Ned Downing spent years trading on Wall Street, but it wasn't until he left the business that he bagged his most memorable deal: Bank of North America.
Although the company is defunct and its stock nonredeemable, the share that he purchased for $33,000 was priceless to Mr. Downing because it's perhaps the nation's oldest-surviving stock certificate -- dated June 7, 1783.
"I collect stories in documents. This is the foundation of capitalism. It's our history," he explained.
Though long depreciated, many old stock and bond certificates are gaining in value among a growing number of collectors. An estimated 30,000 people worldwide are involved in the hobby, known as scripophily (pronounced scrip-awfully).
They say they believe antique securities will increase in value as the world moves into the new millennium and electronic trading continues to eliminate the use of paper certificates.
Like Mr. Downing, they scour old company files, estate sales and auctions. Many of these old papers turn up in attics, closets or safe-deposit boxes, dusty and long forgotten.
THE MOST VALUABLE certificates, according to Haley Garrison, owner of Antique Stocks & Bonds of Williamsburg, Va., (www.tiac.net/users/haley/) are those that have historical significance.
Among the most desired periods: Colonial, Civil War and the beginning of any emerging industry, such as banks, oil or railroads. Signatures from famous people such as John D. Rockefeller, William H. Vanderbilt or J.P. Morgan add to the value, especially if the signatures are rare.
Also of value are securities that are appealing aesthetically. Many were engraved ornately with elaborate vignettes crafted by artists to guard against counterfeiting and to entice investors, such as those from mining or railroad companies during the 1800s.
The Atlantic, Mississippi & Ohio American Railroad Gold Bond issued in Virginia in 1871 features a little bit of everything -- elaborate vignettes of trains, landscapes, paddle-wheel steamers, seals, crests and medallions, all surrounded by an ornate border. It's worth about $500 in very fine condition, according to Mr. Garrison.
Stock certificates from International Mercantile Marine Co., which built Titanic, are worth about $700. One from 1905 features a steamer with black smoke billowing from its four stacks. The company is now defunct, having been sold in 1943.
MORE RECENTLY, one of the most colorful and appealing certificates was issued in the 1960s by Ringling Brothers-Barnum and Baily Circus. It featured wild animals, clowns and acrobats. Mattel Inc., which bought the circus in the early 1970s, could persuade shareholders to exchange their Ringling certificates for new ones only after promising to return the originals once they were canceled, Mr. Garrison said.
Also hard to part with for some shareholders were the first certificates issued by Playboy Enterprises after it went public in 1971. It sported the nude image of February 1971 Playmate Willi Rey.
There are fewer elaborate certificates these days; most designs are computer-generated. And that makes the older ones even more valuable, the experts say.
"It's a dying art form," said Jean M. Young, a spokeswoman for American Bank Note Co. in Philadelphia, one of the oldest and largest security printers in the world. ABN has an extensive library of engraved plates, designs and vignettes for virtually all New York Stock Exchange-listed companies.
"When you look in our archives, you see a big picture, which was originally done by the artist ... then scaled down to size," Ms. Young said.
SCRIPOPHILY BEGAN to take off in the United States in the early 1980s, although it flourished in countries such as Germany much earlier.
Fueling that interest has been the emergence of financial museums such as the Museum of American Financial History (www.financialhistory.org), which opened in lower Manhattan, N.Y., in 1988. The museum, founded by world-renowned collector and vintage securities expert John E. Herzog, features antique stocks, bonds and currency, historic documents and photographs, and equipment once used on Wall Street. Its main objective: to preserve American's financial history.
Those with an interest in financial history can start collecting with just a few dollars. Many dealers offer extensive catalogs of available certificates on the Internet or via online auctions.
For instance, you can buy each of the Monopoly collection of railroad stocks, which includes the Pennsylvania Railroad Co. and Erie Railroad Co., for less than $10 apiece. Many Confederate war bonds can be had for less $50.
But you also can spend tens of thousands of dollars like Mr. Downing did at an auction in 1995 for his Bank of North America certificate.
Mr. Downing, a history buff from Weston, Mass., said that the corporation was formed to help raise funds for George Washington's army.
"The certificate was made out to John Carter, an alias for John Barker Church ... brother-in-law of Alexander Hamilton," he explains. "It was Church's dueling pistols that resulted in the death of Hamilton in 1804."
THE FIRST KNOWN stock certificate, which isn't for sale, has been valued for insurance purposes at $600,000. It's from the Dutch East India Co. and dates to 1608. There are also bonds dating to the 1500s, which also go for thousands of dollars.
Mr. Downing suggests collectors become familiar with the historical significance of the certificates they plan to buy.
"Before I started collecting I would read as much as I can about the actual history of what I'm trying to collect and then go after the very best material," said Mr. Downing, a former stock broker who also traded in mortgage-backed securities.
Mr. Garrison collects much the same way and includes researched material about the company with many of the stock and bond certificates he sells.
HE'S ESPECIALLY fond of collecting swindles -- stocks of fly-by-night companies offering get-rich-quick schemes or businesses plagued with scandal -- and sees them as constant reminders that history can, and does, repeat itself.
Among his favorites: Huxter's Chocnog Corp., a company that claimed to have developed a special formula that made cows give chocolate milk; International Money Machine Corp., which claimed to have developed a machine that turned $1 bills into $5 bills; Keely Motor Co., which said it discovered "energized water" that could be used instead of fuel; and Gray Goose Airways, which developed a flying machine that flapped its wings like a goose.
"On its first flight the (Gray Goose Airways) contraption landed on its inventor," but didn't kill him, Mr. Garrison said.