Sunday, April 1, 2012

Silver Numismatic Lunars vs Silver Bullion Lunars

As I mentioned in a post several days ago:
I do think there will definitely be modern numismatic coins which perform poorly into the future, including some of the Dragon coins. One thing to keep in mind is that the price of the individual coins or sets could stay above their release price but still be considered to perform poorly if spot price increases significantly. For example if Silver rises to $60 per ounce and this 10 Coin Set is only selling for $1100 (still a 10% increase on issue price) then you would have been much better off putting your cash into low premium Silver instead of this set. Bullion Baron
I recently came across a couple of old monthly newsletters from around 8 years ago which advertised the price of Perth Mint numismatic Lunars on release.

Here is a page from October 2004 issue when the Lunar Rooster (2005 Design) had just been released:

CLICK IMAGE TO ENLARGE
And here is another from December 2003 when the Lunar Monkey (2004 Design) was released:

CLICK IMAGE TO ENLARGE
So how have these numismatic Lunar coins performed relative to the price of Silver (spot price) and bullion Lunar coins?

October 2004 AUD Silver Price: $9.75
December 2003 AUD Silver Price: $7.66

Spot price today is is AUD $31.20, so the spot price has increased 3.2x from October 2004 and 4x since December 2003.

The monkey and rooster bullion coins would have sold for roughly $7 higher than spot price per 1 ounce coin (according to a member on Silver Stackers) when Silver was that low in price, so prices would have been roughly $16.75 in October 2004 and $14.66 in December 2003.

Today the price of a 1 ounce Lunar Monkey or Rooster is roughly $75 (more on eBay), so the bullion 1 ounce Silver Monkey has increased by 5x since release and the bullion 1 ounce Silver Rooster has increased by around 4.5x. This performance is well above that of the spot Silver price or low premium bullion products such as Silver bars or high mintage coins such as the American Silver Eagle or Canadian Maple.

How have the modern numismatic Lunar coins performed since their release?

They don't come up all that often, but here are a few examples from the above newsletters:

2005 Rooster 3 Coin Set (October 2004 $257)
Recently went unsold on eBay (Germany) for US$985 (AUD$950)
Being unsold it makes it difficult to guesstimate market value, but we can definitely say that it hasn't increased as much as the bullion Lunars (as the unsold price is lower multiple than their increase).

2005 Rooster 1oz Proof Coin (October 2004 $71)
Recent sale of $167.50 on eBay (AUS)
Increased around 2.35x (less than spot and well less than bullion Lunars)

2005 Rooster 1/2oz Proof Coin ($52)
Recent sale of US$145 on eBay (Germany) (AUD$140)
Around a 2.7x increase.

2004 Monkey 5oz Coloured/Gilded Coin (December 2003 $399)
Although I couldn't find the monkey, a Rooster of the same type recently sold on eBay for US$317 (AUD$305), so has infact sold for a loss even after 8 years.

Assorted 1oz Gilded Silver Coins (December 2003 $49.50 each)
These regularly sell in the vicinity of $100-$150 (so have increased by a factor of only 2-3x), the only exception being the Gilded Dragon which I've seen selling for around $200-300 which is a pretty similar multiple to the Silver bullion Lunars.

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The results, while varied, show that the bullion Silver Lunars have performed much better than the spot increase and much better than the numismatic Lunar coins. In most cases low premium Silver would have outperformed the numismatic Lunar coins as well.

There will always be exceptions, but you should be giving thought to where the Silver price might head over the next few years. If it heads to triple digits ($100+ as per my expectations) then there's a good chance that low premium Silver or bullion Silver Lunars will far outperform many of the numismatic releases hitting the market today.

Food for thought before you shell out the cash for that next Perth Mint numismatic Dragon releases yet to come (such as the soon to be released Perth Mint 2012 Year of the Dragon Ten-Coin Set and forthcoming Perth Mint 5oz Proof Dragon Coin). They are very nice looking coins as are most of the Perth Mint Lunar releases, but they aren't necessarily going to perform as well as the bullion coins over time.


Cheers

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