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 Replies: 26 / Views: 7,132 |
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New Member
United States
44 Posts |
Hello All!
Ok, little confused still after reading a number of previous posts about melt and spot.
I want to sell 1 $5 commemorative gold coin..as an example....
So a coin as such is rated at $296.93. (1228x.2418 of gold. But wouldn't a person also suggest to then multiply the finess of the gold too to get melt value? If so then the coin is worth $267.37 (1228×.2418×.900)
My confusion is what do I get if I sell to another person?
The $296 or $267 or something else. I have a bunch ave circulated gold coins like sovs francs and us comm....These coins do not have numismatic value obviously, so should I consider a melt value of $267 as of right now, or $296.... and when spot moves,the coins price moves obviously. ...thanks
*** Moved by Staff to a more appropriate forum. ***
Edited by sandwich5027
02/14/2015 12:05 pm
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Rest in Peace
 United States
1380 Posts |
If I follow what you are doing, your figure of .2418 is already figuring the actual gold content, no need to further multiply by .9
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Pillar of the Community
United States
589 Posts |
Great question and here is what I found on the topic: https://goccf.com/t/80636Quote:
I have a bunch ave circulated gold coins like sovs francs and us comm....These coins do not have numismatic value obviously Unless your are selling to a LCS you should be able to get more than spot. Edited by johntookit
02/14/2015 12:37 pm
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New Member
 United States
44 Posts |
Interesting, then buying gold with a higher fineness or gold content, doesn't apply technically. So gold coins should be the cheapest way to collect gold for gold purposes, not collectability. This is good news to me!
Edited by sandwich5027
02/14/2015 12:58 pm
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New Member
United States
44 Posts |
I did read that post too and it was still unclear. Basically a gold coin, even as plain as sovs, francs etc. still might have a premium just for being a gold coin? So a gold sov at $1228 per t oz, is.2354 of a troy oz, which is $ 289. Should I expect to receive this amount, even though real melt value would be even less, at $265?
I just paid $294 yesterday for a sovereign and $302 for $5 us commemorative coin, So about $5 or so above the spot × weight.Ive been searching for good deals and I wanted to ensure I wasn't overpaying. When I do the melt value math the sovereign is $265, should I have paid $270, which is $5 over melt, not spot?
Edited by sandwich5027
02/14/2015 1:30 pm
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Pillar of the Community
United States
589 Posts |
Any coin, being an actual coin as opposed to a medal or fantasy piece, usually has a premium, unless damaged. Even the lowly ASE (which most see as bullion only) has a premium compared to standard silver rounds. Selling with the premium is harder, as you need to find the proper buyer. For example, look at ebay's recent sold listings (sure the best offers aren't much help): SovereignFrancYou need to remember those prices include shipping and eBay/Paypal fees, but a lot of them are decently above melt. Edited by Groszy
02/14/2015 2:18 pm
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Rest in Peace
United States
1380 Posts |
I'm not sure the distintion you are making between melt and spot values really exists. In most situations I've seen, they are interchangable terms.
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Valued Member
United States
274 Posts |
Sandwich, I think you are confusing the weight of the coin with the weight of the gold in the coin. The gold sovereign, for example, has .2354 ozt of gold. The actual coin is heavier than this, but only .2354 ozt of the coin is actual gold. The .2354 ozt has already taken fineness into account.
As for spot vs melt, they are nearly synonymous and the only real difference is in how people use the terms. Spot is the price of 1 ozt. Melt is usually for a specific amount that is in a specific coin. So, with spot at $1228, a gold sovereign would have a melt value of $289.
As for buying and selling, use the melt value of the coin as your baseline. Just like anything else, you want to buy as low as you can and sell as high as you can. Again, the melt value should provide you with the same baseline that everyone else is using. Each type of coin has a different premium over the melt value, though, so you might also want to get to know the different coins available so that you can make the most informed decisions.
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Bedrock of the Community
United States
11951 Posts |
I agree ..with jgfindring
That the terms spot and melt are not well defined.
And sometimes use to mean the same thing.
If I had to say what I think they mean.
Spot - The price of gold as posted on the stock exchange.
Melt - the amount of gold or PM in a item, coin, bar etc.
If you look at Krause world coin guide you can get the
AGW (actual gold weight) or ASW (actual silver weight).
For your $5.00 gold U.S. coin it shows .2418 AGW. That
tells you that no matter what other metals are in the coin, there is .2418oz of actual gold.
On other coins you mentioned (foreign gold), sometimes
you will see BV (bullion value) listed for coins in the lower grades. Meaning these coins trade based on the
spot price.
Knowing what the gold value of your coin is just the
starting point in determining the buy/sale price of
the coin.
When a dealer offers you a price on a coin, most times
he will be basing the price on the lowest price he can
re-sell the coin for. Either to another dealer or to a
smelter. Most dealers can not keep all the coins they
purchase from customers. They may not be able to wait for them to sold to "walk in customers". They may run out of cash.
Smelter will pay the dealer back of spot and so will other dealers. In my experience smelters will pay dealers 97% to 98% or less.
Dealers to dealer .. will be much less than that.
If you are paying only $5.00 over spot, I think you are getting a very good deal. I would be curious what the dealer
is paying for the same coin. To me it would be hard to keep a business going on so low a margin, unless they are buying back of spot at least 10%.
The most important thing a collector can learn is what a coin will sell for, so they can decide what is a good price
to buy the coin for. And understand that a dealer has a lot of overhead, so he will need to make a good profit to stay
in business.
I also like to know what a dealer will pay, so that when I am buying collections from individuals I know what to offer.
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New Member
United States
44 Posts |
I was under the impeession that $1228 troy ounce is for 24k gold only. Anything less than that is multiplied by its finess, ex, .917 for a sovereign. That's why I'm so confused about actual sell price. If the the finess doesn't matter on gold coins, why put higher gold content? If .900 was same as .989 or.999 mints would lose money, no? It would have to come into account somehow.
Edited by sandwich5027
02/14/2015 10:41 pm
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Pillar of the Community
United States
589 Posts |
Quote:
If the the finess doesn't matter on gold coins, why put higher gold content? If .900 was same as .989 or.999 mints would lose money, no? It would have to come into account somehow. Let me try to simplify this for you. American Liberty and the American Buffalo, both have same about of gold. 1oz=31g or close to that. American Liberty is 916fine American Buffalo is 1000fine Liberty weighs almost 34 grams. Buffalo is 31.1 grams. |
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Rest in Peace
United States
1380 Posts |
To amplify on what John just said, if a coin is specified as a 1 ounce gold coin, it has 1 ounce of gold in it. If it is a lower fineness, the coin weighs more so you still have an ounce of gold. Bullion coin weights are always stated first as actual bullion weight, not actual coin weight
Edited by jgfindring
02/14/2015 11:12 pm
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Bedrock of the Community
United States
11951 Posts |
Just wanted to add. The finess of the gold does not matter, as far as
how much gold there. The prices are figured based on how much gold
there is, after the coin would be smelted. To get your melt price.
If you refined a 1oz gold eagle, there would be 1oz of 24k gold left,
after separating the other metals.
No one is saying that different finess of gold have the same value.
The figures are based on how much gold is actually in the coin.
If you start out with 1oz of gold, mixed it with a little amount of
other metal (copper) to make it harder, you still have 1oz of gold.
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New Member
United States
44 Posts |
Oh, so it all starts as 24k gold in coins and as you add other metals to the coin, the k would drop to a lower level? So a sovereign would then become 22k, (917) but after you melt it, it still becomes .2354 of actual gold, which would be 24k? I see I see.....
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Pillar of the Community
United States
4592 Posts |
The term you will see is "agw" (Actual Gold Weight). A "1 ounce, .900 fine" item either has
* 1 ounce of gold and so it weighs 1/900 or 1.111 ounces
Or
* 1 ounce and has .9 ounce of gold.
So you need to be a little careful reading what you are buying (selling).
With .999 or .9999 fine, the difference is so miniscule nobody cares.
-----Burton 50+ year / Life / Emeritus ANA member (joined 12/1/1973) Life member: Numismatics International, CONECA Member: TNA, FtWCC, NETCC, EveryCountry (online) coin club Owned by three cats and a wife of 40+ years (joined 1983) Author: 3rd Edition of the Sample Slabs book, https://www.sampleslabs.info/ |
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Pillar of the Community
United States
1796 Posts |
Your first option is incorrect. "1oz .900 fine" indicates 1oz total weight, 90.0% of that weight being gold. (If it's .999 fine, that corresponds to 99.9%, etc.; it indicates permill -- i.e. parts per thousand by weight)
Interpreting that description otherwise would be mistaken.
Edited by SteveCaruso
02/15/2015 10:17 pm
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Replies: 26 / Views: 7,132 |
Posted 02/14/2015 12:27 pm
