20 gauge A.H. Fox XE shotgun: Really a good investment?…

20g Fox XE double barrel shotgun
20g Fox XE double barrel shotgun

“Investment” is a word that comes up a lot in the gun circles, as in “..right now, shotguns like this are excellent investments.” Statements like this make me think “maybe”.

To see what I mean, let’s consider this 20 gauge A.H. Fox XE side by side. It sold a couple weekends ago at Rock Island Auctions for $20,700. This same gun changed hands back in 2008 at Julia’s spring firearms auction for $14,950. (BTW: here are some better pics of it: 20g Fox XE double barrel shotgun, spring 2008).

So here were have a A.H. Fox 20 gauge XE selling twice in 4 years. Was the gun a good “investment”. Lets run some numbers and see.

First, we need to adjust the sale price. Both auctioneers are include a 15% buyer’s premium in the prices they show. We need to take this out to get the real sales prices: $18,000 in 2008 and $13,000 in 2012. This cuts the 4-year gain down to $5000. Still not bad.

Next, lets consider the seller’s premium. This fee is negotiable and if you bring the right stuff to an auctioneer, it can fall to zero. To keep things simple, we’ll just assume that the seller rung all the right bells and paid 0%.

Finally, there are the miscellaneous fees and taxes. Shipping the gun back and forth both times probably cost the seller several hundred dollars. We’ll use $250. Tax wise, since the seller had the gun for over a year, the gains will be dinged  28% – if the seller pays paid them. Most gun auctions don’t process 1099s on sales, so paying capital gains on stuff is totally up to the consignor. Of course, Uncle Sam says it’s something they must do.

This final bit of figuring knocks the gains down to $4750 without taxes and $3420 with them. So what kind of return is this over 4 years? If my math is right (and it may not be), the seller’s looking at 8.0% and 6%. That’s not bad. In this case, I would say that this gun was a decent place to stash some money for a few years.

What do you think?

BTW: please let me know if my calculations are wrong. I’m a writer, not an accountant or financial analyst.