Chinese currency and banknotes: 'Here's a great collectible that you can always bank on'



2015-06-26 12:14:20

Chinese currency and banknotes: 'Here's a great collectible that you can always bank on'

Spink's World Record $308,000 Chinese banknote sale is only the latest in the currency bull markets

Last month (January 22), a roomful of excited bidders at Spink's Hong Kong auction stood gazing upon a one dollar banknote. When bids on the note closed, the banknote's new owner took it away for HK$2.4m (US$308,000)- a World Record price.

Why did a one dollar banknote sell for such an astronomical value? Well, it helped that note from a bank of China's Henan (or Honan) Province dates to the year 1908, the era of the Qing Dynasty. And, aside from its age and wonderful design featuring ornate dragons, there was also some mystery surrounding it...

The printed date on the note's reverse is 1904, while the issued date is 1908. The reason for this is unknown, and the banknote'smystery combined with its age and rarity (it is numbered 100) saw it bring a world-auction record for a classic Chinese bank note.

If it has never appealed to you, then you may wonder what drives people to collect coins and banknotes. You might find it as mysterious - and baffling - as a date misprint on a $1 Qing Dynasty note.

Bank of Honan Qing Dynasty banknote The $308,000 World Record Bank of Honan Qing Dynasty banknote

Yet here's a question: do you have any interest in history or geography, or a desire to hold pieces of history in your hand? If yes, then numismatics (coin collecting) or notaphily (banknote collecting) could be your next great passion.

Even better, collecting coins or banknotes can give you access for one of the most reliable and secure collectible investments. If you don't believe me, then it's worth looking at a study by Dr Raymond Lombra, Dean of Economics at Penn State University, US...

Dr Lombra's excellent study is entitled "Managing Portfolio Risk: An independent economic analysis of the investment performance of rare US coins..." The study looked at how a number of diversified portfolios performed between 1979-2003.

AmongDr Lombra'sconclusive findings was that the portfolios with the highest rates of return each had 5% invested in MS65 (meaning high quality) graded US coins or gold. And these findings would be even truer in today's financially uncertain market. Rare and historic coins and banknotes have traditionally gained value in inflationary periods.

History in your hands: this 'excessively rare' Italian Renaissance GoldCoin is among our coin stock items for sale

While Treasury Bonds and other mainstream investments move sideways, there have been raging bull markets for rare coins and banknotes in recent times. The World Record $1 Qing Dynasty note sold at Spink Hong Kong is only the latest example.

Recent stats show that there are around 250,000 serious coin investors in the US alone (with a further two million "average" collectors and a whopping 50 million "casual" collectors). And that says nothing about the growing markets in places like Hong Kong.

What's more, the market has adapted to growing interest over the past 20 years. If you're a "newbie" to coin collecting, then the growing numbers of reputable dealers, the internet and third-party grading services means it's easier thanever for you to get involved.

Watch this space for upcoming blockbuster sales in the rare coins and banknotes markets. Or you can find out more about numismatics and notaphily by reading our special coin investment pages - and view our selection of rare coins for sale. Alternatively, for more information, contact us at:

+44 (0) 117 933 9500

All the best, until next week


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