Collecting Silver Coin vs. Collecting Silver Bullion?

Is there a better reason to collect certain silver coins opposed to
silver bullion if your interested chiefly in the weight/$ aspect, and
not so much the metal weight and other factors that coin can bring to
the table in value?

IOW's, what about 1oz Sivler Eagles vs 1oz Silver Bullion investment
bars? The ealges cost more b/c they are a fancier minted coin over
the bullion, but is it worth it?

And one other example, the idea that I have, invest into bags American
sivler dimes & quarters up to 1964 due to their high and precise % of
silver content, (as the weight/$ can be clearly calculted) plus the
coin (minus the silver weight value) itself may have some value added
power, but in and of itself is not a "valuable" enough coin for a
collector, but enough to make it a better investment than just pure
silver?

In article ,
(Jay Quinn) writes:

ubject: Collecting Silver Coin vs. Collecting Silver Bullion?
From: (Jay Quinn)
Date: 30 Jul 2003 13:28:06 -0700

Is there a better reason to collect certain silver coins opposed to
silver bullion if your interested chiefly in the weight/$ aspect, and
not so much the metal weight and other factors that coin can bring to
the table in value?

IOW's, what about 1oz Sivler Eagles vs 1oz Silver Bullion investment
bars? The ealges cost more b/c they are a fancier minted coin over
the bullion, but is it worth it?

And one other example, the idea that I have, invest into bags American
sivler dimes & quarters up to 1964 due to their high and precise % of
silver content, (as the weight/$ can be clearly calculted) plus the
coin (minus the silver weight value) itself may have some value added
power, but in and of itself is not a "valuable" enough coin for a
collector, but enough to make it a better investment than just pure
silver?


The thing to remember, is that it's the "spread" between buy and sell that eats
into your profits, not necessarily the cost of the silver originally. For 90%
coins, the bugaboo is that the refineries set the price...so although you may
be able to calculate the exact percent of silver, they set the price. The
reality is that 90% sells at a premium to melt when silver is low and,
sometimes, sells at a significant discount to melt when silver has had a rapid
runup. For long term investors, however, the possibility of premium coins
being included and eventually bringing a premium price is also a factor.

For silver eagles, the knock is that they're too high priced to used for
investment. LIke 90% when silver is low, they tend to sell at a premium to
their content when silver is low, although this is limited somewhat by the
availability of current year eagles at more or less fixed prices. When silver
makes a rapid runup or other factors (such as national tragedy or strong stock
market) they tend to drop to the lower end of their relation to "spot" price.
The upside, is that several dates seem to maintain a high price (1996s are
still in the $20 range) and others seem to cycle up and down based on
"promotions" or just plain hype. An observant investor can take advantage of
these swings, but you have to watch the market closely.

100 oz Englehards and JMs seem to have a rather stable price range in relation
to bullion, but even those will "swing" 50c (independent of "spot") based on
investor and market demand.

One other thing I forgot to mention, is that only Silver Eagles enjoy the
benefit of being usable in IRAs. This helps stabilize their price, especially
when they drop close to melt price. This is true because while premium values
are determined by collectors and other physical silver purchasers, any old
condition silver eagle can go into an IRA. This is important because many
dates of silver eagles were poorly processed by the US Mint and the resultant
"milk spots" are unsightly and these coins often sell at a discount to the nice
specimens destined for collections.

Dondi3
DONDI enterprises. BUY, SELL, TRADE. RARE COINS & PRECIOUS METALS
Member COINNET, CSNS, ANA, INA, MOON, ILNA.

Certain silver bars are also allowable in IRAs. In fact, any bar allowed for exchange
on the Comex or Nymex is allowed in IRAs. So all you have to do is buy a contract
(at the current "spot" price by definition) and then just take delivery of the bars
(actually, you have to have a 3rd-party trust company hold the bars in a secure
vault for you).

Personally, I like the cheap 90% silver coins. I also like the 40% silver Kennedys
because they currently trade close to face value (very limited downside risk !).

The advantage with 90% coin is that certain coin types can increase in value in the future
regardless of the silver price. In the last couple years, I've seen the price of "common"
circulated Walking Liberty halves, Franklin halves, and Mercury dimes go up, even
when the silver price was flat. Now I see that Littleton Coin is offering $3.50 for
S-mint Franklins (they're picky and probably only buy half of what you send them,
but $3.50 is 7x face in case you didn't do the math !), Also, during the Y2K scare,
90% silver bags were approaching 6x face - way above the melt value at the time.
So they can occasionally trade well above the melt value.

The other advantage of coin over bars is that the coins are easy to divide and authenticate
for their silver content. It can be hard to tell if a bar is full of lead, but much easier to tell
if a coin is full of lead. And, of course, filling a silver coin with lead isn't very profitiable
due to the the labor involved.

And lastly, of course, the 90% coins have a face value which puts a floor under their
value.

"DONDI3" wrote in message ...
In article ,
(Jay Quinn) writes:

ubject: Collecting Silver Coin vs. Collecting Silver Bullion?
From: (Jay Quinn)
Date: 30 Jul 2003 13:28:06 -0700

Is there a better reason to collect certain silver coins opposed to
silver bullion if your interested chiefly in the weight/$ aspect, and
not so much the metal weight and other factors that coin can bring to
the table in value?

IOW's, what about 1oz Sivler Eagles vs 1oz Silver Bullion investment
bars? The ealges cost more b/c they are a fancier minted coin over
the bullion, but is it worth it?

And one other example, the idea that I have, invest into bags American
sivler dimes & quarters up to 1964 due to their high and precise % of
silver content, (as the weight/$ can be clearly calculted) plus the
coin (minus the silver weight value) itself may have some value added
power, but in and of itself is not a "valuable" enough coin for a
collector, but enough to make it a better investment than just pure
silver?


The thing to remember, is that it's the "spread" between buy and sell that eats
into your profits, not necessarily the cost of the silver originally. For 90%
coins, the bugaboo is that the refineries set the price...so although you may
be able to calculate the exact percent of silver, they set the price. The
reality is that 90% sells at a premium to melt when silver is low and,
sometimes, sells at a significant discount to melt when silver has had a rapid
runup. For long term investors, however, the possibility of premium coins
being included and eventually bringing a premium price is also a factor.

For silver eagles, the knock is that they're too high priced to used for
investment. LIke 90% when silver is low, they tend to sell at a premium to
their content when silver is low, although this is limited somewhat by the
availability of current year eagles at more or less fixed prices. When silver
makes a rapid runup or other factors (such as national tragedy or strong stock
market) they tend to drop to the lower end of their relation to "spot" price.
The upside, is that several dates seem to maintain a high price (1996s are
still in the $20 range) and others seem to cycle up and down based on
"promotions" or just plain hype. An observant investor can take advantage of
these swings, but you have to watch the market closely.

100 oz Englehards and JMs seem to have a rather stable price range in relation
to bullion, but even those will "swing" 50c (independent of "spot") based on
investor and market demand.

One other thing I forgot to mention, is that only Silver Eagles enjoy the
benefit of being usable in IRAs. This helps stabilize their price, especially
when they drop close to melt price. This is true because while premium values
are determined by collectors and other physical silver purchasers, any old
condition silver eagle can go into an IRA. This is important because many
dates of silver eagles were poorly processed by the US Mint and the resultant
"milk spots" are unsightly and these coins often sell at a discount to the nice
specimens destined for collections.

Dondi3
DONDI enterprises. BUY, SELL, TRADE. RARE COINS & PRECIOUS METALS
Member COINNET, CSNS, ANA, INA, MOON, ILNA.

"D Carr" wrote in message
...
snip
Also, during the Y2K scare,
90% silver bags were approaching 6x face - way above the melt value at the
time.
snip

Yes, the kook factor!

"Edwin Johnston" wrote in message ...

Yes, the kook factor!

Hey, don't knock the kooks, without them who'd buy all the surplus
duct tape?

Seriously though, addendum to getting coins. Check out coin shops in
small towns, there's a recession on and a lot of them are hard up for
business. Circulated coins aren't a big seller to begin with, so the
deals can be quite impressive.

I just snagged $8.85 face in SLQs and Mercs for $20 on today's trip.