First and foremost, stamp collecting, like all collecting
hobbies relies heavily on the meeting of a shrewd seller and a
generous buyer in the realisation of maximum prices. Stamps
collecting, more correctly referred to as philately, covers the
full spectrum of paper based documents associated with the
transmission and delivery of mails, parcels and communiqués. The
breadth of the hobby is understandably vast and comes to include
postal items (message tablets) dating back to the times of the
Phoenicians. The more contemporary collector is more restricted
to items produced since 1840 when the 1st uniform letter postage
stamp was introduced in Great Britain. Suprisingly, these early
items don't command the highest prices despite their antiquity.
Collector/Investors have to be extremely careful when making an
investment in this area, for as with buying a veteran car or a
antique piece of china or furniture, a good knowledge of the
subject material is of far more value than the guarantees or
glossy brochures of the vendor.
Money can be made in stamp collecting but if this is one's sole
objective it may not deliver the returns that one would hope for.
Contemporary material appreciates at around 10% per annum
depending on availability at the time of issue, scarcity in the
case of varieties or production misfits and popularity when
dealing with items that appeal to a wider circle than just the
collecting public. Items of greater antiquity again vary in price
but the scarcest or highest denominated items represent the best
investment or store of value. Good examples are pristine copies
of the 1st Union definitive £1 of the 1913. Although catalogued
at R7,500 in mint unhinged condition, you will be lucky to find a
specimen in perfect condition available at this price. Five years
ago the same item was catalogued at R4,800. Of the post 1910
issues it is most certainly regarded as the most attractive
investment item from the South Africa stable.
Certain countries from Southern Africa are eternally popular and
these include the famous triangles of the Cape of Good Hope and
the Double Heads of the British South Africa Company (BSAC) Era.
In both cases, and in fact as is the case for all philatelic
material, condition is paramount, with triangles, there should be
no thins in the paper, the paper should be in fine clean
condition and a clear or faint postmark is preferable to a
blotchy or smudged defacement. Because triangles were produced in
an imperforate state they were cut from sheets with scissors and
therefore margins tend to be inconsistent, again, extra value
points are scored for items with good wide margins. The stamps of
the BSAC are of particular interest because of their low
availability at the higher value end and also because they are to
be found in various states of condition. Those used on legal
documents, although very attractive compare poorly with those
used in the service of the posts. Manipulation and tampering is
commonplace and care should be taken in examining such items and
having them certified by a professional certification authority
before one commits to purchase.
Certificates are provided by the expertising committees of the
Philatelic Federation of South Africa. Disposing of one's
acquisitions is a little more challenging. The collector-investor
can choose to either dispose of material through one of the
reputable auction houses such as Sotheby's or one of the
specialist Philatelic Auctions of which there are a number in
South Africa. Sell online at one of the online auction sites,
through the classifieds of one of the numerous philatelic
magazines on the market, through auctions at local philatelic
societies, through circulation packets of certain societies or
through one on one transactions with fellow collector-investors.
Prices vary according to market sentiments, scarcity of the
subject matter and above-all condition. South African material
tends to fare better in the South African market, American in the
US market and so on. Consequently good bargains can be had on
both sides depending on the strategy one chooses. Undoubtedly, in
times of volatile currency values domestically, investment in
collectibles is a good hedge.
In conclusion, no philatelic item has a guaranteed value, however
astute purchases of high quality material that has demonstrated a
good ROI over the past twenty years can yield rewards. Be
cautious about throwing all your eggs into one basket and also
take care not spread your philatelic investment portfolio too
thinly. A handful of high quality items should be selected as
cherries.
You should start by taking the trouble to build a less valuable
collection with a little more volume than value. This exercise
will assist you in understanding the mechanics and issues around
condition and scarcity within the domestic context and also to
assist you in identifying scrupulous traders whom you can have
confidence in trading with.
Remember that ultimately this is a collectors market, not an
investors market, if you don't have a passion for these little
bits of paper you may get badly stung !