The fixed catalogue price of collectible stamps becomes the median of the stamp dealer’s price. A stamp dealer may buy or sell postage stamps either higher or lower than the philatelic catalog price.

On the other hand, the stamp value is the appraised price of a postage stamp relative to its stamp grade and condition.

Simply put, if Aunt Martha wants to sell her grand pa’s stamp collection to the local stamp dealer Mr. Smith, she refers to the stamp catalogue for a quick price guide. However, Aunt Martha’s stamps, though they date back to the 1940s, are wrinkled. So Mr. Smith gives Aunt Martha a postage stamp value that is lower than the listed stamp price.

Why do stamp prices go up?

To understand the postage stamp price better, think of the stamp - whether it is a collectible stamp or merely a postage payment - as a commodity. Just like all things for sale, the price of stamps depends on the supply and demand.

Stamp collectors create the demand for philatelic stamps. Rare postage stamps, since their demand exceeds their supply, therefore has a higher stamp price.  

Postage stamp prices also go up during inflation. To address the rise of stamp cost during economic instability, the United States Postal Service issued forever stamps. These stamps are valid for first class postage even if stamp prices go up.

Times of social unrest also trigger the rise of postage stamp price.  For example, the US stamp price history rose to three cents in 1917 during the onset of World War I.

Commemorative stamps are always sold higher than ordinary postage stamps. Commems carry a premium or mark up price which goes to the beneficiary of the commemorative stamp program.

Thematic stamps has a more volatile stamp price. Topical philatelists are known to be vigilant in completing a philatelic album of their favorite topic.

Philatelic covers from space shuttles, for instance, have sky high philatelic prices during the course of the space mission. When the philatelic market for these thematic items becomes lukewarm, their prices go down.

Collectible stamp prices are also relative to the philatelic bureau selling the postage stamps. If you are in Canada and you want to buy Indian stamps at the local stamp shop, you might have to pay a higher collector stamp price to shoulder the shipping costs.

Secrets of the philatelic market

The stamp collecting market is where philatelists and stamp dealers do business either in actual or through the internet. New stamp collectors should know the customary practices between philatelists and stamp dealers before taking the big leap to stamp investment.

The philatelic market analysts study the collector stamp price trends. In stamp trading between one collector to another, they usually keep their collectible stamp price lower by 3/4s than the catalogue price.

Philatelic dealers often disregard the stamp catalogue price. Rather, they set their own standards known as the stamp dealer’s price. If a dealer got his postage stamp from a stamp auction and it was sold higher than its catalog price, you can not expect the dealer to resell his stamp at a lower value.

In selling a stamp collection, dealers base their price on the stamps that they deem valuable. Definitive stamps or the common postage stamps have low turn over rates.

Rarer stamp specimens have higher philatelic values and can easily be disposed.

Suppose you want to sell your philatelic collection to a stamp dealer. Your stamp album contains 125 pieces of definitives and a 10 pieces of error stamps.

Upon appraisal, the value of your entire collection is set on the price of the error postage stamps which have a bigger philatelic value.

How to do a stamp investment

Acquiring collector postage stamps is considered an alternative investment. Your rare postage stamp investment is a good inflation hedge.

For a cunning postage stamp investor, it is wise to buy collectible stamps during inflation. Economic instability leads to a bear market. This is the time when people start to sell things they do not really need.

Remember, the cost of stamps as a postage payment increases, but the price of collector stamps decreases. Most collectors dispose their valuable stamp collection during this period. For a philatelic investor, this is the chance to buy the best quality of collectible postage stamp.

When the economy starts to get better and stamp collectors are once again ready to buy postage stamps, stamp investors sell their stamps for a higher price to gain profit.

What are the disadvantages of philatelic investment?

Just like all other investments, it is not all the time that you are guaranteed to have high returns in a postage stamp investment.

High quality stamps need to be expertised to certify it is genuine. Stamp appraisal and philatelic expertizing entails a fee.

Even if stamps can easily be stored and transferred from one place to another, you still need to ensure them incase they get damaged.

Although the philatelic market is global, it is still small. The patrons of stamp investors are not their fellow philatelic investors but the stamp collectors. This is because collectible postage stamps do not yield interests and dividends.