Purpose. The ultimate reason to record serial numbers is to help us get a "feel" for the rarity of different types of certificates.

But let's not overstate the case. Rarity does NOT establish value. By itself, rarity influences desirability and hence influences value to some degree. Yes, it is true that all other things being equal (age, attractiveness, condition, autographs, etc.) rare certificates often cost more than common certificates. However, there are thousands upon thousands of examples where common certificates are worth more than rare certificates. Do not confuse yourself into thinking that rarity is the most important influence on value.

It would be nice...to have a full record of all serial numbers from every variety of certificate. That will never happen. The most we can ask is a beginning.

By early 2010, there are almost 100,000 numbers recorded so far, which means we are essentially at the beginning. At this point, the more serial numbers we record, the better we can understand which certificates are rare, and which are common.

The secondary reason to record serial numbers is to help discover new varieties. Gaps or differences in serial numbers often tell us to look more closely at certificates that flank the gaps. So far, the study of serial numbers has disclosed a couple hundred new varieties. More are waiting to be discovered.

I use a $25 minimum which means I only record serial numbers for certificates worth more than $25. Otherwise, I would not have time for anything else in my life.

NEVER assume that value is related to the total number of serial numbers reported. The most common certificates are greatly under-represented in the database.

I REQUIRE images of certificates for all serial numbers. I generally ask to see certificates before I enter any new serial numbers into the database. I do this for several reasons.

• it prevents the insertion of fictitious numbers
• it allows review of images when trying to confirm new varieties
• it allows review in case serial numbers seem out of date order
• even the most picky collectors make mistakes in identifying certificate varieties
• even the most picky collectors make mistakes in deciphering handwritten dates and serial numbers
• numerous tests have proven that it takes longer to enter info from lists of serial numbers than from copies

"Some of your serial numbers seem wrong." Agreed. Some serial numbers in the database are wrong. Handwritten serial numbers and dates can be very hard to read. Mistakes are common. Even the most experienced dealers and collectors make mistakes.

Serial numbers come from thousands of sources and every source is prone to error. Be assured that accuracy ranges from perfect to highly questionable.

Sources of serial numbers in the database:

• copies of certificates sent by collectors and dealers
• lists of certificates in museum and private collections
• serial numbers listed in sale catalogs
• photos in auction catalogs
• photos in books
• photos in dealer price lists
• photos on internet auction sites
• photos on dealer internet sites

I do NOT include serial numbers from bond coupons. Just because coupons exist does NOT mean collectible bonds exist.

Mistakes occur when trying to read characters of similar shapes, especially when characters are handwritten. These groups of letters and numbers create the greatest number of mistakes:

• O, 0, U, D, C, G
• B, E, F, P, R
• 1, 4
• 2, 7, 9
• 3, 8
• 6, 0

Prefix and suffix letters. While serial numbers often carry prefix and suffix letters, catalogers rarely such characters. As a rule, they catalogers also drop leading zeros. This is too bad, because prefix, letters, suffix letters and leading zeros are very important.

Oftentimes, prefix letters indicate specific series of certificates. For instance, "C", "V" and "M" were commonly used as prefixes for serial numbers on $100, $500, and $1000 bonds. If a "C" serial number on a bond is reported for a variety otherwise populated by "M" prefixes, then there is definitely an error.

Serial number prefixes were also often used to distinguish between common ("C") and preferred ("P") stock certificates.

Less frequently, companies used "C", "P", "B", and "N" prefixes to indicate certificates were issued in Chicago, Philadelphia, Boston, or New York.

Prefix letters on late-date certificates often indicated different series of issuances. This is particularly true as heavy trading in the 1960s and 1970s prompted the issuance and redemption of tens of thousands of certificates per day.

If you find one or two serial numbers out of date order in a large sequence, then chances are very great that dealers and collectors misread dates. Sometimes certificates carry two and sometimes three dates and multiple date can help clarify problematic numbers.

However, there are hundreds of examples of valid serial numbers that are definitely out of date order.

How can date order could get messed up? It may seem strange, but it is quite common to see low-numbered certificates issued out of date order. Sometimes, low-numbered certificates were dated several months after companies incorporated and after higher-number certificates had been issued. It seems possible that such certificates might have been set aside for "special" investors and friends of management.

Companies often issued temporary certificates immediately after incorporation and replaced them a few months later with engraved "permanent" certificates. Depending on the company, permanent certificates often replaced identically-numbered temporary certificates. Some companies wrote the new certificates with original dates and some used actual dates of replacement.

Normally, when stock certificates were sold to new investors, old certificates were sent back to companies, which then transferred ownership and issued new, higher-numbered certificates. For unknown reasons, a few companies reused their old numbers. Sometimes companies indicated their new certificates with suffix letters, but catalogers often fail to report those suffixes today.

Companies often used prefix letters to indicate cities where certificates were sold. For instance, certificates C1 to C3000 might have been issued in Chicago and certificates N1 to N27000 might have been issued in New York. Certificates from the two cities never sold at the same rates. Therefore, when collectors and dealers fail to report prefixes, serial numbers and dates will seem highly confused.

Similarly, batches of certificates may have been divided between two or more brokers, trust companies, transfer agencies, or exchanges. In those cases, serial numbers would NEVER have been in strict date order.

Gaps in numbering. Companies often switched designs of certificates as they became successful. As a rule, most companies kept the same general numbering scheme, but often jumped a few hundred or a few thousand numbers between successive certificate orders. Consequently, large and legitimate gaps may occur in serial numbering.

Unless entire books of certificates have been reported, gaps occur in every variety. Take, for instance, BAL-662b-S-30. About 180 numbers of extant certificates have been reported out of a known range of 58,226. Do the other 58,000 certificates exist? Probably 10,000 do. I doubt, however, today's collectors will report more than a couple hundred more. We will be left with thousands of gaps in numbers. Regardless of how many certificates we may think exist, most of us should agree that S-30 from the BAL-662b, Baltimore & Ohio Rail-Road Co. is a very common certificate.

On the other hand, collectors have only reported six examples of stock certificate variety S-37 from a later name variant of the B&O (BAL-662d). These six meager examples span a 600 number range, so there are large and significant gaps in numbering. How many of those certificates exist. Ten? Twenty? Fifty? Who knows? The gaps in the numbering of BAL-662d-S-37 are much more significant and meaningful than the gaps among BAL-662b-S-30.

Repeated numbers. Unfortunately, each time they changed certificate designs, some companies re-started serial numbering with certificate #1. When you find repeated numbers for certificates of the same company, you often find that they signal multiple incorporations of the same company.

There are times, of course, when repeated numbers mean absolutely nothing.

That often seems to be the case for companies that used two or more certificate designs simultaneously, particularly when they sold certificates in both domestic and foreign markets.

You WILL find strange numbering. It is best to assume that all examples of strange serial numbering had legitimate reasons. However, explanations for such strange corporate behavior are now lost to history and you will drive yourself crazy trying to discover the reasons.

Some strange numbering results from listing behavior by catalogers and dealers. There are many instances where auction catalogs (particularly German catalogs) show pictures of certificates not actually being offered for sale. If correspondents send such images to me, they may not realize they are mismatching dates and serial numbers.

These kinds of mistakes are one of the main reasons I now require photographs before adding serial numbers to the database.

Low serial numbers. European collectors frequently pay more for certificates with very low serial numbers. So far, low serial numbers rarely command much of a premium among U.S. collectors.

How "low" is "low"? European collectors often pay a 25% to 40% premium for #1 certificates and perhaps a 10% to 20% premium for #2 certificates. #3 certificates sometimes see as much as a 10% premium, but certificates numbered above that level rarely attract much attention.

Do not be too "snooty" in your pursuit for low serial numbers. They may not exist.

Remember that railroad companies often continued their old serial numbering when they switched certificate designs. Therefore, the lowest serial number for a particular stock certificate designs might have been 101, 1,001, or even 100,001.

In fact, a recent review of reported serial numbers strongly suggests that over half of all varieties of stock certificates never had serial numbers below 100. Simply put, you have no hope of finding serial #1 for over half of all varieties of stock certificates because they never existed!

Need more convincing? A deeper review of the database suggests that almost one third of all varieties of stock certificates had a minimum number above 500.