What is Scripophily?
by Bob Kerstein , CEO
(scrip-af-il-ly), the collecting of canceled old
stocks and bonds, gained recognition as a hobby around the mid-1970s. The
word resulted combining words from English and Greek. The word "scrip"
represents an ownership right and the word "philos" means to love. Today
there are thousands of collectors worldwide in search of scarce, rare, and
popular stocks and bonds. Collectors who come from the a variety of
businesses enjoy this as a hobby, although there are many who consider
Scripophily an good investment. In fact, over the past several years, this
hobby has exploded. Modern Dot companies and Scandals have been
particularly popular. You can find our more about modern collectible stock
certificates at ModernStocks.com
Many collectors like the historical
significance of certificates. Others prefer the beauty of older stocks and
bonds that were printed in various colors with fancy artwork with ornate
Many autograph collectors are found in
this field, looking for signed certificates of famous people like
John D.Rockefeller of
Standard Oil Company,
Franklin Fire Insurance
Company signed by famed economist Henry Carey issued in 1836,
Barnum & Bailey Circus,
Eastern Air Lines with
Captain Eddie Rickenbacker as President,
by George Bush's Great Grandfather Samuel Prescott Bush,
and many others. As many certificates become harder to find, Scripophily is
an exciting hobby with lots of challenges and potential. Since the hobby is
relatively new (around 20 years), it prices are still very reasonable.
Where can you find a 100 year old piece of history with a an excellent
engraving for under $40? Fortunately, the hobby hasn't hit the boiler room
call centers yet!
There are many reasons that contribute to
the success of this hobby. First of all, it is a worldwide collectible since
almost all countries of the world have issued stocks and/or bonds through
their governments or businesses. Each certificate is a different piece of
history. It describes the company, the type of instrument (usually stock or
bond), the year, signatures of officers or officials, who it was issued to,
the printer, due date for bonds, and much much more. Many of the
certificates have pictures or vignettes showing anything from cars to trains
to Indians to leaders to nothing at all.
Due to the computer age, more and more
stock and bonds are issued electronically which means fewer paper
certificates are issued as a percentage of actual stock issued. During the
past several years, the Internet has played a major role in the awareness of
The hobby of Scripophily is one of
the most fascinating areas of financial history. Over the years there have
been millions of companies which needed to raise money for their
businesses. In order to do so, the founders of these companies issued
securities. Generally speaking, they either issued an equity security in the
form of stock or a debt security in the form of a bond. However, there are
many variations of equity and debt instruments. The can be Common Stock,
Preferred Stocks, Warrants, Cumulative Preferred, Bonds, Zero coupon bonds,
Long Term Bonds (over 400 years) and any combination thereof.
Just as each company is different, each
certificate is different as well. The color, paper, signatures, images,
dates, stamps, cancellations, borders, industry, Stock Broker, name of
company, transfer agent, printer, holder name all add to the uniqueness of
the hobby. Each company needed to raise money to get into business. Each
company had their own story as to how they did it. These certificates give
us a piece of that story.
Some of the companies became major success
stories. Some the companies were acquired and merged into other companies.
Some of the companies and industries were successes for of time, but were
replaced by improvements in technologies. The railroads are a good example
Most the companies, however, never made it
and the certificates became worthless pieces of paper....until the hobby of
Scripophily came along! There were many bubbles that came and went. The
mining boom in the 1850's, the railroad build out beginning in the 1830's,
Oil Boom beginning in the 1870's, Telegraph beginning in the 1850's,
Automobile Industry beginning at the turn of the 20th, Century, Aviation
beginning around 1910 after the Wright Brothers, Electric Power Industry in
the 1930's, Airline Wars and Takeovers beginning in the 1970's, Cellular
Telephones beginning in the mid 1980's, Banks in the 1930's, Saving's and
Loans in the 1970's, Long Distance Telephone Service in the 1990's, and
most recently the Dot Com rags to riches to rags chapter.
There are many factors that determine
value of a certificate including condition, age, historical significance,
signatures, rarity, demand for item, aesthetics, type of company, original
face value, bankers associated with issuance, transfer stamps, cancellation
markings, issued or unissued, printers, and type of engraving process.
- The grading scale that could be used in stocks and bonds is shown below.
Generally speaking, however, the grading is not used in the hobby as
strictly as it is in coins and stamps. Most people acquire certificates for
the artwork and history. Fortunately, the hobby has not made it to the
- Uncirculated - Looks like new, no
abnormal markings or folds, no staples, clean signature and no stains
- Extremely Fine - Slight traces of
- Very Fine - Minor traces of wear
- Fine - Creased with clear signs of
use and wear
- Fair- Strong signs of use and wear
- Poor- Some damage with heavy signs of
wear and staining
- Usually the older the more valuable, but
- What product did the company produce? Was it the first car, airplane,
cotton gin, etc. Did the company make it? Was it a fraud? What era was the
item issued i.e. during a war, depression, industrial revolution?
- Did anyone famous or infamous sign the
Certificate Owners Name
- Was the certificate issued to anyone famous or a famous company?
- How many of the certificates were issued?
How many survived over the years? Is the certificate a low number?
Demand for item
- How many people are trying to collect the same certificate?
- How does the certificate look? What is in the vignette? What color of ink
was used. Does it have fancy borders or writing on it?
Type of company
- What type of company was it issued
for? Does the industry still exist? Has the industry changed a lot over the
Original Face Value
- How much was the stock or bond
issued for? Usually, the larger the original face value, the more
collectible it is.
Bankers associated with issuance
- Who worked on the
fund raising efforts? Was it someone famous or a famous bank? Is the bank
still in existence? - Who worked on the fund raising efforts? Was it someone
famous or a famous bank? Is the bank still in existence?
- Does the certificate have tax stamps on it
- imprinted or attached? Are the stamps valuable or unusual?
- Are the cancellation markings interesting
to the item. Do they detract or add to its history and looks?
Issued or unissued
- Was the item issued or
unissued. Was the certificate a printer's prototype usually stamped with the
words specimen? Usually the issued certificates are more valuable and
- Who printed the certificate? Was it a
Type of engraving process
- How was the certificate made? By hand? By Wood engraving? Steel
Engraving? Lithograph? Preprinted Form?
- Was the paper use in the printing high
quality or low quality. Has it help up over time? Does it have a watermark
used to prevent counterfeiting?
As you can see, Scripophily is more than
just collecting another piece of paper. It is collecting history. It is
something everyone from all ages and all parts of the world can enjoy. The
more you see, the more you collect, the more you appreciate that stocks and
bonds were the monetary fabric that built the world as we know it today.