junk silver... when is it a good deal?

what percentage or cents/dollars over should one paid for junk silver?

I got 4 franklin halves for $23.00 earlier today and figuring out the silver concent value I paid $14.338 per ounce

2 of them are in fairly good condition I would call one XF and the other one XF-AU

and 1 had a slight green toning on the top of the I B in LIBERTY

so how did I do and like I asked above what's a good price to pay for junk silver and when does the price get too high?

 

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When u pay spot or less

 

I'm a buyer at pretty much anything below spot, if the coin is in G or VF then a larger % below spot since some of the metal is worn off. Usually dealers talk in terms of X above face value.

 

ok so what's sweet spot of X times face value?

10x face value?
11x face value?
23x face value? j/k

 

I'm not in a rush so for me it's 9-10X face value.

 

10x -11x is usual

 

Right now if I was buying I'd think 10x face shipped to me would be fair. But when I'm buying I try to get the older stuff, Merc Dimes instead of Roosevelts, Walkers instead of Franklins or Kennedys. Just more fun to go through them when they are old. But I'll buy the newer stuff occasionally.

 

Ditto on the older stuff.

 

Well, here's a good link to keep up with the current melt value of silver coins, and it updates daily:
http://www.coinflation.com/silver_coin_values.html

 

how is 11.50 x face value?

 

it really depends on why you want junk silver vs. bullion. 11.5X is more than fair and a pretty good deal if you are buying from a dealer. If you are just accumulating it as a collector/silver investor I would try to get it closer to 10X.

 

It is possible to get too hung up on spot prices for a couple of reasons. Someone buying for 10% above spot when silver is $14 is getting a better deal than someone buying for 10% below spot when silver is $19, but most people don't see it that way. Also, when silver is $30, you're going to kick yourself for not buying now at 10X and waiting for that 9X price that might never come.

Don't sweat the small stuff.

 

how bout saying screw it all and getting it for 11.5x?

 

The way I look at it, the lower you buy below $20 the better, regardless of the spot price. I use $20 as a benchmark because it is the lowest price that I can see as being a sustainable long term low price. When $20 becomes the floor, the number of ounces you own will be more important that whether you paid 9X or 11X spot.

I understand that this way of thinking will be unsatisfactory for most people.:kewl:

 

I think this way of thinking is perfectly logical. That is assuming that the price of silver goes over $20. You could argue that there is no reason for it to be at it's current levels and it really should have gone to $30 years ago.

 

I would agree, there is no reason. Silver inventories have been dropping for many years. There is a lot less silver around now than in 1980 when it spiked to $50, and demand by industry is much larger.

How many other items are there that have shrinking supplies and rising demand but no significant price rise to balance supply and demand? How many things can you purchase today for a price that is lower than it was during the 1970s when it was more plentiful? The silver situation is unique, and can probably be resolved only by higher prices.

-- all just my opinion of course.

 

??? who said 9x -11x spot price? I thought we were talking about 9x 11x face value I think it's better to pay the lower x face value to gather more silver around for those people out there that don't have as much money as us others do

I mean that is 50 cents more per 2 silver quarters you have to get more silver quarters

10 quarters at 11x is 27.50
or
12 quarters at 9x is 27.00

I like the lower one for the hoarding factor
btw
(serious question) anyone know where I can get for 9x face value or less?

 

I think it was a typo

 

I am curious how you came to your figure. You paid closer to $15.89/ozt for the "junk" silver. Still, I would consider this an acceptable principle for a long term investment, regardless of the current spot price.

Generally, when purchasing "junk" silver, the coins involved should, for the most part, be about good or better quality, yet not to be expected better than VF. In this condition, a small portion of the silver has worn away, and thus, you may end up with a percentage smaller of the silver content. This would become quite noticeable in dealing with larger bulk "junk" trades in the face value in the thousands.

So, the $15.89 figure would be the least you paid per ounce troy (with more worn coins, the price per ounce troy is greater due to the lesser silver content per coin.)

Now, in converting the silver content (and price per ozt per coin) it is best to work the mathematics in troy grain (or simply grain). There are 7000 grain per avoirdupois pound (that is, the pound we use in our normal day to day measurements), and 5760 grain per troy pound (that is, the pound used in measuring the weights of precious metals. In the avoirdupois pound, we have 16 ounces, and thus, 7000/16 grains per ounce, or 437.5 grain per avoirdupois ounce (oz). On the other hand, there are only 12 ounces per pound troy. Thus there are 5760/12 grains (or 480 grains) per ounce troy (ozt). So, the troy ounce is greater than the avoirdupois ounce, but the troy pound is less than an avoirdupois pound.

As you can see, it is very important to understand the measurement being used (avoirdupois or troy) when dealing in "junk" metals by the ounce or pound.

Now, taking your Franklin halves as the example, each has a specification of 12.5 grams. In accordance with the International System of Units, the conversion factor from grams to grains is 64.79891 milligram per grain (.06479891 grams). Thus, the specification for the half dollar is approximately 192.9045 grains (12.5gr/.06479891gr/grain). Being that the silver content is only 90%, we multiply by 0.9 (192.9045 x 0.9) and get 173.6141 grains of silver per $0.50 of 90% silver coin.

To convert this to ounces troy, we simply divide this by the weight of 1ozt in grains, which is 480 grains (173.6141grain/480grain/ozt) and we get approximately 0.3617ozt silver content per 90% silver half dollar.

Since there are four of them, we multiply: 0.3617 x 4 = 1.4468ozt for $23. So, we divide the $23 by the silver weight and get: $23/1.4468ozt = $15.89ozt for you purchase. The more worn the coin (especially with half dollars and dollars) the higher the actual price is.

Like I said, even at $15.89/ozt, you still did a fair job, regardless of the current spot price. That is, provided you purchased the "junk" for long term investment, and not short term or speculation. With the market as it is currently, I would place the buy limit at $16.28 for long term investment. There is the opportunity to be able to make a quaint 5% return over the next year with the expectation that silver will hit up to $19/ozt over the next year, and the silver is sold within the right time frame.

Playing the game of percent this side or that side of spot is a speculator sport. Realistically, one should not play such games without a proper understanding of the market, much like playing the stock game.

 

yea I guess I figured wrong a bit it was quick math I did while talking to my wife
sorry
but here's how I figured it and I wasn't going for troy or using grains sorry if that's not good enough for some but it is a ruff estimate
I did weight them by the way and they totaled at 50.0 grams so I assume they weren't worn out too much to lose alot of silver

12.5 grams X.9 = 11.25 grams / 28.349 = 0.3968 content times 4 of them is 1.5872 oz silver and divivded that by the $23.00 I spent
which is $14.49