My client was so excited she could hardly speak in full sentences.
She had been sorting through her deceased step-father's belongings, and discovered a box filled with old stock certificates.
She was certain that they were valuable, and that she and her siblings would receive a big payout when they were cashed
in. I encouraged her to not get her hopes up, and set an appointment to come by the next day to have a look.
As I suspected, the certificates were a mixed lot of unassigned, specimen, and invalid documents. The executor was disappointed,
but she perked up quite a bit when I told her that, although the documents held no legal value, they might be worth something
on the collectibles market.
During the 19th and 20th Centuries manufacturing, mining, railroads, utilities, oil, and hundreds of other industries sold
stocks and bonds to fund growth. Certificates were issued to investors to represent their investment. Virtually all North
American cities were home to multiple industries, and millions of stock shares were sold and certificates issued. Most of
these companies closed or went bankrupt and, when they did, stockholders kept their certificates. Once deemed to be "not
worth the paper they were printed on", antique stock and bond certificates have become in-demand items with collectors vigorously
trading in them. Interest in this hobby (deemed "scripophily", pronounced "scrip-o-filly") is expanding.
The market for stock certificates is immature; there is much room left for growth. Both supply and demand within this niche
are expected to increase over the next decade. Typically, an increase in supply leads to lower prices, but that won't be
the case with this collectible for two reasons:
- Collectors tend to specialize in particular industries and geographic locations, segmenting the supply and keeping
prices high for in-demand items.
- In 2001, the New York Stock Exchange stopped requiring that physical stock certificates be issued to investors. Consequently,
few large companies issue them anymore. The supply of antique and vintage certificates is limited to the current supply
(many of them yet to be found).
A quick check of eBay presents 19,610 current auctions for "stock certificates" with 10,189 auctions completing within the
past 90 days and 4,032 of those auctions ending in sales. Of these, the high sale price was $1,395USD for a 1917 Thomas-Edison-signed
stock certificate from the Wisconsin Cabinet and Panel Company (manufacturer of phonograph cabinets). Nearly 200 certificates
sold for over $100USD, with about 600 selling for between $20USD and $100USD. In March of 2016, a John D. Rockefeller-signed
Standard Oil stock certificate sold for $30,000. Clearly these items are worth more than the paper they are printed on.
When antique stock certificates are encountered, how can one determine their value? Begin with an examination of the certificate
itself. In order to have legal value, the following conditions must be met:
- The issuing corporation still exists
- The document is not a sample or specimen
- The stock has not been sold or transferred (the document will have been stamped "cancelled" if it was)
- The name of the original owner is listed
- The current holder can prove through a chain of ownership (personal wills, usually) that they now own the stock
When no legal value exists, a certificate may have value in the collectibles market. In addition to the "supply of" and
"demand for" a particular type of certificate, the usual value markers apply: condition, rarity, authenticity, and provenance.
Other value factors include:
- Artistic rendering: Certificates by American Banknote, Franklin Lee Banknote, and International Banknote display beautifully
rendered Art Nouveau vignettes. Color, paper quality, and borders all contribute to a certificate's artistic value
- Autographs: Certificates signed by Edison, Rockefeller, Disney, or other famous person greatly enhance worth
- Historical importance: Certificates representing an interest in seminal industries such as mining, railroads, steel,
and oil are desirable, as are bonds issued by the Confederate States of America or other political entity
- Age: Other factors being equal, older certificates generally sell for more money
Where can those interested in scripophily find collectible stock certificates? Common sources include the following; each
source has it's "pros and cons".
- Local advertising: running a weekly classified ad that reads "Antique stock certificates wanted, top dollar paid" in
a local periodical or free online classifieds will bring results, especially if you live in what once was an industrial
city. Of course, what constitutes "top dollar" is up to you.
- eBay: The key to using eBay effectively is to locate "bargain" items. There are so many auctions on eBay that a little digging
can turn up some real gems. The way to proceed is to vary the search terms; some sellers use the term "stock certificates"
in their headline; others use "stocks and bonds"; still others use "scripophily". Searching current eBay auctions using
these terms returned 16 results for scripophily, 248 for stocks bonds, 204 for antique stock certificates, and 19,610 for
stock certificates. Sellers are often careless with their headlines, and buyers are often not very thorough in their searches;
these failures benefit collectors. Also, searching the online eBay tool Watchcount (watchcount.com) will return a list of
auctions which have no bids that are ending soon. A Watchcount search for "stock certificates" returned 14 auctions with
no bids, and a search for "stocks bonds" returned 90 auctions with no bids. Some of the "no bid" results fit into my personal
collecting requirements, at bargain prices.
- Estate sales: Estate sale operators (including auctioneers) seldom spend much time sorting through ephemera. They might
give a perfunctory glance at magazines and papers, and then put everything in an out-of-the-way box. Some of my most profitable
purchases at estate sales have been found amongst the overlooked ephemera, rather than in the art and furniture.
- Collectors’ websites: Serious collectors may trade on websites such as scripophily.com, bullmarketgifts.com, oldstocks.com,
or other sites. Of course, one can expect to pay top dollar for anything listed for sale on these websites; collectors know
the value of their goods and aren't likely to offer bargain prices.
Because scripophily is a relatively new hobby, competition for certificates is relatively low; in fact, most folks have never
heard the term "scripophily". There are still treasures to be found, and great collections to be built.