What Are Bullion Coins?
Coins composed primarily of a precious metal and with no significant value beyond that of the metal are one form of bullion. Prices for bullion coins vary with the spot price of the metal. Many investors prefer coins to other forms of metals, such as bars, because coins do not need to be assayed when sold.
Several governments produce gold bullion coins. Examples include the South African Krugerrand, the Canadian Maple Leaf, the Chinese Panda, and the American Eagle. Each sells for a small premium above the value of the gold in the coin.
Silver and platinum bullion coins are also produced by some mints. For example, the U.S. mint has made Silver Eagles (containing one ounce of silver) each year since 1986. Uncirculated silver eagles sell at a premium above spot silver, generally ranging from $1.35 to $4.00 per coin (depending on quantity, dates and source).
Common date circulated silver coins are also bought and sold as bullion. U.S. dimes, quarters and half dollars dated 1964 or earlier are 90% silver and were made with 0.723 ounce of silver for each dollar in face value (as some metal may have been worn off from circulation, 0.715 ounce/dollar is often used to estimate the amount of silver still present). These coins were often melted and refined to other forms.