Stamp Collecting for Profit

To some stamp collectors, suggesting the use of stamps as an investment is highly controversial. For many popular stores and dealers, telling them that you want to purchase stamps as an investment is a mistake. They often will tell you that stamps are not an investment, and refuse to provide any literature as to how to make money selling stamp collection or dealing in stamps. This response is fairly typical, as stamp dealers only deal in stamps and are legally precluded from giving anything that might represent investment advice.

stamp-collecting-profitBy and large, most people get into stamp collecting because they enjoy stamps. These little pieces of artwork that affix neatly to postcards and envelopes can tell many stories about where they have been, the history of their countries of origin, and can provide enjoyment to those who simply appreciate their lovely designs.

That said, the thought often crosses a stamp collector’s mind that the collection might be worth something someday. Few collectors who set out collecting as a hobby end up with a collection worth much more than what they paid. However, if you begin your collection with an eye toward investment, it is possible to gain some financial value from your hobby as well. You want to pay close attention to a stamps value, which involves looking at many factors before you buy. Only by getting a good deal on high quality stamps can you hope to earn a profit when selling stamp collection.

The key word in stamp collecting for profit is “condition.” Pristine stamps earn top dollar. You should always seek to get a stamp in the best condition available. Here are some factors to consider:

  • Centering of design. Turn the stamp upside down and look at the edges. Is the design centered on the stamp? A well-centered design is more valuable.
  • Examine the gum. The more intact the gum on the back of the stamp, the higher the value. Note that there are some gum replacements, but mint condition gum is far more valuable.
  • Look at the perforations. Are they intact or at least cleanly cut? Jagged edges will reduce value.
  • Note cancellation marks. Cancellation marks can reduce a stamp’s value. Look for stamps that have light marks, or no marks. You do not want marks that interfere at all with the stamp’s design.

After examining condition, you should then investigate your potential stamp. Where does it come from? How rare is it? Is there a demand in the market for this particular stamp? Keep in mind that demand will fluctuate and is often a matter of timing and luck. Sometimes, a rare stamp is being highly sought after by several different collectors. Other times, the number of rare stamps exceeds the number of collectors who want them. This can make stamp collecting rather volatile and you should be aware of this before approaching collecting as an investment.

Stamp collecting is a worthwhile hobby regardless of how you approach it. If you are careful and meticulous, you may end up with a valuable asset when the time comes for selling stamp collection.