O.T. - Gold

Aug 11, 2014, 8:19 AM

Any gold experts out there?.......specifically experts in Double Eagles?

Going through the mass of correspondence that accumulated during my month-long vacation I discovered an intriguing offer to sell 25 Double Eagles for C$37,500 (C$1500/coin). The offer came from an oil patch business acquaintance. I am guessing that the guy needs some cash. The true price of the gold content of these coins at today's gold spot price is approx. C$34,500.

I am not a coin collector but I do have an interest in gold bullion coins. I have been accumulating Canadian Maple Leafs for years. I also have a few British Sovereigns and South African Kruger Rands. A brief tour through Google suggests none of the Double Eagles offered to me has a numismatic premium - 1899(2), 1904(3), 1908(2), 1924(15), 1927(1), and 1928(2).

Question is - Does a premium over gold content exist in the market for non-numismatic Double Eagles? The guy making the offer to me is asking a premium of about C$120/coin. I wouldn't mind adding a few American circulation strike Double Eagles to my little stash of bullion coins.

comments (13)

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motorhead11 years ago

That's gold, Jerry. Gold!

SlickSpic11 years ago

@Art-The only thing I know about goal is this-Stay away from Aztec Gold. Captain Jack can attest to that.

ime11 years ago

Slick -but Captain Jack will get you high tonight

SlickSpic11 years ago

@IME-Haha.

pensionking11 years ago

There is no numismatic value above the spot price for the gold.

Having sold gold coins near the peak, after much research, I have found the most competitive dealers will purchase gold at 90 - 92% of spot price. If your friend needs cash, selling to a very competitive dealer will only garner him $31,500, at best.

So, if you are looking to acquire gold coins, advertise that you are buying at 95% of spot price and you should have ample opportunities. Or, make your friend an offer at $32,500 and see what he comes down to. At $32,500, you're still offering more than he'll get ANYWHERE else.

IMHO, Buying gold coins at 108% of spot price is quite inadvisable, unless you are highly speculative of the spot price rising.

jester21411 years ago

Part of it would depend on condition but I can't imagine 80+ year old gold coins having less than $130 in value beyond there gold content.

jester21411 years ago

Well Pensionking seems to know more about it than I do.

farmerart11 years ago

Thank you, pensionking.

Your reply has convinced me to take a pass on this deal. I will probably be doing oil patch business with this guy in the future so I don't want to piss him off by grinding him on his Double Eagles.

I'll stick with Maple Leafs.

jester21411 years ago

I'm curious pensionking, what would a dealer try and sell them at?

farmerart11 years ago

@jester214,

I can tell you this. The bullion coins that I buy at a big dealer in Calgary carry a premium of 2.25%-2.75% over the daily London gold spot price. These coins are the .99999 pure Maple Leafs produced by the Royal Canadian Mint. Premium varies according to amount purchased.

I have never sold any gold so I can't tell you what the discount would be at the same dealer.

pensionking11 years ago

Most dealers sell at around 102% - 104% of spot price, if reputable.

The "cash for gold" places are a joke (if not criminal)! They buy at something like 65% of spot price (can you say stolen merchandise?).

If you ever meet someone selling, by offering to buy at anything above 90% but below spot price is a win-win. They're getting more than they would have gotten at the best of dealers and you're paying less than you would have through a reputable dealer.

As a portfolio manager, I use goldprice.org to check the prices throughout each day.

jerikson4011 years ago

Art, seriously, in real life are you nearly as pretentious as you appear online?

sharkhunter11 years ago

I believe the price of gold will drop to new lows sometime over the next several months. well just looking at the past couple of years and using elliottwave analysis. It might even reach only $1000 per ounce. maybe.