Numismatic Coins:
Numismatic coins are valued on their collector value rather than the intrinsic value of the metal weight. The coins are predominantly coins that were minted for use as currency. Due to the fact that many of these coins were used as intended, the remaining supply of coins that exist in a virtually pristine condition is very small. This small supply of coins is sought by the many worldwide collectors which establishes a classic supply/demand scenario.
Unlike bullion coins, numismatic coins are not valued based on the amount of the precious metal contained but solely on the price that a willing buyer will pay for the coin in a open competitive bid system. This is much like the art market where paintings sell to the highest bidder; however, the rare coin market is more highly organized with established prices for coins that are independently published on a weekly basis, in addition to having a worldwide computerized bidding network called the Certified Coin Exchange (CCE).
The coins are priced based on their individual characteristics, such as date, mint mark (the city where it was minted), type (such as one cent pieces, nickels, dimes, quarters, etc.), metal (copper, nickel, silver or gold), rarity and condition. Numismatic coins can be sold either by auction or through the wholesale network. The table below provides a vivid example of value differences for a one ounce American Eagle bullion coin (based on spot price of gold of
$1388.60) and a 1913 $20 St. Gaudens (also containing approximately one ounce of gold).
Coin
Date Composition
Condition Population
Price 5/25/16
American Eagle All
91.67% Gold Any
3.6 Million $ 1499.00
$20 St. Gaudens 1913 90.00% Gold
MS64
71
$ 6250.00
$20 St. Gaudens 1913 90.00% Gold
MS65
4
$63000.00
Notice the significant increase in price for the $20 St.Gaudens with a 1
point increase in the grade from MS64 to MS65
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