while preserving a unique and fascinating heritage.