Ever since the beginning of history, gold has been a standard of wealth, purchasing power, and stability. Pharaohs were entombed with it to make certain that they were prepared for what ever happened on the other side.
DEFINING SPOT PRICE
definition one: The spot price for precious metals (a commodity) is the price that is quoted for immediate (spot) settlement and for the terms of payment and estimated delivery.
defintion two: The present delivery price of a given commodity being traded on the spot market. also called cash price.
HOW ARE SPOT PRICES DETERMINED?
The simple answer is that the markets determine the prices through the interaction of pure supply and demand.
In the case of the specific case of gold, the major market is the London Bullion Market Association (L.B.M.A.). Most of the members are major international banks or bullion dealers and refiners. Five members of the L.B.M.A. meet twice daily to "fix" the gold price in a process known as the London Gold Fixing. This is an alternate mechanism of price discovery which is designed to allow gold traders to trade at a fair market price. It is designed to fix a price for settling contracts between members of the London bullion market, but informally the Gold Fixing provides a recognized rate that is used as a benchmark for pricing the majority of gold products and derivatives throughout the world's markets. The Gold Fixing is conducted by telephone, at 10:30 GMT and 15:00 GMT.
Clients place orders with the dealing rooms of fixing members, who sum up all orders before communicating their interest to their representative at the fixing. The metal price is then adjusted to reflect whether there are more buyers or sellers at a given price until such time as supply and demand is seen to be balanced. Throughout the proceedings customers may change their orders, at which point the fixing member will raise a small flag to visually convey to the other members that they are changing their order. The price cannot be 'fixed' while a flag is raised.
Contracts for the future prices of gold, silver and other precious metals are traded on commodity exchanges around the world. Specifically, gold is also traded as a security on the London, New York, Johannesburg and Australian Stock Exchanges.
INFORMATION CONCERNING PRE-1965 U.S. SILVER COINS
A ** BAG ** of pre 1964, 90% percent, junk silver coin contains $1,000 dollars face value of dimes, quarters, and/or half dollars. Solid half dollar bags may be at a premium due to their popularity - especially Kennedy half dollars. Actual coin silver content for coins in average circulated condition is 715 to 720 net troy ounces of .999 fine silver if refined.
And more: What exactly is a "bag" of U.S. 90% silver coins? A bag is a commodity contract $1,000 face value volume of 1964 and earlier LEGAL TENDER U.S. silver coins whose weight and content was guaranteed by the U.S. Government. It may be comprised of all one denomination or a combination of dimes, quarters, and/or half dollars each with a .900 fineness of silver content.
IS THIS A COST EFFECTIVE WAY TO BUY SILVER?
WHY? Take the $1,000 face value bag cost and divide by 715oz.(net .999 silver weight) = your cost per ounce. Example: a cost of $21,230.00 divided by 715 = $29.69 per oz., with a silver spot basis of $26.93 THIS IS ONLY $2.76 PER OUNCE OVER THE SPOT PRICE OF SILVER for LEGAL TENDER COINAGE - a much better value than the American silver eagle coin! We recommend loading up at current price levels. Take advantage of the low premiums for pre-1965 90% silver coins now. You can save with MJPM pricing and enjoy convenient, direct phone line personal service!
WHY BUYING 90% JUNK SILVER COIN MAKES GOOD SENSE
Pre 1964 U.S. 90 percent junk silver coins are the dimes, quarters and half dollars that circulated in America prior to 1964. These coins are legal tender and guaranteed for their content and purity by the U.S. Treasury, additionally, everybody knows what their denominations represent. With a quick visit to our MJPM website to check out our buy/sell rates for 90% silver coins you're in business. Can you think of an easier way to buy food, clothing, gasoline and other necessities in difficult times?
WHAT ABOUT RARE COINS AND PAPER MONEY?Rare coins and paper money have an excellent track record of growth performance and have traditionally led the pack of all hard-asset investments. Rare coins and paper money are a world-wide recognized collectible and an important part of America's heritage. The classic market scenario of demand versus availability plays an enormous role in the success and popularity of all rare coins. Within the U.S. rare coin market, coin types such as Pre 1933 U.S. Gold coins are not subject to government regulation making them a popular series for both collector's and investor's. *Note: for a rare coin to be considered "a collectible" it must have a value of more than 15% over its intrinsic value.
Why should I buy only certified rare coins and paper money?By purchasing only certified specimens by widely recognized companies such as the Professional Coin Grading Service (PCGS tm) or the Numismatic Guaranty Corporation (NGC tm), you are protected from counterfeiting or overgrading (the exaggeration of an items state of preservation). Each corporation GUARANTEES both the authenticity AND grade (physical state of preservation) of every item they encapsulate. With the advent of the certified grading services, one may confidently take advantage of the exciting and historical world of rare coins and currency!
By purchasing only certified coins and currency, you eliminate having to deal with expensive portfolio appraisals or to be left wondering if your investments are correctly graded. Certification will be a terrific aid in realizing the full return value of your investments at the time of liquidation. And finally, PCGS and NGC certified coins and paper money offer sight and unseen liquidity! With a simple phone call, one may sell their holdings and have a bankwire that same day!
Collectible rare coins and paper money carry the same mentality that applies to other investment collectibles, that is, "BUY THE BEST QUALITY YOU CAN AFFORD!" Rarity coupled with quality is precisely how value is determined. Keep these factors in mind and your coins will do well for you!
Understanding Rare Coin and Paper Money GradingThe Rare Coin and Paper Money certification services, such as the Professional Coin Grading Service PCGS (tm), or the Numismatic Guaranty Corporation NGC (tm), guarantee the authenticity AND condition of every item they encapsulate! Please take our advise on this important topic, LEAVE THE GRADING TO THE INDUSTRY EXPERTS. Another bonus, your investments are neatly hermetically sealed in a convenient "slab" plastic holder allowing the fun of handling those rarities!
Coin grading for our MJPM InventoryCoins offered in our MJPM Inc. listings are either uncertified (RAW), or have been certified and placed (slabbed) into a protective, hermetically sealed plastic holder and graded by a professional service such as PCGS, NGC, or ANACS.
Understanding Coin Grading Notation!
Numerical Grading SystemThe use of Dr. Sheldons numbering system for grading coins has become the accepted technique by both professional numismatists and collectors. Dr. Sheldons system was originally devised and intended to aid the Early Copper Collectors of America club members to have an evaluation system for communicating an accurate state of preservation for any particular copper cent. The system proved to be a huge success and was quickly adopted by the hobby and importantly, the third party certified grading services. Dr. Sheldons numeric system has been very successful in providing the hobbyist and investor with a method to both evaluate and communicate specific condition.
More on SheldonDr. Sheldons numbering system begins with Basal State 1 which represents the extremely well worn condition and MS70 representing a perfect coin.
Scale example Basal State 1 thru Mint State (MS) 70
"Split Hair Grading"The American Numismatic Association adopted Mr. Sheldon's numeric system as follows: first assign a number to each circulated coins grade. For example: AG (3); G (4); VG (8); F (12); VF (20); XF (40); AU (50). Occasionally, MJPM Inc. will list a premium circulated coin with a number, indicating the precise place the grader thinks it belongs within its category. XF-45, F-15, AU 58 are examples one will see within our listings.
Mint State: coins are graded MS 60 to MS 70. The higher the MS numbers in the grade field, the higher the coins overall quality. A premium MS coin may be indicated by a + such as MS 61+. Such a coin is better than average for its grade but does not approach the next higher grade.
CH = Choice: A coin listed by MJPM as CH AU, would be interpreted for example, as a coin that is AU in grade but has the looks and/or eye appeal that is more desireable than other coins of the same grade.
PQ = Premium Quality: A coin above average for its grade...usually associated with incredible eye appeal or mint luster for that coin. A coin graded MS 65 PQ would be a coin with such an exceptional strike, look (or eye appeal) and lack of blemishes...just not quite the MS 66 grade but bordering it!
DMPL, DMP, or PL.: These abbreviations stand for Deep Mirror Proof-Like, Deep Mirror Proof, or Proof-Like. They are used with a coin that is not a proof striking, however, it resembles one.
Two grades separated by a slash (/) indicate a grading difference in the coins obverse (head) and reverse (tail). The first grade always represents the obverse and the second grade always represents the reverse. Example, a coin graded VF/XF indicates a coin with a VF obverse and an XF reverse. Two grades separated by a hyphen (-), such as G-VG indicate both obverse and reverse are of a quality midway between the lower (G) and upper (VG) grade.
Is a rare coin/paper money portfolio expensive?This question may best be answered by identifying the following considerations:
RarityRarity, or specifically the "surviving" population of any particular collectible is a critical factor for a rare coin investment. For example, the 1804 U.S. Draped Bust gold eagle has a mintage of only 3,757 coins, you can imagine how rare this lovely early U.S. gold eagle is in the MS63 condition or higher (and what a terrific investment it is)!
Rarity coupled with condition are paramount to the performance AND financial reward/return of any rare coin and/or rare paper money investment. The acquisition of rare top quality specimens require patience and good market timing.
ConditionI can not reiterate enough the importance of condition (the state of preservation) for rare coin and paper money investments and how it relates to their value. The importance of purchasing only high states of physical preservation can not be emphasized enough. Factoring in population considerations, i.e., only a few specimens survive (due to low mintage, circulation (physical wear), with other factors, one quickly narrows the market of availability (just think in terms of the 1918 Pittman act where millions of silver coins were melted down).
A Brief DiscussionThe success of any portfolio relies upon on a solid foundation of knowledge of the investment medium. One very fundamental understanding one should consider prior to investing into a coin porfolio should be; do I want to invest myself into "high quality GENERIC numismatic coins" or "high quality RARE numismatic coins?"
The key words here are #1. high quality #2. GENERIC #3. RARE. At MJPM we feel there is no question that each and every investment should be of the "highest quality" that one can afford. Secondly, knowing there is a very distinct difference between "generic" coins and "rare" coins! MJPM's definition for "generic" coins...def; common date and mints with abundant availability. "Rare coins" on the other hand are most often have extremely low production numbers and have proven track records of rare availability in the market place.
Portfolio performanceBy understanding the key factors to successful rare coin investments as being determined by condition and surviving population, one may ascertain an entry point. Rare coins offer a wide array of opportunities that can meet financial expectations, artistical beauty, historical significance, and be an investment that provides a lot of fun, i.e., making the acquisition, and of course, enjoying that new acquisition!
Collectible rare coins and paper money can provide years of pleasure in both the financial expectations of a well organized portfolio and their historical beauty.
Getting started is easy!Call MJPM today and ask for Michael! He has placed millions of dollars of terrific rare coins and currency with clients, celebrities, family and friends since 1984. Put Michaels experience to work for you with rare coin and/or rare currency selections that have made MJPM a name for quality and profit.
THE HOLDING PERIOD!Historically, few coins have appreciated dramatically in the short term. Purchasers should recognize that it may well be necessary for them to hold their coins for 5 or more years, and possibly even 10 years or longer, to realize any possibility of a profit.
Coins can be a lot of fun and an investment that can prove to be very rewarding in more ways than one! Enjoy the fun and exciting world of numismatics!
THE RISK!The purchase of rare coins, currency, or precious metals can be highly speculative, and may involve substantial risk. As in other markets, prices can be extremely volatile and erratically fluctuate depending upon market conditions. Before purchasing coins, one should be aware of the potential risk and have a financial comfort zone for protection against any potential significant loss. Simply stated, you buy and sell rare coins at your own risk!
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