The current gold and silver markets have been booming these past five years and there are hundreds of businesses that have just started purchasing gold and silver. Unfortunately this means there are also hundreds of options for the average public to sift through when trying to sell an item. Although for the most part the value of the metal an item is made of is usually higher than the numismatic value it has, it is important to know what you have before you make the decision to sell or keep it. We have found that many of our customers were unaware of the differences between the types of money and bullion out there in the world today, and what it can mean to a buyer or seller. When we meet with an investor or collector that is new to the trade we try our best to offer them this knowledge.
1878 Morgan Silver Dollar with rainbow patina. Some collectors value the patina of a coin very highly. Collectors will de-value a coin if it has been cleaned in any way.
First, a few definitions. Numismatic value is defined as the collector’s value of an item. This applies to coins, tokens, and paper money. Numismatic value is an amount the item is valued above the monetary amount printed on the item by government authority. Example: If a $2 bill in very fine condition is to have numismatic value, the value of the item according to how collectable it is must be above $2. Numismatic value is determined by three things: The rarity of the item (how many were made?), the demand of the item, and the condition of the item. For instance, Carson City silver dollars are almost always valued higher than other mintages due to collectors favoring the history of this mint location. This is an important factor to remember about numismatic value: an item’s age does not determine it’s value. Just look at all the 8 Reales from the 18th Century you can find on Ebay for under $100! Some are even for sale for under 40! You would think something over two hundred years old would belong in a museum, but if there were a lot of them made then they are not considered rare or very valuable.
Not all silver coins have numismatic value. Most Washington Quarters are worth more in Silver value.
Money is any medium of exchange, measure of wealth or means of payment stamped by government authority and used as common currency. Coins are a form of this medium, and are valued by their face or monetary amount which is determined by government authority. In history, coins were sometimes made out of metals that are now considered precious and as such exceed their face value today. A coin can also be made out of other metal mixtures that do not necessarily represent the face value of the coin. Most importantly: because of the rarity, condition, or demand for certain coins they can sometimes exceed the metal value in which they are made of. It is important when looking to sell a coin that you look up the value yourself, or bring the coin to an expert who can evaluate the grade (or condition) of your coin for you and tell you what it is worth.
Early Commemorative Half Dollars are a great place to start your collection! They are plentiful and have varied prices.
Commemorative coins come in many forms. Some commemorative coins were used as currency and issued by a government authority. Some were issued by a government authority but were always considered a “special edition” and not issued for currency purposes. Commemorative dollars and half dollars have been issued since the late 19th Century. Originally they were purchased at celebratory gatherings for a little more than their monetary worth as a memento of the event. Later on U.S. commemorative coins were available only by direct purchase from the U.S. Mint. Most of these were specially decorated forms of currency used to commemorate an anniversary, historical figure, or event. Usually these coins are made of silver, zinc, copper-nickel, or a mixture of these metals. Because they are issued by government authority these coins may have numismatic value that exceeds the metal value.
At first glance this item looks like it might be issued by the U.S. Mint as .999 Silver Bullion, upon closer inspection it is discovered this is actually a 925 Sterling Silver medallion issued by a private company.
Medallions (also called “medals”) are round metal items that are often mistaken for bullion or coins. Medallions are issued by private mints, clubs, and companies, but are never issued by a government authority. They very often have commemorative purposes such as bi-centennials, local events, historical events or figures, award ceremonies, and sometimes they are replicas of actual government issued coins. Medallions issued by companies like the National Baseball League and the Franklin Mint sometimes fall into this category. Medallions are not .999 pure metal and as such cannot be qualified as bullion by mint authorities. (It is important to note that the same companies often issue bullion as well.) Some come with certificates stating a less then pure metal content, some do not. Medallions have been issued in gold, silver, bronze, brass, copper, zinc, nickel, and all sorts of mixtures of these common metals. Sometimes companies will make it seem like medallions currently have or can acquire numismatic value with time, however this is not the case. Even when these items are numbered (sometimes marked 136/500 etc.) if their mintage cannot be proven by a trusted authority (like a government), and they were never used as currency, they will not appreciate with time.
Some designs for gold bullion can be intricate, and may sell for a slightly higher premium because of the favorable design.
Bullion value is considered by weight and purity of metal commodity rather than monetary amount even though it may have a monetary amount assigned to it. Bullion will also have it’s purity levels (.999) and what metal commodity it is made out printed on it and guaranteed by the government or assayer it was issued by. Bullion comes in rounds (not to be mistaken for coins or medallions), ingots, and bars. Bullion will very rarely have any numismatic value above what it’s metal value is due to it’s purity and the fact that most bullion is relatively new. Finally, money is always government issued and regulated where as bullion can be issued by a government or any other certified assayer.
Check back with us next blog for more information and advice on money, coins, and bullion!