How do dealers calculate what multiple of face they will pay for junk silver?

somniferum

Anybody have the easy answer for me?

cinman14

spot price X's .715 will give them melt multiplier. Then minus as much as the market will allow
for a reasonable screwing....

My experience would tell me the buy price is 1x's under and the sell price is 1x's over.

edited to add: The dealers I buy from on the BuySellTrade board seem to sell very close to melt for 90% coinage
and bullion rounds.

And also a BIG



Enjoy the ride

FishyOne

cinman14 has the simple multiplier. It works except on dollars, I usually take the silver weight in troy ounces (dimes=0.072, quarters=0.181, halves=0.362, dollars=0.774) X spot price.

You'll note that 90% silver dollars have a higher weight for their denomination than the others. Silver dollars contains about 7% more silver than 10 silver dimes or 4 silver quarters.

Good Luck!

CaptHenway

The quantity being sold has a lot to do with the price being paid. We have to fill out a form and take identification on every purchase we make. It takes just as much labor to do a form for 10 silver dimes as it does for 10,000 coins (a $1,000 bag.) The small purchases are paid accordingly.

BigMoneyLewis

Just go to coinflation.com to find out the current spot price of any 90% silver U.S. coins,
as well as the 35% and 40% as well .

Lewis

cinman14

<< <i>Just go to coinflation.com to find out the current spot price of any 90% silver U.S. coins,
as well as the 35% and 40% as well .

Lewis >>



coinflation uses a multiplier of .723 X's spot to get their melt value. I believe this number is used for
AU to BU 90%

I could be wrong on the reason coinflation is higher. I have been taught from this forum that .715 X's spot
is for circulated 90%...

Deadhorse

<< <i>

<< <i>Just go to coinflation.com to find out the current spot price of any 90% silver U.S. coins,
as well as the 35% and 40% as well .

Lewis >>



coinflation uses a multiplier of .723 X's spot to get their melt value. I believe this number is used for
AU to BU 90%

I could be wrong on the reason coinflation is higher. I have been taught from this forum that .715 X's spot
is for circulated 90%... >>



You are correct. All B&M shops will use the multiplier of .715

It's the number I've used for over a decade. Yes, Silver dollars are different as they contain .77 ounces, plus Silver Dollars have always carried a premium just because the are Silver Dollars.

somniferum

Thanks for the excellent info, folks. I've been buying/trading/melting 90% junk for a couple of years and I've always wondered how my local guys come up with the magic number. It would have been easy enough to simply ask them, but I felt like I would have been tipping my hand in doing so. No offense to any junk dealers that might do business here, but the three guys I deal with regularly are a touch on the shaky side of cunning.

JohnMaben

Most coin dealers don't use multipliers to determine their buy price for 90% coin.

There are a half dozen major market makers on dealer trading networks that will quote buy/sells for 90 bags ($1000 face) at any given moment.

Usually their bids are within a couple percent of each other, so all your local guy needs to know is what they are paying him and then he backs off from there according to how much face value you have to sell.

No formula's, no rocket science at the street level.

John

somniferum

That makes a lot of sense. I have at times bought all the available junk from my three guys and sometimes their prices don't quite match. If they were all using the same formula I suppose that their offers would always be roughly the same. At any rate, I now have good info for making offers to folks for the random caches of junk I come across.

Roadgold

take a look at this site it takes out all the guess work linky

Greeniejr

Not quite. The problem with this website is that it assumes the coins are BU meaning no loss of metal. This leads to a 724ish oz bag. The standard in the industry is that since there is some loss from circulation, the AVERAGE bag has 715

gecko109

<< <i>Not quite. The problem with this website is that it assumes the coins are BU meaning no loss of metal. This leads to a 724ish oz bag. The standard in the industry is that since there is some loss from circulation, the AVERAGE bag has 715 >>




For a change, David and I actually agree on something!


The .715 multiplier is just to calculate ACTUAL SILVER VALUE of 90% "junk" circulated coins. After that is established, let the negotiations begin.


P.S.- Most FAIR dealers will sell for 8% or less above melt, and buy for about 8% or thereabouts below melt. Anything that deviates from this is a bad deal IMHO.

Deadhorse

<< <i>Most coin dealers don't use multipliers to determine their buy price for 90% coin.

There are a half dozen major market makers on dealer trading networks that will quote buy/sells for 90 bags ($1000 face) at any given moment.

Usually their bids are within a couple percent of each other, so all your local guy needs to know is what they are paying him and then he backs off from there according to how much face value you have to sell.

No formula's, no rocket science at the street level.

John >>



Yeah............. well, while that is true for the most part, the fact is we're trying to spread a little education as was requested. We're not talking to dealers or wholesalers. Using the .715 method will give people, even beginners, a fairly close outline on what they are actually dealing with and it's hardly rocket science.

Well aware of the market makers, but that is a term most laypeople have never heard of. Regardless of what the buy/sell guotes are, they won't stray too far from the .715 guideline and that will allow regular folks to buy and sell amongst themselves.

The market makers don't give a damn about regular people or small amounts of melt coinage here and there.