A dealer's offer starts with two numbers: the metal value of each coin at today's spot price, and any collector premium the coin earns for its date, mint mark and grade. The dealer then subtracts a spread that covers the cost and risk of reselling it. At our appointments you see each of those steps on a written, item-by-item list.
The formula: metal value plus collector premium, minus the spread
Most offers follow the same arithmetic, even when a dealer never writes it down. Start with melt value, which is the weight of gold or silver in the coin multiplied by the live spot price. Add the collector premium, the amount buyers pay above melt for a scarce date, a sought-after mint mark or a high grade. Then subtract the dealer's spread, which pays for the cost and risk of selling the coin again.
A common-date Morgan dollar shows how the pieces fit. It holds 0.7734 troy oz of silver, so most of its price tracks the silver market, and the collector premium on top is small. An 1893-S Morgan sits at the far end of the same series. Its silver is a tiny share of what it sells for, and nearly the whole offer rests on grade and authenticity.
On a coin worth a great deal, the spread is usually a smaller share of the price than it is on a common coin. The dealer can earn a working margin on one sale, and buyers for high-end coins tend to know the market well, which keeps everyone's pricing close.
How today's spot price sets the metal side
Gold and silver trade on world commodity markets, and the spot price moves through the trading day. For bullion, pre-1965 silver coins and gold coins in ordinary grades, the metal side of an offer is tied to that live number. A fair dealer will tell you which spot price they used.
Weight comes next. Coins and gold jewelry go on a calibrated scale you can read yourself, and jewelry is sorted by karat first, since 14K holds 58.3% gold and 18K holds 75%. Pre-1965 dimes, quarters and halves are usually figured by face value, because $1 face of 90% silver coin holds about 0.715 troy oz of silver.
Gold coins work the same way. A $20 double eagle holds 0.9675 troy oz of gold, and an American Gold Eagle or Krugerrand holds one troy oz, so a worn example of any of them is priced close to its gold content. British Sovereigns and Mexican 50 pesos coins are figured from their own gold weights.
If spot moves sharply during a long appointment for a large collection, a dealer may update the metal figures. Ask which spot price the written offer used so you can check it against the market that day.
Price guides, wholesale sheets and auction results
Coins worth more than melt are priced against market records. Dealers check published price guides, dealer wholesale sheets and recent auction results for the same date, mint mark and grade. For a buy offer, the wholesale sheets carry the most weight, because they show what dealers pay one another.
Retail price guides list what a collector might pay a dealer, so they run higher than any buy offer will. Auction results sit near the strong end of the market. They come from competitive bidding with many buyers watching, and a dealer who buys a coin outright cannot count on repeating that result when it is time to sell.
PCGS and NGC also publish how many coins they have certified in each grade. Those reports help a dealer judge how scarce a top-grade coin really is, and dealers read them next to recent sales because the counts rise as more coins are submitted.
Paper money follows a similar pattern. Silver certificates redeem only at face value today, so any premium on one comes from collector demand for its series, its condition or a star note serial.
Why condition changes the math
Grade moves the collector premium more than any other factor. Coins are graded on the 1 to 70 Sheldon scale. In circulated grades a dealer can usually settle on a grade quickly and price it with confidence, but in Mint State, from MS-60 up, a single point can change the price a great deal and two careful graders can land a point apart.
That is why we check each coin under a loupe in front of you for date, mint mark, wear and eye appeal. If you expected MS-65 and we see MS-63, we show you why, whether it is light hairlines or a rub on the high points of the design.
Eye appeal counts as well. Two coins with the same grade can draw different offers when one has even, attractive toning and the other has a dark streak across the portrait. Dealers price what a collector will pay, and collectors pay more for coins that look good in hand.
Raw coins carry more grading risk than coins sealed by PCGS or NGC. A dealer pays for the grade they can stand behind, so an ungraded coin that might have been cleaned gets a more careful offer than the same coin in a slab. Cleaning lowers the grade and can cut a coin's value by half or more. When a grade question involves an expensive coin, you can send it to a grading service and let the holder settle it.
The spread, full retail and why two offers differ
The spread is the gap between what a dealer pays and what the coin later sells for. It is narrow on common bullion, which sells fast to many buyers. It is wider on collector coins, which can sit in inventory for months and take more skill to buy correctly.
A dealer who paid full retail would have to sell above retail to stay open, and buyers know what retail is. The gap pays for insurance and the money tied up in inventory, and it covers the chance that the market falls before the coin sells. A pawn shop that rarely handles collector coins may price them as metal because it has no buyer lined up for them.
Two honest dealers can quote different numbers for the same coins. They may grade a raw coin a point apart, or one may already hold plenty of Morgan dollars while the other just sold out and wants more. For a large collection, a second written offer is a reasonable step, and an itemized list lets you compare the two line by line.
Watch how a dealer handles a mixed lot. A single bulk price for a whole box can hide a better date inside a melt figure, and an item-by-item price makes that harder to miss.
What to do if an offer seems low
Ask for the breakdown. A dealer should be able to tell you the spot price used for the metal, the grade given to each better coin and the price reference behind each premium. If one line looks wrong, ask about that line.
If the reasoning holds up and the total still feels short, take the written list to another buyer and ask them to price the same items. When you decline our offer, you keep every coin along with the list. Dealers also pay above their usual level at times, and these are the situations where it tends to happen:
- A collector client is already waiting for that exact coin.
- The coin fills a hole in a set the dealer is building.
- It is an unusual variety the dealer has been hunting, such as a Carson City Morgan in a hard-to-find grade.
- The whole collection is clean and well kept, and the dealer wants all of it.
Getting a coin offer explained in Austin
Our appointments run Monday to Saturday, 10am to 6pm, for sellers from Georgetown and Round Rock down to Kyle and Buda. Each one is private and one-on-one, so you can ask how every number on the list was reached without anyone waiting behind you. Where we meet is set when you book. A handful of coins takes about 10 minutes, and a large collection can take 30 to 60 minutes.
Austin sellers often bring a mix that tests every part of the formula, like a jar of pre-1965 quarters sitting next to a Morgan dollar passed down from a grandparent. We sort collector coins from melt coins first, so a better date is never priced as bullion. The metal then goes on a calibrated scale you can read, and the collector coins are priced against current demand.
For estates in Tarrytown, Westlake Hills or Hyde Park with a house full of albums, we can come to the home. Call (737) 200-7042 and we will return your call the same business day. The evaluation is free with no obligation, and you will need a government-issued photo ID if you decide to sell. If you accept, you are paid the same visit in cash, or by same-day wire for a larger sale, and if you decline, the written list stays with you.
Ready to sell? See how we handle free coin appraisals in Austin, or call (737) 200-7042.