I've been building my stack for a few months and learning as I go along. Really just adding various junk coins here and there based on spot silver pricing and weights and such to determine if I'm getting a fair deal or not... Every so often I'll run into someone pricing their items via "XXX x Face Value" such as "Asking 26x Face Value" or whatever they're asking... sometimes they'll give a breakdown of the coins involved in the total, other times they may not. Can someone point me to somewhere I can learn more about how to understand how this kind of pricing works (on an easy to understand level) or can explain it to me? The few discussions I've seen here at CT, it seems as if the various ratios for what's a good number to pay depends on what type of coin you're looking at - while 10x face might be good for a dime, for example (number chosen randomly, I have no idea if it's accurate), it might not be a good number if you were buying quarters... Just looking to understand another aspect of this arena so I don't have to just skip over any kind of transaction involving this kind of pricing.... Thanks!
www.coinflation.com All US junk silver has about .73 ounces of silver per $1 face value when its struck. Therefor, 10 dimes, 4 quarters, and 2 halves all have the same amount of silver. X Face value is simply an easy was to express pricing of all these denominations at the same time. Silver dollars are different, having about .78 ounces per. Part of the reason they sell for premiums, the other part is collectors love them.
26x means that you must pay 26 times the face value. $26 cash = $1 face value of 90% silver coins. Half dollars, quarters, and dimes are all proportional in weight to their face value, so 5 dimes weighs the same as 2 quarters, or 1 half dollar, etc. Morgan and Peace dollars do not follow the same pattern and actually have a little more silver. when the price is "26x" $26 = 2 half dollars OR 4 quarters OR 10 dimes.
Also, be wary of dealers on eBay that make it sound like you're getting an oz of silver metal if you buy an oz of junk silver coinage. An oz of junk silver coinage is of course only equal to 9/10ths of an oz of metal. How did that pick-up the other day turn out for you Rassi?
Not to mention they usually weigh their "ounce" as 28.35g not a troy oz of 31.1g, so you really only are getting about .81ozt of actual silver.
The previous posts give a good explanation of the face-value-multiplier pricing pattern. One other thing to keep in mind: heavily-worn coins lose weight -- the metal is actually worn off, not just flattened out. This weight loss is more pronounced for smaller coins. A roll of 50 slick dimes (say, poor to AG Barbers) might weigh 10-20% less than a roll of BU dimes, even though they were minted at the same weight. A roll of dateless SLQs or Barber quarters might weigh 10% less than a roll of BU Washingtons, and a roll of fair-AG Barber or Walker halves might weigh 5-7% less than a roll of 1964 Kennedys. Now, as long as you can sell your silver under the same face-value-multiple approach, you're fine. But if you buy old, smooth dimes by FV, then sell them by weight, you'll lose money. Conversely, if you can buy older stuff by weight, then sell by FV, you can come out ahead. Some buyers and sellers go by FV, but reject excessively worn coins. Nearly all FV buyers reject holed coins. Even though the hole reduces the weight of the coin by only 1-2%, you can expect to get maybe half the normal price for it. Barber coins tend to hold a higher premium than other coins, even if they're heavily worn. If you can buy them at the same FV multiple as junk, do it. Try not to sell them as junk. If you could buy worn Barbers based on their silver weight, it could be a big win; I've never seen them sold that way, though.
If you look at "coinflation.com" you'll see where they have broken down the silver content in various coins. Based on the ratio of silver to non-silver content, and the fact that silver (base metal) is hovering around $31 an ounce, the cost of the "melt value" for the so-called junk coins runs around $25. A quarter has 2.5 times as much silver as a dime, a half-dollar has 2x the silver of a quarter, and so on. So it's a really easy calculation to make. I was at a coin show this past weekend (my first!) and saw one seller with $50 bags of coins. He was actually selling for $24 x face, or $1200 per bag. Before going to the show I head read a number of topics on this board and understood that the going rate around now is $25 x face, so $24 x face seemed to be a good deal. I didn't have $1200 to spend or I might have bought a bag.
This used to be absolutely true, but in the last few years I see barbers dropping down to FV, and not even that desirable FV items. At least around here, almost all junk dealers have barbers in their junk pile at no premiums, and many times buyers preferring washinton quarters and kennedy halves over them do to barbers being lighter in weight. Its kind of sad these cool coins are now reduced to junk value.
I was able to go thru the info on Coinflation the other day and make myself a "cheat sheet" for ebay and other junk silver offers where I can plug in the number of coins at a certain type level, the current spot silver price and it'll tell me the value of the group based on their metal content (silver only). I noticed the point about the random lots of silver coins in groups of ounces of coins on ebay - easy to fall for that one, both the "standard" ounces vs. troy ounces as well as the ones that throw in a lot of war nickels to fill up a lot of the weight with non-silver content. I quickly started avoiding even looking at those auctions altogether, but when I do bother looking at them, I have a pricing cheat-sheet that shows me relative price-points for both "standard" ounces and troy ounces. So I know how to easily check to see if a deal is a fair one or not if someone, for example tells me they want, $300 for 25 Franklin halves. I know spot silver is currently about $31.78, each Franklin has 0.3617 troy silver in it, so that's 9.0425 oz troy, or $287.37 roughly... so on silver content alone, they're a tad high.... Is there a similar "formula" I can use for "face-value" pricing???
Formula would be .715 X FV = Troy oz. So .715 X $1.70 would be 1.2155 Troy oz. I see .715 being used to account for a small silver loss due to wear. Obviously slicks would be less, and silver dollars a little more.
Don't forget to discount lower-silver-content types. 40% halves and 35% war nickels trade below the prices listed on Coinflation. Sterling tends to be discounted pretty heavily as well. Don't know about Canadian 80% coinage, but you'd probably have a hard time getting full value for it down here in the States.
http://www.silvercoinstoday.com/silver-calculators/us-silver-coin-calculator/ Try this. Is what you just described but lets you take in even war nickels and 1 oz bullion.
This is essentially what my Excel spreadsheet I created does for me....I just don't have to rely on a website for it....
I always buy them when I see them - even slick. I would rather have them over the alternative - even if the desire of the general public is fickle
I was able to pick up a bunch of Barber dimes at FV a couple of months ago. I like having anything that might pop over it's silver melt value eventually. I bought a bunch of JFK's, Wash. qtrs and Merc. dimes a week and a half ago at 21.75 x face, but I think a good price now might be around 22-24x face value. 24x face seems to be a pretty average price nowadays. That means a silver half is going for $12, which is a good price for it. Dimes are around $2.40 each and quarters are six bucks.
I picked up a 1932 Washington quarter at the coin show I attended for $6.50, and it wasn't in bad shape. Basically got it because it's the first one and it was cheap and not much over the melt value.
I think that's a good buy. I got an individual quarter for $6.50 at a flea market and I felt like that is a pretty good price nowadays. I also picked up 11 quarters for $60, which is about $5.45 a piece, which is a really good deal. You are only going to get that kind of deal when you buy a bunch of them.
I've been on a silver proof state quarter buying spree lately. I've been paying about $7 each for those. I think it will be nice to have a roll or two of these put away. They are full weight silver and of course are proof coins so no wear and practically perfect every time. I know that's a steep premium but I also feel like I'm young enough to where that won't matter. I easily see much higher silver prices at some point in the future the demand is growing too quick and the supply seems on the short side.
