Investing in guns


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smokey30725
February 29, 2012, 11:07 AM
I am seriously thinking of investing in guns as part of my savings for my kids. They usually get savings bonds at birthdays and Christmas but with our current track record economically, I think I might cash them out and invest in guns. These would be put back for a good 15 to 20 years. I thought about surplus C&R guns and my local gun store gets some nice classics now and then. Right now they have a mint stevens model 67 pump 410 and a Winchester 37 youth 410. Any thoughts? Anything you guys would purposely steer clear of?

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lowerunit411
February 29, 2012, 11:18 AM
guns are a poor yielding investment as a rule. there are far better investments. Maybe not as "fun" but higher yields and more liquid.

mdauben
February 29, 2012, 11:20 AM
If you make your purchases with informed care, you can be fairly certian that you won't lose money on a gun purchase, but as a general rule there are certainly "investments" with better return on your money than guns.

Coyote3855
February 29, 2012, 11:23 AM
I wish I'd bought a truck load of Webleys, Smith/Colt 1917s, British Enfield rifles, etc. back in the 1960's when they were selling for under $20.

lathedog
February 29, 2012, 11:35 AM
Yeah, one of the gun mags had an article about 10 or 12 years ago showing that a savings account at 3% blew guns away for yield over the last 100 years.

However, guns are largely inflation proof, and always retain some value. Guns have immediate practical value as well.

The trick is knowing what to buy. If you are serious about the investment value, you should do some careful study before purchasing. Find a quality name brand firearm where the sale price is low compared to intrinsic value; plan on locking them away for a long time. Good quality mid-ranged guns will increase in value faster than cheap junk and will hold value better than high end premium collectibles in a bad economy.

My advice would be to get a case price on Mosin 91/30 rifles. They are flooding the market right now, and can be found for $70 to $80. We've seen how imported military bolt action rifles have performed after the glut supply on the market dries up. This has happened with even less desirable models like Carcanos.

Another possibility I would consider would be SIG 2022 or FNP in 9mm. Check out what they are going for in stores, and compare to similar guns from other makers. I think they are screaming deals right now. Buy new and lock them up in your safe.

Further advice: Stay away from low priced imports unless they are an unmodified military surplus weapon. Don't expect to see a quick turn around, and don't put more than 5% to 10% of your net worth into an investment like this.

lowerunit411
February 29, 2012, 11:42 AM
i think putting 10percent of your net worth in guns as an investment is just pure foolish. they are a poor investment

smokey30725
February 29, 2012, 11:48 AM
Thanks for the replies so far. And to be clear, this would be a long term supplement to the savings account and cds that I already have for them. I had thought the same thing about a case of mosin nagants. Other than a large purchase like that, it may be one gun purchase every year for the sole purpose of locking away for a decade or two.

DesertFox
February 29, 2012, 12:08 PM
I wouldn't want all my funds tied up in cash, gold, guns, stocks or anything. A diversity of financial instruments seems to be safest. And don't forget about ammo, which could be seen as equally important. All the guns in the world are useless without ammo to feed them.

I think of it more as "squirrelling away" than investing.

Justin
February 29, 2012, 01:41 PM
Unless you're investing in extremely rare and high-grade collectors firearms from, say, Purdy or Holland and Holland, guns are a terrible way to invest money.

AT BEST, they will track with inflation, and that's assuming you keep them in the box and completely unfired.

I'm not a financial advisor, but you'd be better off finding and investing the money in a mutual fund that's performed alright during the current turmoil, or if you don't want to invest in paper or stock, buy precious metals.

Guns are a terrible investment.

liberty -r- death
February 29, 2012, 01:49 PM
Investing in guns is not wise for future financial gains for the most part. Either you don't make very good returns or the gun is rare and gains so much value it eliminates many average buyers limiting your ability to sell in some cases.

However, I do think that guns will be far more valuable in the near future if things don't start to change with the way the government has been doing business. No matter what the media is feeding the public, there is a real chance for econimic collapse here because of what is happening abroad as well as what has been happening at home.

Give me guns and ammo over gold or paper any day of the week.

I invest heavily in lead, and I'm an alchemist. I can always convert lead into gold, food, or water.

firesky101
February 29, 2012, 02:01 PM
Money could be put in more lucrative places, no doubt. Of course there are exceptions to the rule, if only I had the ability and foresight to buy a trainload of SKS's in the 90's... Sigh.However, if you are looking for an excuse to put some more in the safe, go for it. You will get no argument from us.

guyfromohio
February 29, 2012, 02:05 PM
It's a very cool thing to do for them, but not for the purpose of financial gain. Remember that "worth" is dependent on what someone will pay.

mgmorden
February 29, 2012, 02:18 PM
I wish I'd bought a truck load of Webleys, Smith/Colt 1917s, British Enfield rifles, etc. back in the 1960's when they were selling for under $20.

Probably still not TOO bad a return, but $20 in 1960 is worth around $150 today (adjusted for inflation). Nothing under $150 would be considered profit on the sale. You can't just compare flat sales price across decades and have the numbers mean anything.

smokey30725
February 29, 2012, 02:28 PM
Thanks for the advice. I am going to do a lot more homework before buying anything.

jcwit
February 29, 2012, 03:15 PM
All depends what you're buying and how much you pay for it.

Bought a Winchester 52B a few years ago, it was in near new condition and complete as when it orginally was sold in 1948, only item missing was the cardboard box it came in. Even came with a Lyman TargetSpot. All for $50.00, I guess that was a good investment. This is only one of many of my "good" investments.

Ryanxia
February 29, 2012, 03:15 PM
It IS however a fantastic investment if we have an economical/financial meltdown.

If you have gold/silver and food and I have a gun, guess which one of our family's going to be eating :)

firesky101
February 29, 2012, 03:25 PM
This is a good discussion, let us just keep it highroad.

oneounceload
February 29, 2012, 04:02 PM
Want to make money for your kids? Get in on one of the tech world IPOs, or even stick with some good old standbys like Exxon, GE and the like - they generate growth and returns, something guns do not

leadcounsel
February 29, 2012, 04:49 PM
I think that as part of a portfolio they are a good investment, provided you are buying at below market value, which means you immediately capture value.

Buy used, quality guns.
Buy bulk ammo.

At worst you'll break even, keeping pace with inflation. Provided you don't buy new, you'll never LOSE money. That's not a terrible hedge.

Guns/ammo are very liquid.

Just be careful not to become a gun dealer - you need a license for that!

JustinJ
February 29, 2012, 05:10 PM
I think if one had enough info on availability of old milsurps they could do worse for an investment but the key is timing. Many rise quite rapidly in price as inventories dry up but good luck predicting when that is going to happen. If one were to try it i'd say an FFL and funds to buy wholesale would be a must to offset dealer fees. Of course you now have the additional costs of securing and insuring said investment. After the last election i'm thinking buying a ton of AR lowers and selling them in four year cycles may be an easy money maker.

22-rimfire
February 29, 2012, 07:33 PM
Any thoughts? Anything you guys would purposely steer clear of?

Buy what you like so that if you don't make any money down the road, at least you like 'em.

If you want to pursue this investment approach, buy Colts, S&W (pre-1990), and old Winchesters in as perfect condition as possible and don't shoot them. The problem with guns is they are not very liquid. You can't run short this month and expect to sell a gun quick at market prices to pay the rent in two weeks.

nyrifleman
February 29, 2012, 07:44 PM
I wouldn't buy guns as an investment. Since you're saying this is supplemental to other investments, I would buy physical gold. That way, if the market is bad and the other investments lose money, gold will be up.

Guns? Leave them an heirloom or two :)

beatledog7
February 29, 2012, 07:49 PM
If you buy a used gun and don't let it get trashed, it will likely hold its "value" until you are ready to sell it again (or trade it for something you need more). Breaking even is better than most investments will be able to manage over the next ten years, I'm thinking.

Ammo would seem to be a pretty good investment also, if you believe the economy will inevitably burst.

hso
February 29, 2012, 07:50 PM
A collection isn't a good investment unless you put a lot of effort into learning all the various details of the history of the firearms you're buying.

AlaskaMan
February 29, 2012, 07:54 PM
Buy good quality firearms and teach them to use them responsibly.

That way, when you want to present them with the firearms they'll have a good quality piece that they know how to use, and the memories of you teaching them. Maybe they'll pass it on to their kids.

That sounds like the good investment.

JO JO BANG
February 29, 2012, 07:57 PM
get it and shoot it, have fun

nyrifleman
February 29, 2012, 08:25 PM
Buy good quality firearms and teach them to use them responsibly.

That way, when you want to present them with the firearms they'll have a good quality piece that they know how to use, and the memories of you teaching them. Maybe they'll pass it on to their kids.

That sounds like the good investment.

+1 on that.

Buck Kramer
February 29, 2012, 08:33 PM
Whatever you invest in, know your product. A Browning A-5 made in Japan does not equal one made in Belgium. The only way guns can become close to a good investment is if you KNOW it's a good investment.

leadcounsel
February 29, 2012, 09:09 PM
I think it also hinges on your outlook of the country and the world prospects.

If you think that America is going to keep going along at the same pace and most things on the horizon are positive, I would expect guns to stay flat. Meaning that as long as you make sensible gun purchases (buy quality used guns) then you'll break even, maybe make a small profit. Also, niche historical guns may command a premium if you can buy something, learn the history, and there is antique or unique quality. Same with ammo.

However, if you are pessimistic about the future and you see a lot of civil unrest, high volatility in the markets (stocks, oil, precious metals), then guns and ammo will be among the most valueable items. It doesn't take much for the .gov to turn off the NICS checks and for shelves of ammo to run dry. As we've seen in NOLA, the LA Riots, and around the world, civil unrest can occur nearly instantly and as fast now as the speed of communication. With the REAL problems the US faces (debt, oil, poverty, unemployment, 10+ year war, etc.) one could say that we are in for a long strecth of bad times. We've seen what happens to guns/ammo prices when there is some concerns - during Obamascare or after 911, prices went north overnight and supplies dried up. Imagine a shortage of anything that is in the supply line of guns/ammo. Oil, gunpowder, primers, copper, you name it... Buy it while you can if you are pessimistic about the future.

+1 to teaching others the skills to shoot.

Steel Horse Rider
February 29, 2012, 09:36 PM
The tech crash and the last stock market crash both prove that paper investments can go from valuable to wastepaper in very short order. "Professional" advisors will usually tell you that anything they don't get a commission from is a "bad" investment, but think about things for a moment. Do things of substance have value in hard times? Yes. Is there a ready market for things people want during times of tribulation? Yes. Will you be able to sell those guns in 20 or 30 years and pay for their college? No. Will your kids likely appreciate having a good firearm in 20 or 30 years? Probably. I have a NIB late 1980's Marlin .22 mag bolt action in my safe for one of my grandkids in the future, I believe it will be appreciated.

Seven High
February 29, 2012, 10:24 PM
If you can locate genuine military 1911s that have not been altered in any way for a reasonable price you can generally make money on them in a few years. Or, they would make good heirlooms.

leadcounsel
February 29, 2012, 10:25 PM
What IS a good investment these days???

*Stocks crashed big time in the 2000s.... markets basically flat for a decade. Whole portfolios oblitererated in 2001, then again in 2008. Entire savings just gone. People planning to retire - forced back to work.
*House and property values in most areas peaked around 2003-5, then fell 50%.

*Precious metals soared. Gold is up 2.5 fold since 1999 - factoring in inflation.

What makes a good investment?

I think in many ways it's a tool/tools, hardware and the accompanying software. I know that I could sell/trade any of my guns in relatively short order for at least what I paid for them factoring in inflation. So they hold their value because I bought smartly.

paintballdude902
February 29, 2012, 10:27 PM
sure, guns are a great long long long term investment unless there is something drastic that happens with our gun rights. but they are a pretty crappy short term investment and also remember that collectibles are a terrible form of investment.

TenRingGuns.com
February 29, 2012, 10:28 PM
Excellent idea!

Our economy is sunk, believe me, the worst is yet to come. Prepare now.

Guns will hold their value, will put food on the table, will protect your life, and will always be in high demand.

For strict investment purposes though, I'd go with gold bullion; avoid coins as they have a higher cost.

Whatever you do, don't put money into the stock market, by bonds, or other worthless pieces of paper.

Vaarok
February 29, 2012, 10:38 PM
I'm actually in the midst of a reprioritization, and looking at a 50,000 Reichsmark note in my collection of interesting trinkets, I think an Investment Grade anything is foolish. Desirability hinges on needs-and-wants.

I'd recommend as diversified an investment portfolio as possible AND THEN prepay whatever you can, minimize debt, and try to avoid large savings of money that can be destroyed by inflation. Weatherproof your home, fill your heating tank. Buy a generator. But some extra canned goods. Get a more reliable car. Things of that nature.

Buying Turnbull Winchesters and bespoke shotguns is a hobby, not an investment, and lesser guns are just inflation plus changing market tastes- too capricious and marginal to rely upon.

Psa1m144
February 29, 2012, 10:40 PM
An investment in guns may not return financial gains, but it will be valuable in other ways, ways that I believe are more important than money. In an economic collapse, guns will be far more valuable than any of the other options. Of course, a father wants to provide financial stability as well in the preferable circumstances where there is no collapse. I say that you are on the right track for providing for your kids future. Split your investments into various areas and GUNS should be one of them.

paradox998
February 29, 2012, 10:53 PM
With firearms are like any investment, you need to do your homework and understand exactly what you are buying. If you are going to invest in firearms pick an area or type of firearm and read. The internet is a great source. Then buy as high quality as you can afford. An all matching 1912 DWM Luger in 95% condition will appreciate a lot faster than one that is mis-matched. The market you want to be able to sell to in the future is the serious collector who appreciates your firearm. Better to buy 1 top quality piece than three ok pieces.

klover
February 29, 2012, 11:44 PM
I'm surprised at how many level headed answers say guns are a poor investment.

Same as all other things I own, I put guns in the reference plane of "how would it be if I could never sell it or even come close to cashing it out?" In civil turmoil, any barter would probably not be possible, and you can only reasonably have a few guns to use for your defense/survival when needed. The saying goes:
"Priceless if you need one, worthless if you don't".

Investment and value are not exactly the same. Having had many years of machining experience, a shiny piece of metal in my hands is a piece of art. Another person would quickly want to return my offer to examine what I hold in high regard.

If you consider the fees on even an excellent value, you can still lose compared to real-estate, precious metal, etc. There are many guns I have owned that sky rocketed in value, and many more that have stayed the same or decreased.

Suppose all machine shops had to close their doors? Prices on all guns go up.
Suppose the government passes gun control: Prices go up on only the blackmarket, and down in the "legal market". But beyond the prices, who is willing to live on their knees?

You can also hunt food with these toys.

What is fun to you? Do you enjoy the bruising of a big bore rifle? A few of us here shoot guns instead of pool.

In my case, since I have no one to pass an inheritance, my toys get to be left right where they are; when I die with the most toys (I win).

TennJed
February 29, 2012, 11:51 PM
Poor investment, but one of the few hobbies that will hold value

sedona
February 29, 2012, 11:56 PM
Buy some guns and buy alot of ammo.I found a receipt last week that showed in 2005 i paid $3.88 for a 50 round box of 9mm blazer aluminum.The same box of ammo is $11.00 now and that for federal champions.If I hadn't stocked up back then i wouldn't be able to afford to shoot much today.Also buy some stocks with good dividends and even when the market is down you will still be getting a good return on your investment.

whalerman
February 29, 2012, 11:58 PM
I liked the post about the 3% return on a savings account. What we would do to get that now. It depends on what you buy. If the company goes out of business, that can help. But who knows what the future will hold as far as the value of firearms. Our government may make it so restrictive to transfer or own guns that their value may disappear. I believe that may be the hope of many.

igotta40
March 1, 2012, 12:16 AM
What has not yet been said, but needs consideration- a long term investment in firearms requires careful storage... To include the volume of space required... Also think about the need for safe, secure, moisture free, fire, flood etc. protection, insurance cost, and the effort, time and expense of periodic maintenance. Firearms don't respond well to neglect... Think museum type preservation... For example... A small collection of 19th century Colt SAA revolvers in pristine condition would require a considerable amount of research, capital outlay and maintenance, for a possible return of a small pecentage of inital cost, if a buyer could be located. Something to consider?

leadcounsel
March 1, 2012, 05:39 AM
guns are a poor yielding investment as a rule. there are far better investments.

a savings account at 3% blew guns away for yield over the last 100 years.


Here's what people need to understand: Past performance is not a guarantee of future performance. Times, they are a changin... 3% savings accounts are a very rare breed. Right now to get a guaranteed 3% you'd have to lock in with A LOT of money for a decade on a CD (with penalties for early withdrawal).

So, sure in the aggregate if you just look at the past 100 years anyone can look like a genius and say, this is what did better than that.

But if you were in, say, pre-war XYZ country with stockpiles of guns and ammo, you'd be sitting on a fortune, especially if your currency were immediatley worthless. I've seen some charts that showed the cost of loaves of bread skyrocketed in various nations pre-war. You'd need wheelbarrows full of cash to buy food for the day.

So, the point is, cold hard "cash" and the things we 'think' are valuable may turn out to be fools gold in the end.

It's a smart play to have actual durables like guns and ammo as a piece of your pie.

lathedog
March 1, 2012, 11:55 AM
leadcounsel - I get the feeling you read the first sentence of my post then moved on. I think my overall post agrees with your posts on this topic.

Also, several folks posted that guns are not good investments. I notice they do not say more or provide examples.

22-rimfire
March 1, 2012, 12:46 PM
Lathedog said...The trick is knowing what to buy. If you are serious about the investment value, you should do some careful study before purchasing. Find a quality name brand firearm where the sale price is low compared to intrinsic value; plan on locking them away for a long time. Good quality mid-ranged guns will increase in value faster than cheap junk and will hold value better than high end premium collectibles in a bad economy.

All this is true. The problem is "intrinsic value" versus collector value. There are a multitude of approaches to "investing in guns" or accessories. One essentially is to focus on firearms that are collector grade and you believe will increase in value over the next 20 years at a rate that exceeds a savings account. The other is to buy less expensive firearms and ammunition that you believe can be sold for a profit at some future date at prices below collector stuff. There is appeal here as it is easier to sell a gun for $500 versus $2000 in most cases as there is a much larger potential buyer pool.

The key is to do things smartly and buy at prices that are already very competitive or on the low end of market. Gains from firearms can be hit or miss. This is why I suggest you buy stuff you like. I have guns that have appreciated 10x and others that are worth about the same after 10 years. Knowledge is the key to any investing.

Remember, one home fire can wipe out your entire collection (and the value) unless you buy insurance and then you need to factor in that cost as part of the equation. I still think you do better with other commodities. Buy oil futures, most would say that the price is going up....

Justin
March 1, 2012, 12:53 PM
Leadcounsel, if guns are such a great investment, perhaps you'd care to post information about all of the people who've managed to retire comfortably by investing in guns.

Furthermore, if you've got a strategy for investing in guns that has a reasonable chance of working, please, do educate the rest of us. How do you do your "investing?"

Do you take physical possession of these guns? If so, where do you store them, and, on average, for how long, before selling them? After all, if you want to make enough money to be able to retire, you're going to have to move a lot of iron, and the logistics of doing that, especially if you don't have an FFL, are something I'd be interested in hearing about.

Thanks.

AlexanderA
March 1, 2012, 01:40 PM
Love what you collect and collect what you love! If you study what you like, and put together a collection with a theme and with high-quality examples, the value will appreciate, perhaps a lot. It also helps if you know more about the items you're buying than the sellers do. I've been collecting U.S. military firearms since the 1960's and, frankly, I've made out like a bandit. (It didn't hurt, value-wise, that Congress froze the machine gun registry in 1986. That was like a windfall for me, even though I would have preferred that they hadn't done that.)

StrawHat
March 1, 2012, 01:44 PM
I believe a Colt Model P sold for about $20 when new in the 1880s. You could buy one with a $20 gold piece. How do they relate today?

AlexanderA
March 1, 2012, 01:48 PM
I might add that if you're looking at guns as an investment, don't shoot them! If they're new, keep them new in the box, and keep everything that came with them, including the box itself. If you're a shooter, keep your "shooting" guns separate from your "investment" guns. Depending on the gun, even a little bit of wear can diminish the investment value substantially. That includes holster wear, which is unavoidable if you carry them.

W.E.G.
March 1, 2012, 01:49 PM
It takes only minutes to buy a gun.

It take much more to store it, maintain it, insure it, locate a suitable buyer, pack it, and ship it.

Jimfern
March 1, 2012, 02:26 PM
I have noticed that the Russian capture German mauser ($149) and the Romanian SKS ($100) I bought over 5 years ago with my C&R license appear to have appreciated based on the prices I see people asking for the same now. I wish I had bought a Sig P6 and Walther P38 for the same reason.

That's the only experience I have with firearm appreciation, and since I haven't sold, it's really only speculation on my part.

The only real advice I can offer is that no matter what you invest in, make sure you fully understand it, and the risks, before you put forth any money.

csa77
March 1, 2012, 04:11 PM
compared to normal investments its not that good. i belive silver 20 years ago was only 3$ an ounce,now its 35$

now i dont know how good the return would be if you figured in inflation but here are prices i remember
mid-early 90's norinco sks's were 70$, now were i like the are 350-400.
about ~10 years ago you could buy enfields for 100$
~10 years ago m1 carbines were 400$
hell 20 years ago if you could find one, lee metfords were 200$. now it seems they are all 1,000-1,500

Certaindeaf
March 1, 2012, 04:27 PM
My guns are lacking.. gotta hit those weights!

22-rimfire
March 1, 2012, 04:41 PM
I make more money in one day in my profession than I would selling most guns that will take me weeks to sell and hope that I make a few dollars. Storing a gun for 20 years and selling it for a couple hundred more than you paid is not an investment. It's a hobby which is why the BATF "allows" private individuals to buy and sell on a small scale without being a FFL holder. You're much better off with other investments unless you believe the world going to end shortly... then who cares anyway? Or the "fan" hits and all of a sudden you are fighting for your survival. The reality is that most of us are fighting for our survival every day anyway; but guns aren't involved.

Harvie
March 1, 2012, 05:29 PM
Firearms like Gold are not Investments; they are Commodities. Investments would be Stocks, Bonds, Mutual Funds, ETF's, Hedge Funds etc. You should consider a basket of Mutual Funds to receive Professional Management and to a certain degree, Diversification. You may include U.S. Stocks, International Stocks, Emerging Growth Stocks, as well as, a nice mixture of Bonds. Reach out to a Reputable Mutual Fund family, and Dollar Cost Average the invested dollars. Good luck.

Robert
March 2, 2012, 06:12 PM
Leadcounsel, if guns are such a great investment, perhaps you'd care to post information about all of the people who've managed to retire comfortably by investing in guns.

Furthermore, if you've got a strategy for investing in guns that has a reasonable chance of working, please, do educate the rest of us. How do you do your "investing?"

Do you take physical possession of these guns? If so, where do you store them, and, on average, for how long, before selling them? After all, if you want to make enough money to be able to retire, you're going to have to move a lot of iron, and the logistics of doing that, especially if you don't have an FFL, are something I'd be interested in hearing about.

Thanks.
__________________

How would one retire, since I would assume that is the end goal of most investors, on firearms as an "investment"?

Certaindeaf
March 2, 2012, 08:54 PM
Firearms like Gold are not Investments; they are Commodities..
True, one speculates upon commodities.

Certaindeaf
March 2, 2012, 09:03 PM
^
If you can double your money every seven years, you'd be on par with conventional, long term expectations.

22-rimfire
March 2, 2012, 09:55 PM
Very few guns ever double in value in 7-years.

exavid
March 3, 2012, 12:41 AM
I wouldn't buy guns as an investment unless they were historically valuable or some such. On the other hand guns I bought in the 60s and 70s have held their original value plus inflation so I wouldn't lose any money on the should I sell. I've done a lot better with stocks, bonds and mutual funds over the years, even over the past few years of recession I'm still in pretty good shape. But buying some guns to enjoy gives the profit of pleasure and if they hold their value you are ahead of the game. Just don't dump too much of your money into them. There's risk in any investment, one should be diversified. Not all the eggs in the same basket. A few grand in guns shouldn't be a serious risk but it also won't be a great profit either.

22-rimfire
March 3, 2012, 09:48 AM
I find that many older folks (75+) that have guns they never use anymore or particularly want tend to think their guns are extremely valuable, or have very little value beyond the purchase price 40 years ago or whatever. Essentially two extremes. Like everything else, one needs to do their homework.

Sniper66
March 3, 2012, 10:11 AM
There is a saying out there, "I hope my wife doesn't sell my guns for what I told her I paid for them". When I buy a gun, I record the purchase date, price, and approximate replacement value (for insurance purposes) and I review my list whenever I add to it or remove one I have sold and update the values at that time. I don't do it to make money and never would. I have seen too many estate sales where guns sell for a fraction of what the owner probably thought they were "worth". I buy guns, trade, shoot, reload, and hunt because I love it. And, I know that my "collection" is worth some money, but my dollar for dollar investment return is in the minus column. BUT, the value to ME, over my lifetime is immeasurable.

WinThePennant
March 3, 2012, 10:55 AM
People are having a hard time getting their head around alternative investments. Is a garden a bad investment? How about a fire extinguisher?

Sometimes, alternative investments do MUCH better than conventional thinking, aka investing in stocks. For example, almost every stock fund was DOWN during the period 01/20/2001 - 01/20/2009.

22-rimfire
March 3, 2012, 11:31 AM
I invested in art. Values were climbing rapidly for a number of years. Then during the 2001 > 2009 time frame, the bottom fell out of the market and you couldn't sell them for what you paid for the pieces. Art is very speculative. Guns are too.

AlexanderA
March 3, 2012, 11:40 AM
With savings accounts paying less than 1%, and the real estate and stock markets essentially flat, one has to consider alternative investments. Actually, the best return may be from simply paying down debt. Once you're debt-free, and have excess money to sock away, guns are as good a place as any to put it. But you really have to know what you're doing. Invest in gun books first in order to educate yourself.

Sniper66
March 3, 2012, 11:49 AM
Another thought. I would discourage collecting as investment unless you really know what you are doing. I have a friend who paid $700 for a wooden box, which made me almost choke, until he told me the story. Small cap and ball pistols, when new, were sold in these boxes. The box contained the pistol, a powder flask, caps and balls. As a set in good to very good condition, is worth around $7,000 to collectors. My friend's total investment, as he has toured auctions and gun shows and bought then restored each piece was around $3500. Each time he completes a set he either adds it to his collection, trades it for something else he wants, or sells it. Since he is quite skilled at restoring such items, he has a list of people who will buy from him. So....collecting guns can be a good investment IF you know what you are doing. And a hellava lot of fun.

Old Fuff
March 3, 2012, 01:16 PM
It depends on what you buy, and how much you pay for it.

It has been correctly observed that in the long run some other investments may be better, but today we may be looking at next-to-zero interest rates combined with creeping inflation that can have a substantial affect on the returns that "other investments" provide, or are likely too.

Also I see the words, "long term," but no where is it written that one cannot turn over guns in the short term for a quicker profit, which is reinvested.

From an investment perspective there is a lot of luck involved in buying guns, and the best buys are often unexpected. Like any other kind of investing you absolutely have to know what you are doing, and what the market is doing. I have on occasion doubled my money in less then a week, and I have a friend that once did the same in 15 minutes. :what:

But obviously this was an exception to the rule.

Rather then take your present nestegg and convert it to guns, look for the exceptional buy that others have overlooked. Purchase it and then either keep it for the long run, or make a quick profit if you can. Whatever money you make, reinvest it, but not necessarily in guns. Keep in mind that desireable antiques (not just any old gun) are easier to buy and sell because they aren't considered to be firearms in the legal sense. With any firearm the highest value is usually related to condition, and the original box and accessories can be a big plus.

Speaking of accessories, I had another friend that bought a box of "take-off" revolver stocks that were in like-new condition for $50.00, and eventually sold them for something over $400.00. I consider that was a pretty good investment. ;)

oldbear
March 3, 2012, 01:46 PM
guns are a poor yielding investment as a rule. there are far better investments. Maybe not as "fun" but higher yields and more liquid.

Excellent advise I would suggest you heed it.

I wish I'd bought a truck load of Webleys, Smith/Colt 1917s, British Enfield rifles, etc. back in the 1960's when they were selling for under $20.

Don't we all, but the golden days of cheap quality handguns sadly is over.

Collector grade handguns or anything else are generally not considered liquid assets. By this a mean they have a limited market appeal and are high dollar investments.

Save cash for a rainy day, but also keep the means to defend your family and self.

Elkins45
March 3, 2012, 02:05 PM
Why guns are a bad investment even if you're planning for a doomsday scenario:

"Nice rifle. You look hungry. I'll give you this chicken for it."

AlexanderA
March 3, 2012, 04:01 PM
Another thought is the concept of "arbitrage" -- buying in one market and selling in another. You obviously maximize your returns if you buy low and sell high, but you're unlikely to "buy low" if you confine yourself to traditional gun venues such as gun shops, online gun auctions, etc. You need to cast a wider net, going to rural estate sales, flea markets, yard sales, military vehicle meets, etc. You may not necessarily find complete guns there, but these places are goldmines for parts and accessories. Some people have made a lot of money by trolling rural Pennsylvania estate sales and then selling their findings on GunBroker. (For some reason Pennsylvania is, or was, a very fertile ground for such hunting. Lots of WWI/WWII veterans that were passing away, and a younger generation that was showing little interest in their keepsakes.)

PRM
March 3, 2012, 04:38 PM
AT BEST, they will track with inflation, and that's assuming you keep them in the box and completely unfired. ~ Justin

Not exactly ~ in the 1969 (Shooters Bible) the MSRP for a Colt SAA was $160. They will bring $1200+ easy today in less than mint condition.

All given, the S&W Model 60 listed for $100 in the same book, and you could probably say it has tracked with inflation.

Guns don't necessarily have to remain mint. And, shooting a gun does not necessarily de-value it that much. It's not like a car when you drive a new one off the lot. Care and actual wear are what counts on a gun.

Another more recent example happened to me in the 1990s. I was looking for a SS snub to carry. At that time, I compared a Model 60-9 S&W and a Colt SS DS (SF-VI). They were the same price at that time. I went with the S&W because I liked the feel of it. I didn't know the Colt would be out of production and go out the roof in price.

Would I invest as part of a my assets - NO. Too many variables on what will be desirable in future markets. Too much time to move them and get their worth. Most avenues available to liquidate a collection fast, will charge heavy commissions or low ball you on the price to the point - YOUR profit is in someone elses pocket.


Is it fun to collect a few and possibly pass on as heirlooms, if the interest is there - absolutely. Can you count on interest of kids or grand-kids - nope.

I have a friend right now that is struggling with his family farm. He does not want to farm, and the only heirs are some nephews in another state, who will definitely never live there or be farmers. He would be better off selling now and enjoying what is his, rather than leave it to someone else who will sell it off as soon as it becomes theirs... That's my opinion.

Certaindeaf
March 3, 2012, 04:44 PM
Another thought is the concept of "arbitrage" -- buying in one market and selling in another. You obviously maximize your returns if you buy low and sell high, but you're unlikely to "buy low" if you confine yourself to traditional gun venues such as gun shops, online gun auctions, etc. You need to cast a wider net, going to rural estate sales, flea markets, yard sales, military vehicle meets, etc. You may not necessarily find complete guns there, but these places are goldmines for parts and accessories. Some people have made a lot of money by trolling rural Pennsylvania estate sales and then selling their findings on GunBroker. (For some reason Pennsylvania is, or was, a very fertile ground for such hunting. Lots of WWI/WWII veterans that were passing away, and a younger generation that was showing little interest in their keepsakes.)That's not arbitrage.

AlexanderA
March 3, 2012, 05:54 PM
That's not arbitrage.

Here's the definition of "arbitrage" --

http://www.investopedia.com/terms/a/arbitrage.asp#axzz1o5on7zvC
http://en.wikipedia.org/wiki/Arbitrage

What I said.

Dave in Hawaii
March 4, 2012, 07:56 PM
Citygroup was a great investment for me. I paid over $200 a share back in the 1990's and now it's worth $20 or $25.

I'd say go for the gun if that's what you want to do. It can't do worse than some of the stocks I own. :banghead:

Dave

exavid
March 4, 2012, 10:19 PM
There's no doubt there's an element of luck investing in anything. Guns I own have at least held their value against inflation. My $50 Cold Woodsman match target .22 has done pretty well. I still wouldn't call it an investement. I consider my guns as a hobby that holds its value better than beanie babies. Stocks and bonds historically return around 10% per year. Some win, some lose. I chose a good bit of energy stock years ago that's done well. I've bought a few stinkers too. Overall it's done better than sticking my spare cash in the mattress.

leadcounsel
March 6, 2012, 04:33 AM
Ha! Reminds me of ALL of those valuable stocks that I saw go from hundreds per share to nothing! Worthless. Garbage.

Sure, you *Might* retire by investing in stocks, mutual funds, etc.

How about all those folks now who are in absolute poverty after a lifetime of investing who *knew* what they were doing.

In 2000 I was a stock broker working for a major secuties firm. I literally watched wealthy people lose massive fortunes in their paper investments. Fortunes that heirs couldn't have spent fast enough.

So, "conventional" wisdom isn't so conventional afterall. There are no sure things. But tangible property at least retains inherent value, as long as you're buying it at smart prices and don't chase values up, like gold or real estate.

Sure, if you can look back in time and cherry pick your eras of when which investments outperformed others, then that's a game. Reality is that if you "retire" during a huge collapse, and your assets are tied up in paper or companies that are down 50%, then you are in financial ruin. Those of you that have investments in equities, imagine retiring in 2001, 20002, or 2009 when yours were down 30-50%.

In May of 1999 the Nasdaq was around the same value as Feb 2012, 13 years later! And the swings were WILD. Sure, you might have gotten lucky and made a killing on the way up; more likely you lost your butt on the way down, and the market was south for many more of those 13 years than up! Most people have not faired well in their investments since around 2001, when the markets have been mostly down or flat.

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