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- US Circulated Silver Coin Melt Values
Determining the current price of silver coins is a straightforward process once you know the silver content of the coin and the current market price, often referred to as the silver spot price.
Calculating Melt Value
Coin melt value refers to the intrinsic value of the precious metal contained within a coin. It's the value that a coin would have if it were melted down to recover the metal. The melt value is primarily determined by the metal's weight and purity, and is calculated based on current market trading prices for the metal.
When dealing with circulated junk silver coins, most will be minted from an alloy that contains 90% pure silver. Others may have a specific weight and purity denoted on them. This high silver content gives them a significant intrinsic value based on the current spot price of silver.
Precious metals are measured in troy ounces. A troy ounce is different from the more common avoirdupois ounce that's used to measure most other goods in the U.S. There are roughly 28.35 grams in an avoirdupois ounce, but a troy ounce is roughly 31.1035 grams.
For example, consider a 1964 Kennedy half dollar was minted with 90% silver content and a gross weight of approximately 12.5 grams. To calculate the melt value of this coin, you simply multiply the silver weight times today's spot price. In this case, each 1964 Kennedy Half Dollar is minted with 0.3616959 troy ounces.
Collector Value
Beyond the silver content, pre-1965 silver coins may also have numismatic value for collectors. The melt value doesn't take into account the numismatic or collector value that a coin might have. Certain key dates, mint marks, or conditions can make some coins worth significantly more than their melt value. Collectible coins may be worth more than their melt value due to factors such as rarity, historical significance, condition, and demand from collectors. If you have questions about whether a coin has numismatic value you can visit a local coin shop in your area to receive an appraisal.
Precious metals like silver have historically been seen as a store of value and a hedge against inflation. This is because pre-1965 coins are made of silver, many investors and collectors view them as a tangible asset that can preserve wealth over time.
By understanding the melt value, buyers can ensure they are not paying excessively over the intrinsic value for precious metals, unless they deem other factors are worth the additional premium. Melt value calculations require accurate information about the piece's purity and weight. This can help you ensure that the precious metal you're buying is as advertised and not counterfeit.
If your primary goal is to invest in precious metals, knowing the melt value allows you to assess the potential for profit or loss in your investment. You can track the market price of the metal and make informed decisions about buying or selling based on changes in price.
When considering different forms of precious metals (e.g., coins vs. bars), knowing the melt value helps you compare them on an equal basis. For instance, you can compare the premium (the amount over melt value) you're paying for a coin to determine if it's a better or worse investment than a bar. Precious metals investors often track the melt value of their holdings to gauge the overall performance of their investment portfolio.
When selling, knowing the melt value of your stack is important because it will give you a reference point for the minimum value you should accept when receiving offers from dealers can help you negotiate a fair price.
Collector or numismatic coins derive much of their value from factors other than their melt value, such as rarity and historical significance. It's particularly important when dealing with bullion coins, which often don't carry numismatic value.
