How Price Of Silver Affects Coins Value

I would be very interested in seeing an analysis of selling price of silver coins that are well above bullion value, yet are not true rarities, as a function of bullion value.

I doubt such a thing is available.

ebay would probably be the best source of such info, but it would require someone compiling it on a regular basis.

As for the original question, my hunch is that it makes no sense to hold onto coins that would sell for, say 5 to 10 times bullion value. As suggested by basebal21, sell them and put the proceeds in something reliable.

"...my hunch is that it makes no sense to hold onto coins that would sell for, say 5 to 10 times bullion value."


Do you mean "5 to 10 times bullion value NOW, because that ratio will not continue to be that high as the bullion value goes up" ?

In your original post you said you noticed some common Barber quarters that sell at 9X bullion and Barber dimes that sell at 4X bullion. I think many would say this is an indicator these coins are selling based on numismatic value.

Since no facts have been presented on how this ratio changes as bullion value moves, I am guessing that ratio either moves very slowly, or is just as likely to move in relation to things other than bullion value.

Another way of saying this is that the best indicator of current numismatic value is the recent numismatic value, and not the bullion value, when an item is selling at many multiples of bullion. If that's a good assumption (and to be clear, that's all that it is), the answer to your specific question that I've copied is "it doesn't matter most of the time."

If you bought when silver was at $6, you've been holding these for over 14 years. I don't follow precious metal prices on a regular basis, but if I look at historical trends for silver, the last time silver had a sustained upward movement was over 8 years ago. If it were me, I would not be expecting an updraft in silver price, and I would not hesitate to start selling based on bullion considerations.

Some of the posters here will know I am fond of statistics. That's one way to test the question/hypothesis here (which silver coins' prices are affected by bullion prices?).

On another thread, we looked at some statistics on auction sales for various U.S. coins. So I will use a similar approach here, again drawing from this database:https://www.PCGS.com/auctionprices.

First, we need to identify periods with different bullion prices. I looked over the last 10 years, and chose these periods with non-overlapping, and fairly consistent bullion prices (the "high" period is non-overlapping but not so consistent):

"Low" Bullion Price: Silver was at $16-17/oz.most days between 5/1/2017 and 5/31/2018

"Medium" Bullion Price: Silver was at $19.5 to $22/oz. most days between 7/1/2013 and 7/31/2014.

"High" Bullion Price: Silver was over $30/oz. most days between 2/1/2011 and 4/30/2012.
https://www.apmex.com/spotprices/silver-prices.

For a silver coin that sells at a small multiple of bullion value, I chose the 1881S Morgan in MS62, since this is the Morgan with the most data in the PCGS database. For a silver coin that sells at a high multiple of bullion, I chose the I chose the 1891CC Morgan in MS63, which was examined on the other thread.

Here is what I found for the median selling price at auction during the various periods:

1881S Morgan MS62
"Low" bullion price period: $44
"Medium" bullion period: $47 (7% higher than low bullion)
"High" bullion period: $51 (16% higher than low bullion)

1891CC Morgan MS63
"Low" bullion price period: $660
"Medium" bullion period: $676 (2.5% higher than low bullion)
"High" bullion period: $604 (8.4% lower than low bullion)

From this very limited analysis, the hypothesis that low value silver coins are more closely tied to bullion prices is supported. But I would emphasize the "very limited" qualifier.

"prices spiked during that period and have corrected over the last five years"

Both coin and bullion prices went down more or less together, then?

@MikeF, I took a look at the two SLDs with the highest population in that database: 1871 and 1860-S.
My analyses for the low, medium and high bullion periods I used earlier agrees with your conclusions. I also went back a bit in time before the "spike" in silver prices, picking a period that was comparable in silver price to the more recent "low" period. The dynamics at the two price points are a little different

For the 1871 I looked at XF40-45:
Low bullion (5/17 to 5/18), median selling price was $444
Med bullion (7/13 to 7/14), median selling price $505
High bullion (2/11 to 4/12), median selling price $518
Low Bullion (1/08 to 6/10), median selling price $374
This coin at this grade looks like it moved in tandem with the upswing in silver price, then dropped back down. The 2008-2010 number is depressed a bit by a handful of NGS graded coins that all fell at the low end ($250-350). Without them, the median would be more like $400

For the 1860-S there are more higher graded coins in the database, so I looked at MS62:
Low bullion (5/17 to 5/18), median selling price $1870
Med bullion (7/13 to 7/14), median selling price $2230
HIgh bullion (2/11 to 4/12), median selling price $2300
Low bullion (1/08 to 6/10), median selling price $2300
So, this higher value coin took off when Silver passed about $10/oz, plateaued for about 6 years regardless of silver price, then dropped recently.

That's still only 4 coin/grade combinations, but suggests the picture is much more complicated than "low value coins move with bullion price and higher value coins don't."

Absolutely agree that coins selling more on "numismatic value" will have price moving due to supply-demand balance.

There is also the annoying possibility (from an analysis viewpoint) that increased bullion price also increases demand ... which is what perhaps happened during the last bubble.