Rant: Firearms are not an investment.

Of all the things guns are, I am sick of hearing that firearms are an investment.  They are not.

While many guns will hold their value, and some do appreciate in value, they are not an investment.

The classic argument I commonly see and get told is that if  you bought a M16 in 1986 for $1000, it would be worth about $20,000 today.

I point out if you bought $1000 worth of Apple stocks, you would have about three million as of when I am writing this article.  Now that is an investment.

Last person I pointed that out to said, “But you have no idea Apple was going to do well, a gun is a gun.”  Or something like that.

Had you just put that $1000 in the equivalent of a S&P500 index fund with dividends reinvested you would have around a million after inflation.

Well, what if  you had bought a Mini-14?  I’m told you could get a Mini-14 for about $400 back in the 80s.  That is about $900 now counting for inflation.  Walmart was clearing out Mini-14s for $400 this past month.  Used Mini-14s can be found for sale in my area for $450.

So, had you invested in a Mini-14 you would have lost money.  You might have had a better profit margin had you invested in a Tec-9.

 

The best thing about guns is that they are an assets you can use (as long as you maintain them, and can feed them).  If you don’t have ammo your gun is a really awkward club.  If you don’t maintain it, it will degrade into worthlessness.

Look at cars, a 2004 Toyota Corolla is not likely to become a classic collectible anytime soon or ever.  Similar with your average firearm.  Some will, as there are plenty of classic cars people like.  But the market changes.  I hear how the muscle cars from the 50s and 60s that were very valuable a decade or two ago, are not selling well now since we have a new generation of car collectors that only care about the muscle cars from their youth.

So, if you had a massive collection of vintage pinfires you might have a much harder time turning around and selling them for a profit.  Or even look at revolvers and bolt action .22 rifles.  The resale market for those have tanked.

Your firearms are assets.  When you use them they depreciate in value and if you don’t take care of them they will become valueless.

6 thoughts on “Rant: Firearms are not an investment.

  1. Some firearms are investments.

    None of the firearms discussed here at looserounds are investments. They’re all commodity guns.

    Most people who make this rant have never even held firearms that are investments. They either can’t afford them, or will never buy them even if they could, because they’re not “cool” enough. Most people cannot even appreciate the level of workmanship in a high end gun, regardless of the age of the gun. I see this all the time – people ranting that there’s no point in blued steel, high quality walnut in stock wood, etc. OK – but they shouldn’t pretend to having knowledge of what is and isn’t collectable or valuable. It’s also why I won’t work on AR’s or Glocks: The people who own such guns won’t pay for my time. The expect a gunsmith’s time to be billed at commodity rates when I’m working on a commodity gun – I see this mindset all the time.

    Commodity firearms won’t ever be investments, and that’s true of old guns, too. eg, none of the wire-twist barrel “farmer shotguns” from the late 19th century are collectable, but a Damascus barrel, high-grade LC Smith or Parker from that era certainly is. It isn’t the age of the gun that makes it valuable – it is the quality and rarity.

    Cars as an example of an investment or collectable asset? Why are we debating muscle cars, when there are obvious examples of an appreciating automobile like a Duesenberg out there? Like the guns I’ve mentioned, a Duesenberg J (eg) shares three attributes: a) it’s one of the highest quality examples of the item extant, b) there were never that many made to begin with, and c) they’re not making any more of them. Some Dueseys go for over $1 mil today.

    Guns as an investment have the same problems as rare art, rare cars and even some real estate: a liquidity risk. These sorts of assets need time to be sold and realize their value in a sale. In guns as in cars, art, coins, etc – quality, rarity and provenance rule.

    • When I hear someone call a firearm an investment, they are never talking about something like a hand crafted Drilling or a Holland & Holland. It is always something like a Taurus revolver or a PSA AR15. Rarely they will be referring to something like an HK MP5, which is really good at holding its value. But if you look at something like a MP5, it was not designed to be rebarreled each time you shoot a barrel out. The intent with such a gun was to be replaced when an agency wore one out.
      The people that buy collectible cars are not the people scrounging their money together so that they can retire off selling that one car.
      I suppose the major point of my rant is seeing people delude them selves that their cheap guns can instantly be turned around for their full value. As you said “liquidity risk”. I’ve seen too many cases where a gun owner dies and their surviving spouse liquidates a collector for pennies on the dollar.

    • if you have the impression that looseorunds has never had articles on investment grade guns, you may have missed a lot of stuff from our first few years.

  2. To me firearms are a investment in tools,as are all me carpentry tools/bows/fishing and campoing gear ect.

    This is a investment in building skills,learning some basic firearm maintenance/a hunting tool/if needed a self defense tool,so,all in all,a great investment,and of course,just fun.

    I appreciate the work that goes in say engraved Purdy shotguns but would never want to bring into the field so damn nice.I once built a 4×4 frame up,really spent a lot of time and money,refused to drive during winter due to salted roads and got to a point didn’t even want it in the woods and trails,was too nice,hence,sold it.Would be the same with a investment grade firearm for me.

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