Investing in guns; good or bad?

SW_shooter

SW_shooter

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Well before the current gun buying frenzy I was pondering the idea of taking some IRA monies and usinng them to invest in some pistols. The money is in an interst only account and over the past year or two hasn't grown much if anything. So I am looking for some opinions:

* buy guns as an investment?

* what gun to buy and why?

* how much to invest?

I realize that they would be LONG term investments (ie may take years to appreciate significantly). I'm willing to go that route as I have a good amount of time before retiring. One of my concerns is the current climate of guns and the yet to develop gun control laws that may come to life. Is it too risky to put money into guns? :cool:

Your thoughts and opinions appreciated as always.
 
No investment has yielded the returns of quality firearms as of late. With the buying frenzy, the returns on certain items have been astronomical. Quality firearms will continue to appreciate; panic buyers aren't necessarily looking for what S&W enthusiasts consider good investments, so short term investing in firearms will go a different direction than long term. Here's an example ... Two years ago I spent $1,000 on a stock Bushmaster M4 carbine. Excellent AR, built before the move to Ilion, NY, and fired only 50 rounds. I sold it last week for $2,500. That's a 150% return on investment. Fluke? Maybe, but what other investment device would have brought that $? Stocks? Mutuals? CDs? Bank accounts? Firearms and precious metals are excellent investments, as far as I'm concerned.
 
Do not confuse investing with speculating. Stay away from the ARs and high cap pistols and buy good solid investments. I mean guns that are in the top 1-2% of condition. When times are good it tends to raise the price of everything. While a 60% pre 64 Model 94 may bring a good price now if times go bad it'll go down in value more than a 98% gun.

Some wise person said "Buy when everyone is selling, and sell when everyone is buying."

Years ago with coins and guns you had few options when it came time to sell. If you sold at shows it took a long time to get top prices out of everything. Now with eBay, Gunbroker, and Armslist you can get the stuff in front of a lot of folks quickly.
 
Just think of all the gun only stores that have gone out of business around the past 10 years. You either have to do high volume or do other things like CC classes or indoor shooting ranges. Most of the time I would like to break even when selling a gun. I just buy them because I like them. If I died and my wife had to sell them she would more than likely loose money on even the guns that I bought a long time ago. Don
 
Gun collecting is kind of like coin collecting in that the devil is in the details and condition is , indeed, everything.

The more there is to be gained, the smaller the market you're playing to is. With all due respect, the current black rifle madness is a fluke that many predicted, saw coming, etc. and no doubt a few enterprising individuals may have been buying up a few just waiting for it to happen, but for the most part the market was already flooded for those interested in owning one when there was no panic on. Those who jumped immediately and went out and bought two or twenty when the signs first presented themselves are more typical of that kind of "investing". Hindsight is 20/20 but the day before the latest silliness began I'm betting NO ONE was sitting on a stockpile of a million dollars worth of AR's saying , "any day now I'll be rich !"

Long term appreciation depends on a lot of factors and it can be as fickle as a hot competition in vogue at the moment, a popular movie (ever hear of "Dirty Harry"?) or it can be be 'blue chip' stuff that, like utility company stocks, don't make big profits but offer steady growth.

All that to say just like playing stocks - you either have to have some knowledge of the product/subject or put your trust in someone to know it for you.

I personally find S&W revolvers to be worthy (that's why I'm here and not on the Taurus forum) but even that can be broken down into multiple tiers depending on your target market and personal interests. No real "take it to the bank" "pat" answers.
 
New or well maintained guns never go down in value. If available keep the original box - collectors like to have both and the box increases the value.
 
SW_shooter said:
* what gun to buy and why?
Click to expand...

That's the magic question. I started my collection of USGI M1 carbines because I liked them, their history, and when they were relatively affordable. I was fortunate as the guns I have been so fond of have increased in value at a phenominal rate. When I started my collection I figured I'd be lucky if I ever got my money back and I was okay with that.

38952848.jpg
 
As a hedge against inflation I think it's not a bad idea to own any modern firearm. As the value of the green paper continues to erode, durable goods will always hold value. If you really want to speculate look for confederate weapons but you really need to know what you are doing. Or maybe some nice old peacemakers nicely engraved or owned by some well known personality.
 
As with anything i would think the Rare/ultra-rare and top condition
examples of guns would make for wise investment opportunities.
Other types will peak and drop with current situations, ie
(this current madness). Look at what Rare coins continue to do.
Paintings, Antiques etc...
If one wants to use guns to "invest" i would look for NIB older,
hard to find examples and i would'nt lose any sleep over losing
my money.

Chuck
 
For any investment to work there has to be a market. As long as we can continue to sell to each other, as we have done privately over the years, I'd say guns have great potential as investments. If the government determines that private sales are illegal then I believe that the investment potential will be diminished. How much it is diminished depends on how onerous the task of transferring ownership becomes. Just my opinion.

Out
West
 
The trick to investing is to buy low - sell high.

I think it's way to late to buy low.

Todays high prices are strictly caused by the secondary market and individual hoarding and short term greed. Wholesale prices have not really gone up. It's all temporary , providing no legislation passes. Prices will drop as soon as the panic dies.

When BO was on the verge of being elected the first time , sales and prices of rifles and bare AR lowers went thru the roof. Prices went to over $300 for stripped lowers. No legislation or bans were passed and prices eventually dropped back to around $50-75 and all ya wanted were available. People were crying as they tried to sell the ARs they paid $2000 or more for , when brand new ones were $750.

In the slim chance that they become "NO MORE" , or at worst untransferrable , buying them now for $350-500 in hopes they go to 1000 is foolhardy.
 
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future firearm legislation can be a potential problem, in canada handguns with prohibited status can only be traded among other grandfathered owners . this makes a "prohibited" 4" mod 29 worth about 450 and a comparable "restricted" 6" worth about 800 because it is available to a wider range of buyers.
 
Old and out of production smiths,colts and Winchesters in the best condition you can afford is a good place to start.
 
Out West said:
For any investment to work there has to be a market. As long as we can continue to sell to each other, as we have done privately over the years, I'd say guns have great potential as investments. If the government determines that private sales are illegal then I believe that the investment potential will be diminished. How much it is diminished depends on how onerous the task of transferring ownership becomes. Just my opinion.

Out
West
Click to expand...

This is spot on. If you have something that's worth a lot, but you are unable to realize the value, it's really not worth a lot then is it? The current government does not like free enterprise. Actually they don't like anything that has "free" in front of it....unless we're talking about giving away our hard earned tax dollars....
 
buy guns that people want. not what you like unless you want it for yourself. buy at good prices. example, i walked into a gun shop last year and someone had just traded a 686 no dash 4" revolver. had everything that came from the factor. box cleaning kit ect....gun looked brand new. i paid 425 for it. dont rush, the deals come. another one was a local gun shop 2 years ago was selling brand new sig 238's on sale for 419....i grabbed 2 of them. i since sold them at a very nice profit. just know what people want
 
As above be very carful. Spend a lot of time learning everything you can about whichever firearm you think you want to collect. Quite a few counterfeits in the lever action rifle and single action pistol market. My advice is only collect the very upper end. If you are just speculating and not interested in learning about the gun....just buy gold or silver. Good luck.
 
Out West said:
For any investment to work there has to be a market. As long as we can continue to sell to each other, as we have done privately over the years, I'd say guns have great potential as investments. If the government determines that private sales are illegal then I believe that the investment potential will be diminished. How much it is diminished depends on how onerous the task of transferring ownership becomes. Just my opinion.

Out
West
Click to expand...

Good sound advise here - and although it's just his opinion, it's dead on.


Pete
 
I own several old Smith and Wesson revolvers, mostly because I like them, but in part because I think they're undervalued in price relative to their high quality and desirability. As others have said, it depends on condition and (per the current craziness) current trends.

Since revolvers aren't likely to be banned anytime soon, they aren't nearly as volatile as semi-autos. In the last few weeks, I've seen the new, common and lower end S&W semi-auto pistols I have increase in value more than old vintage S&W revolvers. Still, all guns are likely to go up. I haven't seen our paper investments do anything in the last year, however.
 
Out West said:
For any investment to work there has to be a market. As long as we can continue to sell to each other, as we have done privately over the years, I'd say guns have great potential as investments. If the government determines that private sales are illegal then I believe that the investment potential will be diminished. How much it is diminished depends on how onerous the task of transferring ownership becomes. Just my opinion.

Out
West
Click to expand...

This makes the most sense.

And yes, many of the factors mentioned come into play.

What to buy? How will you know when it's time to sell and what will the demand be?

Timing is everything but extremely hard to predict when it comes to guns.

An example: A friend that owns a pawn shop has several Colt SAA revolvers. All made before 1900 and in very good condition or better. He is just sitting on them waiting for the market to get better. He has a lot of money invested in them and will make a big profit WHEN the demand is back. He also has several Winchester rifles in waiting.

Investing in anything can be risky. Knowing when to buy and sell is tricky. When you invest you don't just want your money back. You want to make a profit. The more profit the better. Otherwise just go to the bank and buy some CD's.

In my mind and assuming I could afford to invest, I would buy vintage NIB or near new.

I collect coins and have an extensive collection of certain coins. They are not an investment but I can at least get my money back. If I were to invest I would only buy desirable coins that were professionally graded.
 
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