Insights

Valuing the most common coins in the U.S. marketplace

When dealers sell to dealers, a wholesale market is established
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By Steve Roach-Coin World Staff
Published : 06/18/12
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This market analysis often deals with singularly expensive coins because those are the coins that generate headlines.

These “big” coins are perhaps atypical of the business that really fuels the coin market. The unglamorous common U.S. coins that are collected by casual coin collectors, and accumulate in coin shop inventories before they are typically sold in groups at the wholesale level, are a major driving factor in the coin market.

For example, multiple different markets exist for circulated Lincoln, Wheat cents, and large coin shops will — after taking out any individually tough dates — sort them by decade. While a wholesale dealer might buy a $50 face value bag of common, unsorted Wheat cents for $175, the price for a bag with 1909 to 1919 cents will cost nearly $1,000. For cents in the 1920s the price drops to $600 while 1930s cents sell for around $300 for a bag of 5,000 coins. San Francisco Mint cents also carry a premium at around $250 per bag while a bag of rust-free 1943 Lincoln zinc-coated steel cents can trade at the $600 level.

Even small jumps in value can add up to real money when large groups of coins are involved. With silver at $28.50 an ounce, a cull Morgan or Peace dollar — a coin with substantial problems such as heavy polishing, wear or other damage (but not holes) — might trade for $25.50 at the wholesale level. A Fine Peace dollar jumps to $27, which is the same price as for a typical 1921 Morgan dollar. Common Fine to Very Fine 1878 to 1904 Morgan dollars can be found at $28 while those grading Extremely Fine or better might trade at $29. A dealer might sort a group of Morgan and Peace dollars into 10 different groups for sale to wholesalers.

Common modern commemorative coins are also traded in large groups at the wholesale level — often in capsules only — at the $25.50 level. For the common issues, original Mint packaging takes up too much room in stores (and in shipping boxes), which cuts into already modest profits.

Common pre-1965 90 percent silver coins are often traded in $1,000 bags at a multiple of face value, with circulated coins selling for 21 times face value and Mint State coins bringing 22 times face value. Additional premiums are attached to bags of Walking Liberty half dollars and Winged Liberty Head (Mercury) dimes.

Proof and Uncirculated Mint sets also can be traded in large groups at discounts to levels published in wholesale price guides, although the discount may vary based on the demand for a particular date, which is often based on dealer promotions.

While some dealers move their common coins to wholesalers as they acquire them, others build inventory over time, creating large groups of similar coins to better capitalize on these small price adjustments. ■

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