Buying On The Secondary Market - Deftly Avoiding the Primary Market Premium

There is something special about buying a new coin as soon as it's been released. A scarce and attractive collectable related to a current event is a memento the whole family can reflect on, value and enjoy for years to come. That value can be worth the issue price alone. If you're a collector and you truly want a current coin or set for that purpose, it doesn't really matter if the secondary market has a different dynamic in the years to come.

If you're not fussed about buying new coins though, then as a collector, you have a much broader range of choices available to you. Namely, all of the coins that are available on the secondary market. The downside of buying on the secondary market is that we each need to make a lot more decisions about what we're going to buy. What mintages will we accept? What premium are we prepared to pay? How many of each are we going to buy? Answering these questions is truly stressful for some collectors, while others treat the decision making process as something to value and relish rather than dread.

This article is intended to help guide a new collector in your learning phase to make it as easy as possible. With a few positive acquisitions under your belt, you'll be confident in your own decisions and won't need any guidance at all.

Buying On The Secondary Market - Success Is In Our Hands

Collectors who buy their coins on the secondary market are clear they're avoiding the primary market premium that is built into pretty much every modern coin that's ever been made. In my experience, most modern coins made of precious metal sell for a premium of anywhere between 5% and 30% over their metal value. There are exceptions of course, but in my 3 decades of experience, I've seen most modern precious metal coins made by Australia's mints fall from their issue price down to a premium that sits between 5% and 30% over their metal value. Fortunately, as precious metal prices have risen, that lost premium is often recovered, but not always.

So how "should" you pick the first coin for your collection? There's no right or wrong way - you can buy completely on impulse, you can click on a Tik-Tok influencer's link or you can work it out all by yourself. If you do want to bring some thought to it, the choices I suggest you get across follows. Keep in mind, you'll probably only need to go through this laborious box-checking exercise no more than once or twice, get those under your belt and it'll be easy-peasy after that:

Step 1: Pick a metal. It doesn't have to be the one you'll always stick with, but pick just one to start with.

Step 2: Pick a size. You can go as small as a half a gram, you can go as large as a kilogram. It doesn't matter what size you go for, but as you're starting out and our first purchases are about learning and minimising risk as much as they are about adding to our collection, go for a size that isn't going to break the bank if you unintentionally pay a premium.

Step 3: Pick a year and a format. If you're thinking of getting a 1/10oz gold coin, for the sake of looking just focus on one date so you can learn about it as quickly as possible. Why? Researching one date takes less time than learning about the whole series. Once you've picked a date, work out whether you're going for a proof, UNC, reverse proof, gilded proof, high relief proof or whatever other variations there might be. Not every coin or set has a range of different forms, but some do. Again, picking one type of coin makes the research process quicker.

Step 4: Now learn what the range of prices are for that coin. Start off looking only at those that have sold recently, not those that are being advertised for sale. Why? In 2025, an advertised price online is no guide to what a coin will actually sell for. A market that's open to all means a collector can advertise their coin for whatever they like. Some desperadoes that grant themselves the gift of the gab try asking for exponentially more than what their coins are worth, reasoning that even if they only get more than twice what something is worth they're well in front. Advertised prices from fools like that don't help the rest of us though, so we need to filter them out to begin with.

Auction websites (eBay and otherwise) allow you to look at historical prices or sold prices only - they are what we need to look at if we're to get a guide to how the market actually values a coin. We've recorded a link that shows how to look up sold prices on eBay, watch that to see how we recommend you do it. eBay definitely isn't the only place coins are bought and sold, but can be a transparent market if you know how to filter out the liars, thieves and charlatans.

Step 5: Armed with that pricing information in mind, we can now start to look around for potential acquisitions. We know exactly what we're looking for and we know exactly how much we need to pay for it.

Step 6: Assess the seller. Yes, before you even consider buying a coin that looks to be the right price, you need to check the legitimacy of the person or business selling it. Are they likely to actually have the item they're selling? Is it likely you'll actually get what is being advertised? You might think these questions are boring and unnecessary, but so did those people who got stiffed because they didn't check things out before they pulled the trigger. Once you've picked up a few coins, you'll no doubt have a shortlist of trusted sellers and won't need to go through this labour again.

Step 7: Assess the coin. Finally! This is where we try to make sure a potential acquisition is going to meet our criteria. If it's a proof, is it in the box and with the certificate? If it's a standard bullion coin, is it undamaged? The images and description provided by the seller should make these characteristics evident, if you're not sure then by all means ask. It's foolish to expect perfection, but we should expect reality to meet the advertisement.

When contacting a seller, do be polite - there's no quicker way to alienate a potential business partner than to launch into an interrogation when it's not warranted.

Step 8: Pull the trigger.  Once all your ducks are lined up, there's nothing else to do other than to place the order and make payment.
If all of that works out, congratulations! The next step to becoming a collector is to rinse and repeat. Learn as you go along and enjoy building a collection of attractive and scarce precious metal coins.

This is a great area of the market to be in, great value can abound if you know where to look for it.