Stamp Investment Tip: Macao 1934 Allegory (Scott #268-88)

  In 1934, the Portuguese issued a set of definitives for Macao, featuring an allegory of "Portugal and Vasco de Gama's flagship, the "San Gabriel" (Scott # 268-88). While quantities issued information is unavailable for this set, I would estimate that 20,000 or fewer sets were issued, and Scott '13  prices the unused set at $925.40 .

Most of the sets were probably used as postage and discarded. I recommend purchase of it in F-VF or better, NH or LH condition.

In my opinion, all of the better stamps of the European and other foreign Colonies/Possessions in China should be considered for investment, as they have dual markets both in their former home countries and in China.

In 1999, Macao became a special administrative district of the People's Republic of China. With a population of about 500,000, Macao's economy is dependent upon tourism, much of it geared toward gambling, although important secondary sectors include apparel manufacturing and financial services. Annual GDP growth has been high, averaging over 9% over the last 7 years. The fact that much of Macao's economic growth has been driven by a regional monopoly on gaming is a little worrisome, because obviously there is no guarantee that the People's Republic won't relax restrictions on gambling in the rest of China, allowing more competition. Nevertheless, I feel that certain scarce issues of this former colony are grossly undervalued, given the number of collectors who will be bidding for them.

Those interested in becoming part of an international community of stamp collectors, dealers, and investors are welcome to join the "Stampselectors" group at Facebook. The group hosts lively discussions concerning stamp investment and practical aspects of collecting, and is also an excellent venue for those who wish to buy, sell, or trade stamps.

Stamp Investment Tip: Armenia 1992 Independence Souvenir Sheet Scott #431)

In 1992, Armenia issued a set and souvenir sheet celebrating its independence (Scott #430, 431). The set was issued as a strip of three stamps (Scott #430a-c). 100,000 strips and 20,000 souvenir sheets were issued, and Scott' 13 prices them unused  at $4.25 and $ 50.00, respectively.

I recommend purchase of both the strip and the souvenir sheet. These stamps were the first issued by Armenia as an independent nation in 70 years - since the Soviet takeover in 1922 - and they appeal deeply to Armenian nationalist sentiment.

Many of the new and newly resurrected nations of Central Asia and Europe have issued quite a few stamps and souvenir sheets in very modest quantities, and some of these represent interesting opportunities for speculation for those who wish to "get in on the ground floor." As these countries have only recently begun issuing stamps, their collector populations are minimal, although they are unlikely to remain so, especially if the countries prosper. The best way to play them is to target popular topicals with low issuance quantities, as these will have worldwide appeal, whether interest in these countries' stamps grows significantly or not.

Armenia, a nation of about 3.2 million, has made steady economic progress in the face of a number of obstacles, including its legacy of dependence on the Soviet Union as a centrally planned economy, a catastrophic earthquake, and an unresolved conflict with Azerbaijan over the Nagorno-Karabakh region. Major economic sectors include agriculture, chemicals, electronics, machinery, and mining, and new industries, such as precious stone processing and jewellery making, information and communication technology, and even tourism are beginning to develop. The economy is also bolstered by investment and support from 5.7 million Armenians living abroad. Annual GDP growth has averaged just under 3% over the last 5 years, although this reflect a contraction of 14% in 2009 due to the global financial crisis.

Those interested in learning more about investing in stamps are encouraged to read the Philatelic Investment Guide ($5), available on Kindle, and accessible from any computer. 

Stamp Investment Tip: Peru 1957 Peruvian Postage Stamp Centenary (Scott # C131-40)#t #C131-40)

  In 1957, Peru issued a colorful set of ten stamps celebrating the centenary of its first postage stamps (Scott #C131-40). 50,000 sets were issued, and Scott '13 prices the unused set at $ 10.25.

  The set should do well as Peru's stamp collecting population develops, and it also has appeal as a Stamp-on-Stamp Topical issue.

 
With a population of 29 million, Peru is an emerging market nation which has experienced significant economic growth over the last 15 years, and annual GDP growth averaging 7.2% over the last 5. Major exports include copper, gold, zinc, textiles, and fish meal. In 2010 Peru's per capita income is about $10,000. Poverty has steadily decreased since 2004, when nearly half the country's population was under the poverty line, although great inequities in income distribution persist. As the trend continues and more Peruvians join the middle class, the country's better stamps should do very well.

I have begun a new blog, "The Stamp Specialist", which features wholesale buy prices for stamps which I am interested in purchasing. I've posted a buy list for the Peru, and it includes the set recommended in this article. Viewing dealers' buy lists every now and then is an excellent way to keep current on the vagaries of the stamp market.

General Commentary: Comparing the Long-term Performance of First Issues

   I recently purchased a 1940 Scott Catalogue in order to make general comparisons between the the market values of various stamps then and now, and to gauge their  relative long-term performance.

       Some collectors feel  nostalgia for the so-called Classic
Period of Philately, the first century of postage stamps, during which all of the world's issues could be listed and described in a single convenient volume, rather than the unwieldy six volume set that collectors must use today. Issuance policies of that period were far more conservative than now, designs were usually dignified and attractive, and the subjects tended to be significant and relevant to the issuing country's history or culture. The idea of issuing a "Love" stamp or a stamp honoring a cartoon character would have been considered laughable during this period, and even the poorer nations would not have considered pandering to collectors in the wealthier ones by issuing stamps picturing contemporary pop music stars. To some extent, the decision by Scott Publishing to issue a Classic Specialized Catalogue reflects this lingering sense of nostalgia.

    The year 1940 represents a good starting point for taking an overview of the growth of the modern stamp market. Franklin Delano Roosevelt, the most famous stamp-collecting  U.S. President, was in office, and the U.S. was mobilizing for war and just beginning its economic recovery from the Great Depression.

In the interest of conciseness and consistency, I've decided to consider only the first issues of stamps from major nations in both the affluent and developing world, and to include only the catalogue values of used stamps, because these countries' first stamps in unused condition are often rare and unaffordable to most collectors. I've calculated the stamps' approximate average long-term compounded rates of return over the last 73 years (since 1940) using the Rule of 72, which works well when measuring exponential growth over long periods of time. In cases where a currently existing nation did not exist in 1940 but stamps were issued by a colonial power, I have listed the first stamps issued for the colony. Though somewhat "Americentric", I've utilized the old Scott country order (U.S., Great Britain and Commonwealth, General Foreign A-Z) to list the stamps.

- United States 1847 5c Franklin/10c Washington (Scott #1-2); Scott 1940 = $ 41.50, Scott 2013= $ 1,575.- ; Approximate Long-term Annual Compounded  Rate of Return (ALTACROR) = 5%;

- Great Britain 1840 1p Black (Scott #1); Scott '40= $2.00; Scott '13= $300.- ; ALTACROR = 7%;

- Australia 1913 Kangaroo (Scott #1-15); Scott '40= $ 37.18; Scott '13= $ 645.75 ; ALTACROR = 4%;

- Canada 1851 3p Red (Scott #1); Scott '40= $ 15.00; Scott '13= $ 1,000.-  ; ALTACROR =  6%;

- Cape of Good Hope  1853 Hope Seated (Scott #1-2); Scott '40 = $ 18.00; Scott '13= $ 445.- ; ALTACROR =  4.5%;

- India 1854 Victoria (Scott #2-6); Scott '40 =$ 26.75; Scott '13 =$ 610.- ; ALTACROR= 4.5%;

- Lagos 1874-75 Victoria (Scott #1-6); Scott '40 =$ 32.00; Scott '13= $  260.-  ; ALTACROR = 3%;

- Brazil 1843 Bull's Eyes (Scott #1-3); Scott '40= $ 77.50; Scott '13 = $  2,250.- ; ALTACROR = 5%;

- China 1878 Dragon (Scott #1-3); Scott '40 = $ 6.00; Scott '13 = $ 1,425.- ; ALTACROR =  8%;

- Colombia 1859 Arms (Scott # 1-7); Scott '40 = $ 25.50; Scott '13 =$ 595.- ; ALTACROR = 4.5%;

- Egypt 1866 Surcharge (Scott #1-7); Scott '40 = $  61.25; Scott '13 = $725.50 ; ALTACROR = 3.5%;

- Ethiopia 1895 Menelik II (Scott #1-7); Scott '40 = $ 1.80; Scott '13 = $ 14.- ; ALTACROR =  3%;

- France 1849-59 Ceres (Scott #1-3, 6-7, 9); Scott '40 = $ 35.35; Scott '13 = $ 2,610.- ; ALTACROR =   6%;

- Germany 1872 Small Shield (Scott #1-11); Scott '40 = $ 21.65; Scott '13 = $  951.- ; ALTACROR = 5%;

- Indochina 1889 Surcharge (Scott #1-2); Scott '40 = $ 2.85; Scott '13 = $ 107.- ; ALTACROR =  5%;

- Iran 1875 Arms ( first postally cancelled issue - Scott #11-14); Scott '40 = $ 30.00; Scott '13 = $ 280.- ; ALTACROR =  3%; 

- Italy 1862 Victor Emmanuel II (Scott #17-21); Scott '40 = $ 23.50; Scott '13 = $ 3,000.- ; ALTACROR = 7 %;

- Japan 1871 Dragons (Scott #1-4); Scott '40 = $  28.50; Scott '13 = $ 1,625.- ; ALTACROR =5.5%; 

- Korea 1895 Yin Yang (first stamps to be used- Scott #6-9); Scott '40= $ 1.65; Scott '13 = $ 80.- ; ALTACROR =  5%;

-  Mexico 1856 Miguel Hidalgo y Costilla (Scott #1-5) ; Scott '40 = $ 26.25; Scott '13 = $ 358.50 ; ALTACROR = 3.5 %;

- Netherlands 1852 William III (Scott #1-3) ; Scott '40 = $ 8.35; Scott '13 = $ 181.50 ; ALTACROR= 4%;

- Netherlands Indies 1854 William III (Scott #1); Scott '40 = $ 6.50; Scott '13 = $ 100.-; ALTACROR = 4%;

- Philippines (Spanish) 1854 Isabella II (Scott #1-5); Scott '40 = $ 205.00; Scott '13 = $ 1,100.- ; ALTACROR=   2.25%; 

- Poland 1860 Arms (Scott #1); Scott '40 = $ 8.00; Scott '13 = $ 250.- ; ALTACROR = 4.75 %;

- Russia 1857 Arms (Scott #1); Scott '40 = $ 25.00; Scott '13 = $ 850.- ; ALTACROR =  5 %;

- Spain 1850 Isabella II (Scott #1-5); Scott '40 = $ 187.50; Scott '13 = $ 3,367.- ; ALTACROR =  4%;

- Sweden 1855 Arms (Scott #1-5); Scott '40 = $ 151.00; Scott '13 = $ 9,400.- ; ALTACROR = 6%;

- Thailand 1883 Chulalongkorn I (Scott #1-6); Scott '40 = $ 2.60; Scott '13 = $135.50; ALTACROR=  5.5%;

   These rates average out to about 4.75%, which significantly beats the very long-term U.S. inflation rate since 1872 of 2.16%,  but is less impressive when compared to the 3.9% inflation rate since 1945.

   The performance of Great Britain's Penny Black is particularly interesting, because it is the world's first postage stamp and probably also the world's most famous stamp, and is therefore in demand by many stamp collectors worldwide.  About 69 million were issued in 1840, very few were collected unused, and a substantial number of used examples (perhaps 1-3 million?) remain, though most are in poor to average condition. It is possible to make an educated guess concerning its price performance since 1840 by assuming a "hypothetical 1840 catalogue value" of 1/2 cent to 1c for the stamp in used condition (as there were no stamp catalogues in 1840), which would imply an increase by a factor of 30,000 to 60,000, and a 173 year compound annual  rate of appreciation of 6% or 7%, depending upon which catalogue value is used.  If the relatively consistent general worldwide demand for the Penny Black could  be segregated from the more dynamic and particular demand of collectors of Great Britain, British Commonwealth, and philatelic investors, then it might be possible to gauge the long-term global growth of the stamp collecting population, but this, alas, is impossible.

Stamp Investment Tip: U.S. 1869-75 90c Lincoln (Scott #122, 132)

   In 1869, the U.S. issued a grilled pictorial set of stamps which many collectors consider its first commemoratives (Scott #112-22). These were reissued without grill in 1875 (Scott #123-32). In both sets, the top value is a 90c stamp (Scott #122, 132), portraying Abraham Lincoln, America's greatest president. While printing quantities are not known for the first stamp, I would estimate that a few thousand were issued. 1,356 of the reissued 90c were issued.  For unused, these stamps catalog $ 12,000.- ($2,100.-  for used), and $ 3,750.- ($ 6,500.- for used), respectively.

   Ninety cents was a lot of money in the 1870s - about 2 days wages - when the average American worker earned about $120 a year.  Only a few wealthy collectors could afford to collect the stamp unused, and it is likely that many of the rest were used as postage on heavy packages and were then discarded.

   Given these stamps' priciness, I consider purchasing them as seconds of  F-VF or better appearance to be the most prudent way to invest in them, assuming that these may be had for 10%-15% of catalog value.  Centering is typically atrocious on these issues, so select for those with perfs clearing the design on all four sides. Note that when purchasing seconds of expensive stamps, appearance and the lack of the worst types of defects is very important. Avoid stamps with pieces missing, stains, tears, ugly, obstructive cancels, etc.. Though it may seem counter-intuitive, nice-appearing seconds of very expensive stamps are often better investments than sound examples, as discussed in a previous article ( Practical Advice - When Do Seconds Come In First? ).

Those interested in becoming part of an international community of stamp collectors, dealers, and investors are welcome to join the "Stampselectors" group at Facebook. The group hosts lively discussions concerning stamp investment and practical aspects of collecting, and is also an excellent venue for those who wish to buy, sell, or trade stamps.

Stamp Investment Tip: Lebanon 1937 Paris International Exposition (Scott #C57-64)

In 1937, Lebanon issued a set of eight airmail stamps honoring its participation in the Paris International Exposition (Scott #C57-64). 15,000 sets were issued, and Scott '13 prices the unused set at $44.50.

The issue has dual market appeal among collectors of  Lebanon and French Colonies/Possessions.

Lebanon, a nation of 4.2 million people, is noted for its commercial enterprise. Over the course of time, emigration has yielded Lebanese "commercial networks" throughout the world. As a result, remittances from Lebanese abroad to family members within the country total $8.2 billion and account for one fifth of the country's economy. The country has the largest proportion of skilled labor among Arab States. The tourism and banking sectors are the the most important pillars of the Lebanese economy, though they have at times been disrupted by political instability. Annual GDP growth has averaged about 4.8% over the last 5 years.

Those interested in learning more about investing in stamps are encouraged to read the Philatelic Investment Guide ($5), available on Kindle, and accessible from any computer.

Stamp Investment Tip: Costa Rica 1960 Saints Vincent and Louisa (Scott #C298-302)

In 1960, Costa Rica issued a set of five airmail stamps honoring Saint Vincent and St. Louisa (Scott #C298-302). 20,000 were issued, and Scott '13 prices the unused set at $3.25.

Aside from being yet another grossly undervalued Latin American issue, the set doubles as a Religion Topical.

A small nation of 4 1/2 million people, Costa Rica is unique as the only Latin American country to have escaped the plague of repressive dictatorships and oligarchies endemic to the region. Costa Rica has generally enjoyed greater peace and more consistent political stability than many of its fellow Latin American nations. The government offers generous tax exemptions to those investing in the country,and in recent times electronics, pharmaceuticals, financial outsourcing, software development, and ecotourism have become the prime industries in Costa Rica's economy. High levels of education among its residents make the country an attractive investing location. Annual GDP growth has averaged 5.6% over the last 5 years.


I have begun a new blog, "The Stamp Specialist", which will feature my buy prices for stamps which I am interested in purchasing. I've posted a buy list for Costa Rica, which includes several sets recommended in this blog. Viewing dealers' buy lists every now and then is an excellent way to keep current on the vagaries of the stamp market.

Stamp Investment Tip: Portugal 1928 Third Independence Issue (Scott #437-52)

  In 1928, Portugal issued its third set of stamps celebrating 800 years of independence (Scott #437-52). 50,000 sets were issued, and Scott '13 prices the unused set at $99.00 ($150.- for NH).

All three of the Independence sets are worth considering as investments, as they illustrate the panoply of Portugese history and also appeal to topicalists collecting Famous Persons. They represent a conservative bet on  Portugal's eventual recovery from the European financial crisis.

  
A nation of 10.6 million people, Portugal is a high income mixed economy, and its major industries include agriculture, fishing, mining, tourism, automobile production , electronics, textiles, and chemicals. The Financial Crisis of 2008 is still affecting the Portuguese economy severely, causing a wide range of domestic problems specifically related to the levels of public deficit in the economy, as well as the excessive debt levels. Portugal's average annual GDP growth over the past 5 years has been flat, reflecting economic contractions in 2009 (2.9%) and 2011 (1.6%).

Those interested in becoming part of an international community of stamp collectors, dealers, and investors are welcome to join the "Stampselectors" group at Facebook. The group hosts lively discussions concerning stamp investment and practical aspects of collecting, and is also an excellent venue for those who wish to buy, sell, or trade stamps.