What are Bonds and Shares?

A bond or a share or stock certificate is a document given to an investor as evidence of ownership of an amount of capital. Usually these documents are on part-printed forms that are signed and sealed at the time of issue to the investor, personal details being entered in manuscript or overprint at the same time. They are usually signed by directors of the issuing body and sometimes by the investors.

Shares are issued by businesses and form part of the permanent capital of the business. Usually, shares are not repayable, and the investor can recover his money only by selling to another investor. Shares are of many types, originally giving different rights to the holders, and now providing varieties for scripophilists to collect. The most usual are Ordinary (or Common), Preferred and Deferred. Most shares earn dividends at the business's discretion, depending on how well it has traded.

Bonds represent a loan to a business or to a government or other public body, or sometimes an individual. They are usually repayable within a stated period. Bonds earn interest, usually at a fixed annual rate, which must generally be paid by the company or other body, regardless of its financial results. Bonds may be unsecured, or secured on the borrower's assets (Debentures or Mortgage Loans) and may be payable in gold coins ('Gold Bonds') or as an amount related to the price of a basket of commodities ('Inflation Bonds')hoo

Where do Bonds and Shares come from?

The vast majority of bonds and shares collected by scripophilists are in one sense or another 'defunct'. There are various ways in which they become available to collectors.

Governments in many parts of the world have reneged on their bond obligations, usually due to a change in government after a revolution, or because they lost a war.

Companies go into liquidation, their outstanding bonds and share certificates often becoming worthless.

Certificates may be redeemed (repaid), or, on a merger, replaced by the certificates of a different company. The certificates are called in by the company, cancelled, and disposed of as scrap, either at once or after a period of storage.

In many cases, certificates become valueless when the underlying stock is transferred to a new owner, or following a re-organisation. They are sometimes returned to the company for cancellation and disposal,
or may be retained by the holders.

Some certificates came to light after having been lost and replaced by duplicates.

Many certificates remain un-issued through lack of demand and are eventually disposed of.

Buying

The I.B.S.S. Directory includes the addresses of more than 100 dealers and auctioneers.

When buying, compare prices from dealer to dealer - they can sometimes differ quite considerably. Many dealers issue regular lists. Let the dealers know your interests; they can often find what you are looking for. However, do not expect them to produce what you want off the shelf; the variety is enormous and very many pieces are available in small numbers only. Indeed, many pieces are so rare that no dealer has any in stock.

There are a number of auction houses in the United States and Europe which hold scripophily sales 2 to 4 times a year, and usually send out their catalogues well in advance, allowing plenty of time for postal bidding. Many, but not all, charge a small fee for their catalogue. In almost all cases a premium (often 15% plus taxes) is payable by the buyer on the 'hammer price' of the lot; this can vary considerably from auction-house to auction-house, and must be borne in mind when deciding how much to spend.oo

Many collectors like to buy at bourses. The word bourse, normally meaning a stock exchange, is used in scripophily to mean a fair or show, where many dealers (and collectors) come together to offer their material. Bourses are often arranged to accompany auctions. They are an excellent opportunity, not just to buy certificates, but also to meet dealers and collectors, to see a wide range of material, and to compare stocks and prices.