Silver Coins Value Guide

Silver Coins Value

Whether you are considering investing in the silver market or perhaps hope to start a silver coins collection one day, it is essential to learn how to assess silver coins value. Our comprehensive guide will help you navigate among a plethora of choices that exist on the market today. By no means should this guide replace professional advice from a precious metals investment specialist, however it can shed some light on the basics of silver coins value for beginners.

Just like with any commodity, assessing silver coins values is not an easy task; it requires a trained eye, understanding the basics of the silver market and knowing three major categories of silver coins. Each of these categories will have a unique set of factors affecting its value that are worth knowing before you begin investing or collecting.

Silver Bullion Coins

Issued by many different international government mints, silver bullion coins are one of the most popular ways to invest in the silver market. The silver coins value is mostly derived from the intrinsic value of the precious metal it contains based on the current price of a troy ounce of silver. The spot price of silver is determined by international commodity stock exchanges twice daily. This complex process of determining a spot price of any precious metal is controlled by five major bullion dealers in the world called Gold Fixing. The spot price of silver is a major contributor to the silver coins value, however there are other factors that affect the final market price of a single bullion coin. These factors include bullion manufacturing costs and dealer premiums, mark ups that bullion dealers charge for their services. Premiums vary depending on the type of bullion coin; some coins might enjoy a higher demand among investors thus dictating higher premium costs.

A standard silver bullion coin contains 1 troy ounce of pure silver; however the coin itself may weigh more to account for an alloy content, if it contains any. Some bullion coins are also minted in smaller denominations ranging from half, quarter and one tenths of a troy ounce. Bullion silver coins value fluctuates several times daily because it directly tracks the spot price of silver. Bullion silver coins prices contain just a small dealer premium and are considered one of the most economical ways of investing in the value of silver precious metal.

Bullion silver coins value is used as a hedge for inflation since it moves in the opposite direction with market trends. In favorable market scenarios with low inflation rates, prices for precious metals bullion coins stay low. Should economy take a sudden dip, this will inevitably affect the values of silver coins pushing them up. This scenario was witnessed during the recent economic downturn in 2009 when spot price of silver sky rocketed to historical high levels of over $40 for one troy ounce. Those investors, who were in possession of silver bullion coins were able to actually profit from market woes by selling off portions of their precious metals portfolios.

In addition to the state of economy, effect of large investors is a crucial factor that many investors tend to overlook when it comes to assessing silver coins value. Large investing funds or groups can inadvertently affect this value in the upstream or downstream deciding to purchase significant silver assets or, on the contrary, trying to sell them off. Many smaller investors do not have control over this but this should be taken into consideration when purchasing silver bullion coins.

Consumer demand is an important factor that needs to be taken seriously. If the consumer demand for certain silver coin is high, so is its value. Consumer demand can change unexpectedly and is considered a very volatile factor.

Collectible Silver Coins

Another category of silver coins is presented by a wide range of numismatic coins minted by various countries in different historical periods. The collectibles silver coins value determination is far more complex compared to bullion coins and goes beyond intrinsic value of silver it contains.

Grade of coins is a huge factor while assessing numismatic silver coins value.. Grade of the coins is basically the condition they are in. The coin grades range from gem mint to basal and could only be assessed by professional coin grading agencies or skilled numismatists. The higher the grade the higher is the silver coins value.

Collectors’ demand should also be taken into the equation when determining silver coins value. Even if your coin is rare and is in the mint grade, if there are no collectors wishing to buy it at the time for various reasons, you are not going to get a lot of money for it. Collectors’ demand is very unpredictable and can easily change over a course of weeks, months or years.

Rarity and scarcity are very tricky factors that go into play when evaluating numismatic coins. The fewer the coins of this kind are on the market, the higher the value of a coin is. In fact, age of the coin and mintage year does not necessarily dictate its price. For example, some old Chinese or Mexican silver coins will sell for much lower than 1913 Liberty Head Nickel because there are just a few of the latter left in the numismatic world. Again, rarity and scarcity could only be determined by professionals.

Since all these factors add up to the final price of numismatic silver coins, you should stay away from this category if you are trying to strictly invest in the spot price of silver metal and stick to bullion. The general rule is: bullion is for investors and numismatics are for collectors, especially if you do not possess enough knowledge to assess collectible silver coins value.

Junk Silver Coins

In addition to bullion and numismatic coins circulating on the market there are also junk silver coins that are worth no more than their melt value of silver. These coins are not actually “junk” per se but are coins struck in the US before 1964 but are of poor grade to be considered valuable for coin collectors. Before 1964 the US Mint had been striking quarters, dimes and nickels containing 90% of pure silver, however it was stopped in later years due to rising silver prices. Most of junk silver is sold in bags of various sizes with denomination values from $1 to massive $1000 bags that account to 715 troy ounces of silver metal. Since junk coins could be purchased for a fraction over the current spot price of silver and minimum premiums, these are considered by some investors to be great ways to acquire silver into their precious metals portfolios. Additionally, junk silver coins are excellent to have on hand for the events of catastrophic proportions for survival benefits when national currencies default and only true precious metals remaining a solid means of payment.

Junk silver coins value is directly affected by the market fluctuations of the spot price of silver. Additionally, high or low industrial demand of silver drives their values up or down accordingly. Industrial applications of silver are limitless. Silver is a rare metal that is used in various industrial areas beyond jewelry making. Silver is necessary to produce solar panel cells, automotive, medical equipment and electronics. Commercial demand for silver follows market trends. Silver is used widely in dental and medical field with more and more emphasis made on products that are silver based like clothing, computers, cell phones and many more.