Revealed: major rarities trading below their fair values

The Stamp Man

The Stamp Man

2020-07-28 10:04:51

Why Modern British Stamp Errors have never been a better deal than they are today

One of my most favoured strategies when investing in the stock market is… 

  1. Buying in to companies after a major fall, if…
  2. they are high quality companies, and…
  3. their shares are on the start of an uptrend

It has served me well… most of the time. 

It doesn’t always work.

There are so many variables which can derail what is, logically, a sound investment strategy…

What if the company isn’t as high quality as it seems and has hidden problems? What if the uptrend is a false start? What if some new unforeseeable future event damages the business? (Covid-19 being an extreme case in point).

Any experienced trader in the stock market knows what I mean.

But, I’m no stock market guru. I’m the stamp man!

And… this same stock market strategy can also be employed in selecting the rare stamps most likely to grow in value.

However, the stamp market is much simpler to get right. Here’s the simple checklist of what to look for… 

  1. An area of the stamp market showing a recent fall in value
  2. Selecting only very rare stamps of pristine unmounted mint quality
  3. Where recent auction realisations are showing current growth and clear support from a rising number of buyers 

In short, it is about identifying an area of the market where you can currently buy high quality rarities that are undervalued.

One thing you should know…

The stamp market is an imperfect market. It is not always the case that very rare fine quality stamps command a high price.

There are some rare stamps out there you can buy for much less than their rarity would suggest would be a fair price.

In assessing whether a rarity is trading below its fair value, I calculate the market capitalisation of the stamp…

In other words, a stamp where there are 100 known examples selling for £10,000 would have a market capitalisation of 100 x £10,000 = £1 million.

To illustrate this by way of a real example, there are 306 known mint examples of the famous “King’s error”, the Prussian Blue stamp, which has a market value of £18,500. The market capitalisation of the Prussian Blue is therefore £5.7 million. This is a famous stamp, however, and worthy of its premium value. 

What I look for is situations where there are a relatively small number of possible examples yet the current price remains modest.

The vibrant market in British Modern stamp errors

The market prices for British Queen Elizabeth II (1952-) stamp errors have taking a battering in the past five years.

Yet, this area of philately is one of the fastest growing in terms of popularity.

Printing errors on stamps appeal to a wide audience of collectors. Some collectors focus entirely on building a collection of stamp errors. Others purchase errors as showpiece items within their collection.

They are unintentional mistakes in the printing process creating some of the rarest and most visually striking stamps in the world.

Despite modern automated printing processes reducing the number of errors occurring, no system is perfect. A small number of mistakes can happen despite rigorous quality controls in place throughout the process.

Because they are so rare the reign of Queen Elizabeth II has become the golden era of British stamp errors for collectors.

We are now seeing prices rising at auction again. We have also personally experienced an increasing number of collectors buying modern errors from us in recent months.

The positive market indicators are there. We could well be entering the next bull market in this key area of stamp collecting.

The QEII Modern Errors Collection

I have taken the time to collate an attractive selection of 20 Queen Elizabeth II modern errors to create a collection for you.

These stamps are all: 

  • Very rare
  • In pristine condition
  • Visually appealing
  • Trading at a price below their rarity factor fair value. 

CLICK HERE TO VIEW THE COLLECTION

Let’s look at some numbers…

Whilst I’m better known as the stamp man, I’m also a Chartered Accountant…

I use spreadsheets and statistical analysis more than anyone else in the stamp business.

The 10 Statistics you need to know about this collection 

  1. The 20 stamps in the collection have risen in value by 227% in the past 20 years 
  2. The collection has fallen in value by 16% in the past 5 years 
  3. The highest growth period was 2005 to 2010, where the collection increased in value by 137% 
  4. 6.1% annual compound growth rate over the past 20 years, even with the 16% fall in the past 5 years 
  5. Currently trading at just above the price levels last seen 10 years ago 
  6. The highest growth stamp in the collection increased by 900%; poorest performer was still up 50% and that was a very modern error from 2003, which needs a bit more time to mature 
  7. The best value stamp, based on market capitalisation, is the 1970 5d-1s9d Anniversaries illustrated first day cover 
  8. The rarest item in the collection is the 1966 4d birds, left hand marginal block of four – only 2 in existence and valued at £20,000 
  9. The average market capitalisation for the stamps in the collection is only £60,000 
  10. The market decline since 2015 has bottomed out in the past two years with prices being flat since 2018 

Here’s the deal

There are 20 stamps in the Queen Elizabeth II Modern Errors Collection with a total current catalogue value of £109,150.

The collection is available to you today for the round sum of £100,000, 8% discount to current market values and 23% below the market value of the collection five years ago.

So, not only are the stamps (in my opinion) undervalued by the market, you are buying in at a further discount to the Stanley Gibbons listed catalogue prices. To coin a well-used phrase from Benjamin Graham, this gives you an added margin of safety.

In the future, if and when you decide to sell the collection, we will be ready on hand to help. We can offer you the following options with the aim of realising the best price in the market at that time:

  1. We may offer to purchase the collection from you directly at an agreed price 
  2. You can sell through our online auctions. We would not charge you any vendor commission in accordance with this option  
  3. You can sell through another reputable auction house, by arrangements we have in place, providing preferential sales terms 
  4. You can instruct us to actively market your collection to our worldwide client base at the full market value at that time 

Some highlights from the collection

Here are a few highlights from the collection to whet your appetite…

Rare and visual error of missing colour for under £1,000

Great Britain 1961 3d Post Office Savings Bank (Timson Printing). Superb unmounted original gum example with orange-brown omitted, offered with normal example for comparison. Scarce. SG624Aa 

PRICE: £600

BUY NOW    

  • Stamp issue to commemorate the Centenary of the Post Office Savings Bank
  • The first stamp to commemorate the Post Office. All previous commemorative stamps were based on famous anniversaries.
  • One of only 80 mint examples in existence

The most undervalued rarity based on market capitalisation

Great Britain 1970 5d -1s9d Anniversaries, events described on stamps, SG823a.

Very fine used cover bearing a 1s9d with lemon (trousers and document) omitted, neatly tied to an illustrated first day cover by a London W.C./First Day of Issue circular date stamp for AP.1.1970.

PRICE: £6,000     

BUY NOW

  • Important Anniversaries stamp issue from 1970 including:

5d – Signing the Declaration of Arbroath

9d – Florence Nightingale attending Patients

1s – Signing of International Co-operative Alliance

1s6d – Pilgrims of Mayflower

1s9d – Sir William Herschel, Francis Baily, Sir John Herschel and Telescope

  • Accompanied with a 2012 British Philatelic Association (BPA) Certificate of Authenticity
  • Extremely scarce error. Pierron records only 3 examples used on First Day Covers.

Undoubtedly the most spectacular Queen Elizabeth II error

Great Britain Queen Elizabeth II 1966 4d Birds (Ordinary paper), SG696ab.

A superb unmounted original gum left hand marginal block of four with black, blue, bistre and reddish brown omitted, offered with normal block for comparison.

The error results in the loss of value and inscription on all stamps. Also affected are the gull's head, wing detail and water shading; the blue tit's feather detail and branch shading; the robin's wings and legs; and the blackbird's body and legs. The error existed in a cylinder block of eight but was split into two blocks of four in the late 90's.

PRICE: £20,000     

BUY NOW

  • Considered the most “visual” of Queen Elizabeth II stamp errors
  • Birds are the most popular stamp collecting theme worldwide
  • Interestingly, this major rarity did not fall in value in the past five years, illustrating how the top rarities hold their value even in the worst of times
  • There is only one other example of this block of four in existence making it a major rarity of British philately

The Collection of Queen Elizabeth II Stamp Errors you can own today

To summarise: 

  • A collection of modern British stamp errors which represent value at their current prices in comparison to their rarity factor 
  • Available at a 23% discount to their market value five years ago 
  • A collection almost impossible to replicate in this quality 
  • A growing in popularity area of collecting evident from recent higher prices being realised at auction 

The entire collection can be yours today for a price of £100,000.

To secure this collection at this price, please e-mail me at mike@paulfrasercollectibles.com. 

Alternatively call us today on +44(0)1534 639998.

Remember, these stamps increased in value by 137% in five years from 2005 to 2010. This could happen again.

If the £100,000 collection is outside of your budget, we can build you a tailored collection of Queen Elizabeth II stamp errors to suit your budget. Just let us know.

Kind regards 

 

Mike Hall

CEO, Just Collecting Limited

PS. Just to remind you of the additional benefits you enjoy buying from Paul Fraser Collectibles. We provide you with:

  1. FREE lifetime moneyback guarantee of authenticity
  2. FREE delivery to anywhere in the world
  3. Secure storage and insurance in the Channel Islands, if required

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