### How do you calculate the value of the gold or silver in your coin (or WTC medallion)?

According to their advertising, the medallion is clad in “24 KT gold” and “.999 Pure Silver!” The advertising leads one to believe that the gold and silver make this item more desirable. So how much is the gold and silver in the medallion worth? Or for that matter, how much is the gold and silver in any of our coins worth?

So I thought I would do a write-up to help everyone understand just how to determine the answers to these questions. There are two things that you need to determine this: weight and fineness.

**If you just want to know the answer to how much the gold and silver is worth in the National Collector's Mint medallion, jump straight to the last paragraph. If you really want to know how to calculate the value yourself, read on.**

Let’s start with fineness. Fineness is the measurement of the purity of the metal. One method of describing the fineness of gold is the karat (kt). This is the measurement of the proportion of gold in an alloy equal to 1/24 part of pure gold. For example, 12kt gold is 12/24 part of pure gold or 50% pure gold, 22kt gold is 11/12 part of pure gold or 91.7% pure gold, and 24kt is 100% pure gold (as in the new gold Buffalo bullion coin).

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So, to bring the two methods together, 22kt gold is the same as being .917 fine or 91.7% pure gold. This is step one to determining the value.

Step 2 is to determine the weight of the metal in the coin. This is a little trickier to understand. There are two different methods of weights used depending on whether it’s a precious metal or a base metal. Precious metals (i.e. gold, silver, platinum) use Troy Weights where base metals (i.e. copper, nickel, etc) use Avoirdupois Weights, abbreviated avdp. Nickel can be a little trickier because in the early days of the mint, it was considered a precious metal and used the Troy system. Today nickel is considered a base metal and uses the Avoirdupois system.

The most important thing to keep in mind is that regardless of which method of weights is being used, the one measurement that is equal in both systems is the grain, abbreviated gr. (i.e. 1 troy grain = 1 avdp. grain) When looking at the daily spot prices of metals, you will find the precious metals quoted in troy ounces and the base metals per avdp. pound. So what you need to know is how many grains make up each of those units.

For troy weights, 1 pound (lb) = 12 ounces (oz) = 240 pennyweight (dwt) = 5760 grains (gr)

For avdp weights, 1 pound (lb) = 16 ounces (oz) = 256 drams (dr) = 7000 grains (gr)

So, now lets go through an example using a $1 Morgan which is listed in the 2007 Redbook as 412.5 grains, .900 silver, and .100 copper (copper being added to increase the hardness of the coin). Basically, this coin is 90% silver and 10% copper. Using these proportions on the grains, the coin is 371.25 grains of silver and 41.25 grains of copper. Using the troy weight system on the silver, this is equal to 0.773 oz. of pure silver. Using the avdp weight system on the copper, this is equal to 0.006 lb. of copper. Using spot prices from 9/8/2006 of $12.16 per oz. of silver and $3.56 per lb. of copper, the metal values of the morgan silver dollar would come to $9.40 of silver and $0.02 of copper in each mint state coin.

So how about a $20 double eagle? Again using the 9/8/2006 spot prices where gold is $609.60 per troy oz., the 2007 Redbook lists the double eagle as 516 grains, .900 gold, and .100 copper. But this is actually inaccurate because legislation allowed for up to 5% of the alloy to be silver, not just copper. So for this example, I will use .900 gold, .050 silver, and .050 copper.

After doing the appropriate conversions, the gold content comes to 0.9675 troy oz. of gold or $589.79 of gold. The silver content comes to 0.05375 troy oz. of silver or $0.65 of silver. The copper content comes to 0.0037 pounds or about $0.01 of copper.

Here are the equations I used for the $20 double eagle:

Gold equation: (516 x 0.9) / (5760/12) = 0.9675 troy oz.

Silver equation: (516 x 0.05) / (5760/12) = 0.05375 troy oz.

Copper equation: (516 x 0.05) / 7000 = .0037 lb

Now, just because you know how to calculate the value of the metals in your coins, don’t go running out to sell your 90% silver and expect to get these values. Selling these for melt is a whole different story. One dealer that I know of that buys 90% silver for melting told me that they basically just add up the face value of all the coins, and then multiply it by .715 which, in general, covers the wear on coins along with the dealer’s cut of the proceeds. When they sell it to the refiner, they actually get anywhere from 95% to 98% of the spot price depending on the quantity of the metal. But don’t think you can skip the middle man and go straight to the refiner. The minimums required to sell directly to them are pretty high.

So, how much is the gold and silver worth in that World Trade Center Commemorative “clad in 24 KT gold and .999 Pure Silver” being marketed by National Collector’s Mint for $29.95? Since both the gold and silver are basically pure with no alloy added, all we need is the weight of each metal. According to their website, both are 15 milligrams (mg) each of gold and silver. Oops, this needs a new conversion I didn’t cover above. How many mg per troy oz? Well, 1 mg is equal to approximately 0.0154 grains. So, multiply 0.0154 x 15 = 0.231 grains (yes, that’s less than ¼ of a single grain each of silver and gold!). Divide the grains by 480 (grains per troy ounce) = 0.00048 troy oz. each of silver and gold!!! That means there is 29 cents worth of gold and approximately ½ cent of silver!!! So, each medallion has less than 30 cents worth of precious metals in it!!! This is not a joke, do the math!!! The 15 mg of gold and silver came from their website, I did not make it up!!!

UPDATE SINCE THE ORIGINAL ARTICLE WAS POSTED!

Someone who read my original post sent me a real cool way to simplify weight conversions without having to do all the math. If you recall my WTC medallion example, it is clad in 15mg of 24k gold and 15mg of .999 fine silver. Since both metals are basically pure, all I had to do to calculate the weight of each metal was go to Google and type the following into the search box:

15 mg in troy oz

and out came the answer:

15 milligrams = 0.000482261199 troy oz

Multiply that by the price of gold and silver, add the two results together and guess what? It's still only about 30 cents worth of precious metal in the WTC thing!

Just keep in mind that if you do use this Google calculator, you still have to multiply any answer by the finess of the metal whose value you are calculating.

So consider my original post as an academic exercise in how to do the calculations yourself. I plan to use the Google calculator going forward.

## 10 Comments:

This is why I don't buy the alleged tribute medals (they are not coins) from these private mints who overhype their products. I would not buy from the National Collector's Mint since they have previously been in trouble with the US government. Even the US Mint has put out warnings against these people.

Please do not mis-interpret my comment. I have bought silver rounds and commemoratives from other private mints (check out my blog http://coinsblog.blogspot.com for something I purchased from the Honolulu Mint in February). I was very happy with the purchase and the product. But the private mints I purchased from did not try to mislead me as to what I was buying and not trying to use linguistic twists to make their products sound like something it is not.

Before you buy from a private mint, understand exactly what you are buying! As Arlington showed you, you should buy the steak, not the sizzle!

Caveat emptor!It is not often that I find informative websites on coin collecting that I like. Especially those that help to keep collectors informed so that they don't lose the shirts off their backs. But the blog written by Scott in the preceding comment is one I highly recommend reading. (here's the address again: http://coinsblog.blogspot.com) More blogs like his can only help to improve our hobby of coin collecting.

Someone who read my original post sent me a real cool way to simplify weight conversions without having to do all the math. If you recall my WTC medallion example, it is clad in 15mg of 24k gold and 15mg of .999 fine silver. Since both metals are basically pure, all I had to do to calculate the weight of each metal was go to Google and type the following into the search box:

15 mg in troy ozand out came the answer:

15 milligrams = 0.000482261199 troy ozHow cool is that?

Multiply that by the price of gold and silver, add the two results together and guess what? It's still only about 30 cents worth of precious metal in the WTC thing!

Just keep in mind that if you do use this Google calculator, you still have to multiply any answer by the finess of the metal whose value you are calculating.

So consider my original post as an academic exercise in how to do the calculations yourself. I myself plan to use the Google calculator going forward.

I purchased the original silver dollar coing (2 of them) and the color one to pass on to the kids to always rember.

This breaks my heart I was ripped off.

I just found out 9/13/2008

Well don't feel too bad, at least the medallions can still serve the purpose of helping your kids to always remember if that was your original intent.

I paid over $100 for an American Silver Eagle bullion coin that was recovered from the World Trade Center site so that I would have something to help me remember. It serves its purpose well each time I look at the coin.

We bought a few of these american platinum eagles that we enjoyed your post.

I have recently become a member of The History Channel Club and I am collecting the $100 million American Gold Classics

Collections and each piece is layered in 10 mils pure gold.

How much gold is in each coin? What is the meaning of mils

and the worth of each coin??

Mills is a small thin layer of gold, worth pennies at best. You got had brother.

In the costume jewelry industry, the thickness of the gold overlay is referred to in microinches or mils. 1 microinch = 1 mil = 1 thousandth of an inch (not millionths). So 10 mils would mean that your gold layering covering the coin (I use the term coin loosely) is 10 thousandths of an inch thick.

To put it in perspective, that's a little more than twice the thickness of the paper I use in my printer.

Since gold and silver have skyrocketed in price it seems every crook has come out from under their rock selling 'valuable' coins. Do a little research online before buying anything. Research both the company doing the selling and whatever it is they are selling. I got a flyer in the mail just last week trying to sell me some kind of garbage 'coin' with Obama's picture on it. Even if I had voted for Obama I wouldn't be buying worthless garbage like what they were trying to sell me though.

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