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Auction strategies for low-ball bids


kirispupis
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Hello everyone,

There's an auction with several coins I'm interested in. The following applies to all of them.

  • They've been on my radar for some time. Each has been on my list for over a year.
  • None are particularly rare. If I don't win any at this auction, I'll have other opportunities.
  • Prices are variable. I've seen them go through the sky at some auctions, while at others they've gone IMHO low.

My thinking is to place fair-but-on-the-low-side bids. Where I'm debating is the timing. My general strategy for rare coins or coins where I expect a lot of competition is to bid live. In this case, I don't really want to get into that passion because I know I'll be driven to higher bids.

Bid now
    Advantages: Forces someone who values the coin similar to I to go one payment level higher. Other lowball bidders won't become attached to the coin, because their bid will immediately lose.
    Disadvantages: May drive unnecessary attention to the coin. I know when I see bids early in the auction I pay attention. Is there something about the coin I missed? Gives other parties ample time to decide to outbid me.

Bid just before the auction
    
Advantages: I can see which coins are going over my orbit and avoid them. Also, at this point lots of coins are receiving bids, so mine will be mostly unnoticed.
   Disadvantages: I'll likely be outbidding someone. That person's been the high bid for some time, and will be motivated to outbid me. I also may be pushed to go up a bid level.

Which would you do?

Edited by kirispupis
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Generally my strategy when low-balling is if I'm very price conscious on the bid increment to bid the max when the coin is nearing that exact increment. If that's opening I'm happy to just place the bid down early, and if someone else outbids me to remove the lot from what I am watching. I think sometimes people see no bids as well which can  encourage interest in getting a deal, and the pre-bid can help discourage that.

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I don't think trying to influence other people works. What scares off one person encourages another to bid a lot higher to scare you off. Even with no bids, good coins that seem to be unnoticed usually aren't. It's true that if someone bids early they'll be more attached to a coin, but that applies to you too.

If you're happy to win or lose all the coins at the prices you have in mind and won't revise them, you might as well bid now. If someone pays more, they probably would have regardless, since your bids are modest and unlikely to be beyond their expectations. I don't think a bid of even double the estimate would draw special attention to a coin, given how low estimates are.

If you're likely to revise your bids, you should bid later. You won't be tempted to respond to other bids and you can see what the other pre-bids are. You could then place stronger bids on fewer coins, or one coin, which you'd then be more likely to win.

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Most of the time I am bidding at live auctions. Nothing beats getting up at 4 AM get a quick breakfast with a big infusion of fizzy flavored sugar water spend a lot of time, only to get nada. However I do E auctions. Generally speaking I wait until close to the end. I tend to bid my maximum about a minute or so before as I have been a victim  of "wonky computer service " However as I usually look at the auction a few hours ahead of time,  if I see that the current price is very close to my maximum I will bid right away. This procedure only applies to those auctions in which the lots have a fixed finish time. Some e auctions have a "soft" end time. In these auctions if the bidding continues until biding ends. On these I tend to only go up a couple of increments over the current bid. After that i would treat the bidding much the same as I would in a live auction. 

A coin I won at an E auction

Ae Uncia Rome 217-215 BC. Obv Helmeted head of Roma left Rv Prow of Galley Right below dot Crawford  38/6 RBW 99 14.04 grms 23 mm Photo by W Hansen38-e.jpg.a5e118ef47ca89429430ae73ed3a5f72.jpg

I really liked the style on the obverse of this coin. Purchased it at a CNG E Auction back in 2008

Edited by kapphnwn
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1 hour ago, John Conduitt said:

I don't think trying to influence other people works. What scares off one person encourages another to bid a lot higher to scare you off. Even with no bids, good coins that seem to be unnoticed usually aren't. It's true that if someone bids early they'll be more attached to a coin, but that applies to you too.

If you're happy to win or lose all the coins at the prices you have in mind and won't revise them, you might as well bid now. If someone pays more, they probably would have regardless, since your bids are modest and unlikely to be beyond their expectations. I don't think a bid of even double the estimate would draw special attention to a coin, given how low estimates are.

If you're likely to revise your bids, you should bid later. You won't be tempted to respond to other bids and you can see what the other pre-bids are. You could then place stronger bids on fewer coins, or one coin, which you'd then be more likely to win.

This makes sense. Thinking about it a bit more, here are two coins I won at lowball bids. For both, I bid the day before. The Amastris had a few bids already, while the Elis had no bids.

I've placed lowball bids early in auctions before, but I can't recall ever winning one, so maybe that answers my question. 🙂 

amastris.jpg.88276ef5e341b9c6c00232ff1f20c019.jpg

Elis.jpg.f9e13a74c0b74cdeaccb07b6e49575ec.jpg

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When I'm really interested (I mean really interested) in a coin I will bid live, or at least place a proxy bid if I can't follow the auction live

When i'm in the position of the OP (would like the coin, but not desperate about it and there are others on the market) I will put a prebid and forget it. It prevents me from entering a bidding war to finish with something I regret buying at that price

Q

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Being in Australia, most auctions end when I’m asleep, and I value my sleep! 
Often, a few hours before the auction ends, I place several bids before bedtime at prices I’m comfortable with. I don’t get sucked into emotional bidding in the final frenetic minutes before the auction ends. When I wake up the next day, I find out if I’ve won. Usually I win 1 in 10 lots that I bid on. While there’s seldom any bargains to be had, I’m able to get great coins well below vcoins prices! 

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1 hour ago, GregH said:

While there’s seldom any bargains to be had

Am I the only one:  When I won something for less than my top bid, I had to wonder why no one else wanted the thing that I thought was worth more.  Are bargains bargains?  I say it is OK to buy bargains but I suspect that those will be the coins hard for my heirs to sell at any price.  If they were easy sellers, someone would have outbid me.  

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28 minutes ago, dougsmit said:

Am I the only one:  When I won something for less than my top bid, I had to wonder why no one else wanted the thing that I thought was worth more.  Are bargains bargains?  I say it is OK to buy bargains but I suspect that those will be the coins hard for my heirs to sell at any price.  If they were easy sellers, someone would have outbid me.  

If you’re collecting outside a popular series, I’m sure you’ll find some great deals. I suspect the best way to sell these pieces is at a fixed price in a store, where they can sit for several months waiting for a specialist collector to discover them.

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There is no clear rule of success.

When I intend to buy a coin that doesn't have anything extraordinary (condition or rarity) I inform myself about a possible price, from previous auctions. Although auctions can be illogical. After I have an idea about a correct hammer price from my point of view, depending on how much I want and like the coin, I decide what would be my final bid. Usually it is in a range of 70%-130% of what I consider correct hammer price.

I only bid live in almost all the instances. I rarely put prebids or proxy bids, this only happens when I know I am not at my desk or not having my phone when the coin is live, but this rarely happens.

Especially for cheap coins, I see no reason to apply bids before the auctions, as this might make other bidders notice a coin that wouldn't be noticed otherwise.

 

My favorite situations are the ones where I get the coin live with the opening bid. A recent example

image.png.324943ae8601f4f63c151110b1bef6c1.png

This coin doesn't have anything extremely special. What made me notice it - the swan, a bird that is not very common on ancient coins. The hammer I had in mind - 20 EUR. For a moment I was tempted to apply a pre/proxy of 20 EUR but there was a chance this would have attracted other people, so why?

In the end I was the only bidder and got it for 10 EUR.

Edited by ambr0zie
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I tend to bid live at feature sales and usually bid right before closing on timed e-auctions as long as the time difference isn't too atrocious for a given sale (with the caveat that I mostly only bid on greek and roman republic stuff, if I was into Byzantine it would be a whole other story!)
 

8 hours ago, GregH said:

Being in Australia, most auctions end when I’m asleep, and I value my sleep!

Ah, a rookie mistake. (Kidding, of course!) 

While I feel the extra reflexivity and control afforded by being awake to see what's getting bids and what's selling cheaply has definitely helped, and has allowed me to win a number of coins I wouldn't have otherwise, it's not nearly enough to justify being awake at 3am if I did have to be awake at 7 for work. When the lot I want is at an especially gnarly time then I follow your strategy of bidding before bed, with a pretty similar results.

 

6 hours ago, dougsmit said:

When I won something for less than my top bid, I had to wonder why no one else wanted the thing that I thought was worth more.  Are bargains bargains?  I say it is OK to buy bargains but I suspect that those will be the coins hard for my heirs to sell at any price.  If they were easy sellers, someone would have outbid me.  

Depends on a number of factors, the biggest one being the customer base of the auction. Some auctions get small number of bidders or bidders who bid frugally, others attract wealthy buyers, and others still attract those with little knowledge of prices. The last two tend to end up with higher hammers.

Personally I try to use the past sale price of the coin I'm bidding on (if it has a sales record on acsearch) as well as a comparison to similar coins at major auctions in the past 5-10 years to determine the "market" value, and bid accordingly. In some cases a coin sells for 1/3 of what it did 5 years ago simply because it went from a feature sale at a well-regarded firm like NAC to being sold in an e-auction at a relatively unknown firm. I'd bet if you/your heirs sell the same coin at a NAC feature again you'll probably get the original NAC hammer or more, while the previous owner/his heirs just got unlucky selling at the wrong place.
Another caveat in all this is the cost/price bracket of the coin to begin with. If you buy a $3000 coin for $1000 you almost certainly have scored a bargain, if you buy a $30 coin for $10 it is possible you'll have a hard time getting $30 for it when it comes time to sell, though IMO it's still a good purchase.

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2 hours ago, FrizzyAntoine said:

I tend to bid live at feature sales and usually bid right before closing on timed e-auctions as long as the time difference isn't too atrocious for a given sale (with the caveat that I mostly only bid on greek and roman republic stuff, if I was into Byzantine it would be a whole other story!)
 

Ah, a rookie mistake. (Kidding, of course!) 

While I feel the extra reflexivity and control afforded by being awake to see what's getting bids and what's selling cheaply has definitely helped, and has allowed me to win a number of coins I wouldn't have otherwise, it's not nearly enough to justify being awake at 3am if I did have to be awake at 7 for work. When the lot I want is at an especially gnarly time then I follow your strategy of bidding before bed, with a pretty similar results.

 

Depends on a number of factors, the biggest one being the customer base of the auction. Some auctions get small number of bidders or bidders who bid frugally, others attract wealthy buyers, and others still attract those with little knowledge of prices. The last two tend to end up with higher hammers.

Personally I try to use the past sale price of the coin I'm bidding on (if it has a sales record on acsearch) as well as a comparison to similar coins at major auctions in the past 5-10 years to determine the "market" value, and bid accordingly. In some cases a coin sells for 1/3 of what it did 5 years ago simply because it went from a feature sale at a well-regarded firm like NAC to being sold in an e-auction at a relatively unknown firm. I'd bet if you/your heirs sell the same coin at a NAC feature again you'll probably get the original NAC hammer or more, while the previous owner/his heirs just got unlucky selling at the wrong place.
Another caveat in all this is the cost/price bracket of the coin to begin with. If you buy a $3000 coin for $1000 you almost certainly have scored a bargain, if you buy a $30 coin for $10 it is possible you'll have a hard time getting $30 for it when it comes time to sell, though IMO it's still a good purchase.

I would say the last paragraph is a spot on

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6 hours ago, David Atherton said:

Bid as much as you can as late as you can. Otherwise you give time for the competition to feel your bid out. If you lose, you can at least walk away knowing you gave it your best shot.

I can never understand people who place multiple bids early. 🤷‍♂️

This 100%. Bidding early allows people to test your bids and usually the hammer price will be higher than if you just wait till near the end. I’ll never start bidding more than 5 min prior to the hammer time. Especially now that some auction houses reset the timer for an extra few seconds to prevent sniping. 

Also never bid with an odd number! You’re signaling to your competitors that they've hit your max bid. 

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FWIW, I've held off on bidding so far. The main reason is, as others have already stated, I don't want to show my cards just yet. I'm also a bit conflicted on which coins I'll pursue.

There are three 'common' coins that are all high on my list. They also tend to be a bit pricy, even if I get them at a good price. I'll watch where those three trend, but I may end up bidding on several more uncommon coins for a different collection.

Note that I really don't care about resale value. If I were looking to increase the value of my collection, I'd try to obtain those three at fair prices - since they'll be easy to unload. The others, even though rarer, will be difficult. Who knows. If I persist, I may build up a pretty nice and rare collection in the next 30-40 years I hope remain for purchasing. Then, when my family puts it up for sale, it will attract specialist buyers who will bid things up. However, it doesn't really matter, because I won't care at that point. 🙂

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Haven't posted in awhile, I still sign in every day and look around but I am not buying or bidding on coins at this time.

My strategy has most always been to be tight, try never to overpay and sniping at last seconds on low priced coins. If I don't win, no big deal. There will eventually be another and sometimes they come even better and for an even lower price.

If it is a coin I really want, I do the same but bid as high as I almost intend to pay and then bid my top bid just before it ends. Sometimes, I outbid myself. It's only money. 

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