Collecting first editions – an investment between the covers!

by Will Farmer 

Ernest Hemingway once said, "There is no friend as loyal as a book."

And if you are one of the many investors who have watched your savings evaporate in the stock market over the last few years, Hemingway's quote has never been truer! There are few investments as loyal as a rare book.

Books, especially rare first editions, are a risk-free way to preserve wealth, in good times and bad. While it is a rather whimsical type of investment, there are many advantages to starting a collection of rare books including safety, growth, and the overall tactile enjoyment that you simply can't get out of stocks, bonds, or other types of investment.

And while you probably won't get rich overnight, investing in rare books can be an almost fool-proof way to hedge yourself against the volatility of the global economic system. At the end of the day, if everything else goes south, you still have a beautiful book that is holding its value.

Collecting books is more akin to a savings account than a short-term investment. Books are not liquid like stocks; if you needed to pull money together in a pinch, your book collection may not be of much use to you. So if you're the buy-and-hold type, collecting rare books can be a wonderful way to preserve your wealth and pass it down to future generations. 

An investment portfolio that includes rare books is better positioned to withstand market cycles and provide long-term growth that extends well beyond retirement day. Rare books have historically proven to hold and appreciate in value in the long run.

The most important thing to keep in mind is that very few first editions are actually valuable. A book’s market price is dependent on many factors, including condition, scarcity, and demand. For instance, the Harry Potter novels are very popular, but so many first edition copies were printed of the later books in the series (12 million for Harry Potter and the Deathly Hallows) that even fine copies are worth next to nothing.

On the other hand, some books that are scarce on the market are of little monetary value simply because there is no demand for them. And a first edition that sells for thousands of pounds in fine condition may have almost no value if it is damaged or missing pages. Additionally, books that are not first editions can be considered collectible for a variety of other reasons if they are inscribed by the author, have been owned by a famous person, or are specially bound or illustrated.

If you are just getting started, you should begin attending local events such as auctions, fairs, and book sales to broaden your reach and understanding of the sector. And don't be afraid to ask booksellers and fellow buyers about their experiences and expertise.

A book lover is often more than happy to share their love of books with you, and you stand to pick up some valuable titbits for starting your own collection. 

As with other "hard assets" like fine art, wine, stamps, or baseball cards, half of the fun is in the collecting. If you don't care, there is no point in buying them. But if you really care and you really love them, then there is no downside.

So how do you tell whether your copy of a book is a first edition? Here are a few points to keep in mind:

The first thing to do is to check the date and publisher of your copy against those of the book’s first publication. Take as an example The Hobbit. It was first published in 1937 by George Allen & Unwin, so a copy with any dates later than 1937, or released under a different publisher’s name cannot be a first edition.  (Though this does not exclude the possibility that it is a second or third printing published in the same year as the first, as often happens.) If you’re not sure about the date or publishing company then try Googling for information. Wikipedia is also a good enough place to start when looking for this information.

Many modern publishers label books as first editions, stating something like ‘first edition’ or ‘first printed in 1997′. This is a good indication that you have a first edition, but it’s not always accurate. It may simply be the first edition produced by that particular publisher.

Some modern books have lists of other titles available by the same author. Make sure yours doesn’t include any that were published later. For instance, a first edition of Casino Royale should not say that any of the other James Bond books are available. Also make sure that the dust jacket does not advertise any later books.

Check the dust jacket for quotes from critics and notices of literary awards because these almost never appear on first editions. A copy that says something like “Shortlisted for the Booker Prize” is unlikely to be a first edition.

Posted on 2 July 2019 in: Auction life