Lear Capital Explains What You Need to Know About Commemorative and Other Coins
October 11, 2023 (Investorideas.com Newswire) In addition to the value precious metal coins possess due to their content, some are also of interest because they have other qualities, according to Kevin DeMeritt, founder of precious metals provider Lear Capital.
As The Royal Mint - the official maker of British coins - explains, several factors can affect the demand for a coin, including whether it's currently in circulation, if it was specifically created to be a collectible item, and the overall quantity that was produced.
With an atypically low mintage, a coin could potentially have a secondary market selling price that's higher than its face value, according to the U.K.-based coin creator.
In essence, the harder a coin is to obtain, the more coveted it can become - a scenario that Kevin DeMeritt says the industry experienced during the COVID-19 pandemic.
"If you go to the U.S. Mint as a dealer and purchase a silver 1-ounce American Eagle, usually you would pay $2.50 over the spot price for that coin," DeMeritt explains. "During the pandemic, you had supply side issues; they couldn't run the mint as much as they wanted to. You saw a tremendous demand [for coins] - that typical $2.50 premium for a silver American Eagle skyrocketed to $14 and $15 over the spot price of silver."
Understanding Commemorative and Other Coins
A number of different types of coins can appeal to collectors and investors - for various reasons.
Bullions, for instance, are coins produced by government-operated mints in countries around the world; the weight of their precious metal content generally determines their price. The American Eagle Silver coin is an example of a bullion that's been issued since 1986.
Proof coins - which can feature an intricately detailed design that may require a longer minting process - tend to be produced in smaller quantities. While they, like bullions, possess a certain precious metal composition that provides value, buyers may also be interested in proof coins because of their limited availability and unique appearance.
Another subset of coins, referred to as rare or premium coins - which were issued before 1933 and cannot be produced again - offer both a desirable precious metal content and the allure of limited production.
Take the Morgan Silver Dollar - a coin with a silver composition of 90% and was named after its designer, George T. Morgan, an assistant engraver at the United States Mint - which was struck in Philadelphia, New Orleans, Carson City, Nevada, and San Francisco from 1878 to 1904, and then again in 1921.
From September 2021 to September 1 of this year, the version of the coin that was issued in 1878 rose in price from approximately $950 to $1,300, according to data from industry appraisal and certification provider Professional Coin Grading Service.
Lear Capital's New Coin Series Will Be Produced in Limited Quantities
Lear Capital recently announced it will debut a new series of exclusive commemorative coins this fall that pay homage to the Mount Rushmore National Memorial in South Dakota. Both gold and silver versions of the four coin designs are scheduled to be released.
Production, though, will be limited. Just 30,000 0.25-ounce gold coins and 300,000 1.5-ounce silver coins will be issued in Lear Capital's upcoming series, according to Kevin DeMeritt.
Each of the designs feature one of the former U.S. presidents who are depicted on the Mount Rushmore monument - George Washington, Thomas Jefferson, Theodore Roosevelt, and Abraham Lincoln.
Sculptor Gutzon Borglum, who crafted the Mount Rushmore National Memorial between 1927 and 1941, selected those specific historical figures to represent the birth, growth, development, and preservation of the United States.
The first coin in the series to be offered, showcasing George Washington, will be available for purchase beginning in mid-October.
Holding Physical Precious Metal Assets in an IRA
Over the years, Lear Capital has also released a number of other exclusive coins - such as its 0.25-ounce Gold Snow Falcon coin, produced by the esteemed Royal Canadian Mint, and the 0.25-ounce RCM Kermode Spirit Bear Gold coin, honoring the black bear subspecies.
Those coins, along with others that Lear Capital has released, including its Gold Snowy Owl coin - a 0.25-ounce item that depicts the iconic bird - possess a 99.9% gold composition, which is a high enough purity level to allow them to be included in a self-directed individual retirement account.
With a self-directed IRA, investors can hold both physical precious metal assets, such coins or bars, along with other types of investments. You just need to establish and fund the account by adding money directly or rolling over funds from another type of retirement account. You can then use the funds to purchase physical precious metal assets, which need to be stored remotely in an IRS-approved facility.
For more than two decades, Lear Capital has helped investors complete the steps that are involved in setting up and transferring funds into a self-directed IRA account.
"It's a pretty easy process," Kevin DeMeritt says. "Simply give us a phone call; talk with one of the representatives, who will get you the paperwork to transfer whatever portion of that IRA, 401(k), or 403(b) you would like over to a physical precious metals IRA. You can purchase, sell, or liquidate those precious metals at any time."
Much like investors who hold their precious metals in an IRA, collectors who purchase items primarily for a collection can also benefit from gold, silver, and other precious metal price increases - as well as a growing demand for certain coins.
During the pandemic, for example, if you owned a silver 1-ounce American Eagle coin, even if silver's value didn't significantly rise, you could have made a profit, according to Kevin DeMeritt.
"Any time there are huge amounts of demand for the metals, usually the mints just have a very difficult time keeping up, so [coin] premiums go up," he says. "You could have turned around and sold that coin - [which] you paid $2.50 over the spot price for - [at] $14 or $15 over the spot price [of silver], even though [the price of] the metal didn't move at all."
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