Silver dropped below the $16 level and some are thinking of buying some silver. There are some main options buyers have other than the image on the coin. The first decision to be made is whether one should invest in coins or rounds or bullion bar.
When I bought my first piece of silver, I had this same conundrum. As I found that official country coins cost more than rounds or bullion, so what is the reason. Coins are minted under a country’s specification where as rounds or bullion are minted by a private concern. In most cases, if you select a well respected coin dealer there is a minimal chance that you won’t receive the round as advertised but when buying from say an auction site, you do expose yourself to a higher risk.
Since coins are more well known than rounds people are more willing to trade using them. People are more comfortable when dealing in a piece that they are familiar with. Some coins also command a numismatic value for various reasons like the age or in some cases there is a flaw when the coin was minted. The definition of the details on the coin also have a bearing on its numismatic value. These are some of the main reasons that a coin sells at a premium to rounds or bullion.
I repeatedly mentioned rounds and bullion. Rounds are just bullion that a shaped as a circle where as bullion (in my usage) refers to silver shaped as rectangles, some refer to these as ingots.
The amount of silver contained in the Silver Eagle is 1 troy ounce and its purity is .999 fine silver. Rounds can be bought in differing weights and differing purity. The most common purity is .999 or .9999, there is a small increase in value for the .9999 purity over the .999.
There is a difference other than general acceptance between coins and rounds. The Silver Eagle is considered legal tender in the US, rounds are not. But in regards to the Eagle, it has a face value which is much smaller than its melt value. Currently the melt value is about $16 where as the face value is $1. While on this subject, the same applies to silver half dollars, silver quarters and silver dimes, if you are fortunate to have any of these. These coins mostly went out of circulation sometime in the 1960s and they are very hard to find in circulation. The coins date after about 1964 contain no silver.
The choice you decide on primarily depends on personal preference. Some points that you might want to research…
The popularity of a coin or round, this will tend to increase the value. For whatever reason some designs are sought by people which raises the demand for that particular piece which in turn causes the price to rise.
The reliability and past history of the company you deal with. This is very important, there has been several reports where buyers were scammed by coin dealers. Some of these scams were non delivery and the product received was determined to be gold plated tungsten. These buyers may have some recourse but it is easier to do your research before you buy. Researching a company’s history might include how long have they been in operation, any complaints file against them and blogs that may exist. Personally, I would that blogs or opinions with a grain of salt as blogger are not always truthful but if many are saying that the company has scammed they, it would be easier to find another dealer.