Nickel metal value worth more than face

FistFullOfDollars

http://www.coinflation.com/

According to Coinflation $0.0503916 is the melt value for the 1946-2010 nickel on January 08, 2010. This is the first time I have noticed that a nickels metal content is worth more than face. If the value of copper & nickel continue to increase the gov might have to change the metal composition of the nickel or its size. Are there any nickel hoarders out there?

Weiss

Wasn't too long ago--just before the great recession started that nickels were above face value. Prices fell over the last year or two, but they were higher than this IIRC.

But the % isn't anywhere as great as copper cents. Imagine if nickels were "worth" twelve cents each. That's the % over face that copper cents are.

gecko109

<< <i>Wasn't too long ago--just before the great recession started that nickels were above face value. Prices fell over the last year or two, but they were higher than this IIRC.

But the % isn't anywhere as great as copper cents. Imagine if nickels were "worth" twelve cents each. That's the % over face that copper cents are. >>





At their height of $15/lb Nickel, and about $4/lb Copper, the Nickel coin (75%Cu25%Ni) was worth almost 8 cents. I had 10 bank boxes of them in my basement. I figured a thousand bucks is a thousand bucks, so why not sock them away for the future. I have since sold them back to the bank and bought gold with the cash. I can put $1,000 worth of gold on my fingertip with plenty of room to spare. However, $1,000 worth of nickels weighs approx 225 pounds!

Baley

great! I have a virtually unlimited supply of nickels that I can obtain for exactly 5 cents each... who do I sell them to for more than that?

Thanks!

konsole

don't forget too that the war nickels are worth over a dollar now.

gsa1fan

Dang, I just sold 3 war nickels for a $

gecko109

<< <i>great! I have a virtually unlimited supply of nickels that I can obtain for exactly 5 cents each... who do I sell them to for more than that?

Thanks! >>




As silver approached face value, people began putting them away. The only difference is the "lightswitch" law on the ban of melting of cents/nickels currently. But 3-5 years after the composition of the nickel changes, Big Brother wont give a frog's fat ass what you do with them! Its a freeroll if you dont count the potential of inflation eating into a large stash. But then again, I would assume that the copper and nickel prices would at the VERY LEAST keep up with inflation, if not just totally dominate it.

Baley

Its a freeroll if you dont count the potential of inflation eating into a large stash

besides the inflation issue (which I assume means the risk that the metal won't go up or i wont be able to sell, while the purchasing power of the face goes down)

its a "freeroll" if I also don't count:

-the trouble of obtaining enough nickels to make this worth while (not sure what your hourly wage is, but for me to be handling nickels for profit, the profit would have to be pretty substantial... much more than a fraction of a cent above face and probably north of 2x face)
-the storage issue and the associated risk of theft or loss (or of stubbing my pinkie toe against a stray brick of nickels)
-the transaction costs of cashing back out of nickels (transportation, time to move them, risk of not finding buyer, legal and tax issues, etc)
-the opportunity cost of tying up capital this way, instead of using it more productively

looking forward to your detailed response

gecko109

<< <i>Its a freeroll if you dont count the potential of inflation eating into a large stash

besides the inflation issue (which I assume means the risk that the metal won't go up or i wont be able to sell, while the purchasing power of the face goes down)

its a "freeroll" if I also don't count:

-the trouble of obtaining enough nickels to make this worth while (not sure what your hourly wage is, but for me to be handling nickels for profit, the profit would have to be pretty substantial... much more than a fraction of a cent above face and probably north of 2x face)
-the storage issue and the associated risk of theft or loss (or of stubbing my pinkie toe against a stray brick of nickels)
-the transaction costs of cashing back out of nickels (transportation, time to move them, risk of not finding buyer, legal and tax issues, etc)
-the opportunity cost of tying up capital this way, instead of using it more productively

looking forward to your detailed response >>




"the trouble of obtaining enough nickels to make this worth while (not sure what your hourly wage is, but for me to be handling nickels for profit, the profit would have to be pretty substantial... much more than a fraction of a cent above face and probably north of 2x face)"

Enough is such a relative term, I'd be happy with 10 bank boxes of 1964 quarters squirreled away in my basement.


-"the storage issue and the associated risk of theft or loss (or of stubbing my pinkie toe against a stray brick of nickels)"


The $1,000 face in nickels I had, took up about as much space as a very small microwave oven. Although theft briefly entered my mind, I dont preoccupy myself with such worries. With a plasma TV, a couple laptops, and quite a few other valuable items currently in my home, I cannot waste my time worrying about the "what if I get burglarized" scenario. It would just drive me nuts.



"the transaction costs of cashing back out of nickels (transportation, time to move them, risk of not finding buyer, legal and tax issues, etc)"


Have you ever sold junk silver coins to a dealer? What were the "transaction costs" involved? If you mean as far as cost to get out of the nickels at face value, simply deposit them into your bank account. Its free as long as everything is rolled (which is how you buy them in the 1st place). Oh, and it took me approximately 3 minutes to load up the 10 bank boxes into my Jeep. Another 12 minutes to get to the bank and unload, and about 2 minutes of watching the teller's dirty looks as she counted the boxes and gave me my deposit slip. But then again, im 34, it MAY take you a tad longer to load/unload 225 pounds of metal.



"the opportunity cost of tying up capital this way, instead of using it more productively "


This is the only point I will concede to you as I had an opportunity to purchase some rare gold bullion at the time I had my stash of nickels. When I originally bought the nickels, it was with money that wasnt doing anything anyway (except earning 0.9% interest). But after 6 or so months, opportunity DID knock, and I decided to put my $1,000 worth of nickels to better use.


In summary, just imagine you had $1,000, $2,000, or even $5,000 worth of bank boxes of 1964 quarters or halves in your basement right now that your father had decided to sock away as a "freeroll". If he never needed to use that coinage at face value, and it was there for you right now, you could have tens of thousands of dollars worth of metal. Of course, that same $5,000 invested in real estate or stocks in 1964 would probably have done better, but that was during a much different economic climate than today. I dont think people feel as comfortable in putting their cash into those vehicles anymore. And putting $5,000 worth of nickels in your basement is at least 10x as smart as putting $5,000 worth of hundred dollars bills under your mattress. And probably at least twice as smart as leaving the cash in a 0.9% interest bearing bank account. And if the time ever does come where you need, or just want out, you still have your original investment - inflation. Detailed enough?

Baley

so you acquired, stored, and lugged your measly 1/8 ton of nickels around and tell us how much money did you net profit?

oh, right, you didn't wait the required 46 years (2010-1964)

plus, you had to endure dirty looks?

stick to your plan cowboy, you'll be both rich AND popular

jmski52

Putting the prices into cents per oz. is interesting:

Copper = $0.21/oz.

Nickel = $0.51/oz.

I have a few 1 oz. Coppers that I kinda like. It's good to know that they actually ARE worth something.

A US Large Cent is now worth $0.08 in copper!

mkman123

There was a local person that I bought some 90% from a while back that did this exact thing. He was enthusiastically telling me about this. I believe he had over 1k fv in nickels and was eagerly hoarding up pre 82 pennies.

Not sure if it was really worth it but he put up a very convincing argument for doing this.

pennyholic

With regards to hoarding nickels I tend to only keep the ones that are AU so you get the best of both, coin and metal value. Just over the weekend I purchased a lot of coins that this guy had in a glass container ($220.00) from the late eighties. I pulled about 10 rolls of nickels out of it that I put aside as they were all nice 1982-1992 coins and although the dimes are not worth much in metal I also pulled about 5 rolls of AU from those same years. I still have to go through the quarters and pennies and will do the same. So in the end I almost do the same thing when purchasing silver and that is buy and hold the best condition coins you can.

7over8

i think only 6 mo to a year ago the same nickels were .08 cents each......they have lost value

57loaded

i just sit on my war nickels....no hoarding of the others

i sit on most everything now.

nickels may be a better play than sorting through pennies?

slantycouch

I'm topping this oldie with a question. I'm new to PMs so hopefully this isn't a stupid one.

I read another article today about people hoarding nickels as an investment for the future. A nickel is currently worth $.0555 according to coinflation. Seems like a lot of work. If people are saving them simply for the bullion, with a price this close to metal value, wouldn't it be easier to just to use that same cash to buy some nickel bullion bars that are easier to handle than sacks or rolls of nickels? Perhaps I'm missing something.

Weiss

<< <i>I'm topping this oldie with a question. I'm new to PMs so hopefully this isn't a stupid one.

I read another article today about people hoarding nickels as an investment for the future. A nickel is currently worth $.0555 according to coinflation. Seems like a lot of work. If people are saving them simply for the bullion, with a price this close to metal value, wouldn't it be easier to just to use that same cash to buy some nickel bullion bars that are easier to handle than sacks or rolls of nickels? Perhaps I'm missing something. >>



Slanty, what you see as a price close to metal value, the hoarders see as an attractive percentage.

A half cent is a very small amount--but not relative to the value of a nickel. $.0555681 is 111.13% of face value, and it's that percentage they see as desirable.

What if you could buy all the dollar bills you wanted, knowing they were worth $1.11 each? Would you buy a couple thousand dollars worth? That's the same value over metal that nickels are worth. Dollars aren't worth that much over their face value. But nickels are. And there is a good reason to believe they'll continue to increase in value.

You could buy all the nickel bullion you want (I think. Anyone buy nickel bars?). But you can expect to pay the full value of the nickel PLUS the smelting, assaying, shipping, profit, etc.

The nickels sell for less than their "value".

slantycouch

Weiss, thank you very much for the reply -- I appreciate the explanation.

Your example was good and clear. Using your example, correct me if I'm wrong... the situation now is that I can in fact "buy" as many as I want at a price less than the actual metal value, but no one is going to pay me more than face. It's either going to take the price of nickel shooting up, or the US changing the makeup of the five cent piece for the abundance of this option to dwindle enough to be able to sell them at more than face, right?

Sounds like you have to hoard a lot of nickels (and be willing to hold them for several years)...

Weiss

Well, it's technically illegal to melt the cent right now, and I suspect it's likewise illegal for nickels to be melted, too. If it's not now, it probably would be if their "value" shoot up comparable to what the pre-83 cent is.

While there isn't currently a significant market for copper cents, people do actually sell (and presumably buy) massive, heavy bags of them on eBay. At $.02 each the market is quite soft. But if they were "worth" $.05 each things might change. Not only buying and selling, but people willing to risk breaking the law by melting and even shipping them overseas to be melted (which is also currently illegal). Same thing would probably go if the nickel was worth $.10 or $.25.

Ironically, if the US government did change the composition of the nickel, it might do away with one of the primary uses for the metal--thereby reducing demand and the subsequent "value" of the nickel.

FWIW: I don't hoard nickels. But I do save all pre-83 cents and have for years.

What can you say? Metal heads are just a little crazy.

sinin1

refining costs on those nickels to separate base metals is currently cost prohibitive
I would wager

Darin

FWIW: I don't hoard nickels. But I do save all pre-83 cents and have for years.

About a year ago I gave my sister $50 worth of pennies because I didn't want to haul them to the bank. Never thought of searching them for pre 83's.
But I still have $30 worth, guess I should search them.

hammered54

so if it's "nickel" that your looking to hoard you might try Canadian nickel's...they were nearly pure nickel for a long time. till about the 80's I think.

slantycouch

<< <i>Ironically, if the US government did change the composition of the nickel, it might do away with one of the primary uses for the metal--thereby reducing demand and the subsequent "value" of the nickel.
>>



Interesting point - I was wondering about that.

Guess we'll just have to see what the future brings!

MJPHELAN

I thought it was the copper making it worth more than 5 cents.

Robb

<< <i>I thought it was the copper making it worth more than 5 cents. >>



It is. The nickel is 75% copper. This thread has been confusing.

Robb

1. Calculate 75% copper value :

(3.3551 × .00220462262 × 5.00 × .75) = $0.0277373


2. Calculate 25% nickel value :

(10.0992 × .00220462262 × 5.00 × .25) = $0.0278308


3. Add the two together :

$0.0277373 + $0.0278308 = $0.0555681

AboutAg

<< <i>-the storage issue and the associated risk of theft or loss (or of stubbing my pinkie toe against a stray brick of nickels) >>



I'm not sure which headline people would find more interesting:

"Thief Steals Lots of Nickels, But Overlooks the Pennies"

or

"Local Resident Loses 3,000,000 Nickels - The Hunt is On"

notwilight

<< <i>refining costs on those nickels to separate base metals is currently cost prohibitive I would wager >>



Not necessary. There are many copper nickel alloys used in various industrial applications. Since nickels are 75% copper and are probably very accurately alloyed per a govt spec they could be easily used to provide the copper in copper nickel alloys. The calculation of how much nickel to add would be easy. --jerry

notwilight

<< <i>

<< <i>Ironically, if the US government did change the composition of the nickel, it might do away with one of the primary uses for the metal--thereby reducing demand and the subsequent "value" of the nickel. >>

Interesting point - I was wondering about that. Guess we'll just have to see what the future brings! >>



Both copper and nickel have industrial applications that drive their price. Copper is the primary conductor used in almost all industrial and even residential wiring applications. Nickel is mostly used to make stainless steel. I would doubt that the use for coins significantly impacts the price of either. --jerry

hammered54

Spot quotes are non-LME prices
Live Spot Prices

SPOT PRICE IS OPEN
Price: US$/lb


Copper March 24,15:01
Bid/Ask 3.3101 - 3.3146
Change -0.0082 -0.25%
Low/High 3.3101 - 3.3251
Charts

Nickel March 24,14:44
Bid/Ask 10.0146 - 10.0599
Change -0.0227 -0.23%
Low/High 10.0146 - 10.0985

I think I'd be after the nickel myself....which lead's me back to ...Canadian nickel's.

AJ2525

Hello,

I'm a little crazy too. I'm filling an ammo can with per-1982 cents. I also have about $35 in nickels in a plastic container. Why? No good reason other than they are worth more than face value.

Why do you have a gold eagle with a face value of $20?

Or even an American Silver Eagle with a face value of $1.

I do understand the value of my time and storage. So far I've spent much less time doing that than I have on this board reading posts.

Robb

You are comparing apples to three-headed sea horses, AJ2525.