Frequently Asked Questions
Investing in Bullion
What kind of items are considered bullion?
Popular gold, silver, platinum and palladium coins such as U.S. Eagles, Canadian Maples, South African Krugerrands, Australian Kangaroos, British Sovereigns and Chinese Pandas are minted at national mints. Other well known, private mints such as Credit Suisse, Sunshine Minting, Engelhard and Johnson Matthey currently produce or have produced both bars and coins. Additionally, U.S. minted dimes, quarters and halves from 1964 or earlier contain 90% silver (0.715 oz. per dollar face value).
When you are ready to invest in precious metals, you will want to find a dealer you can trust and who has been in business for many years. While lower prices can sometimes be found elsewhere, you will usually get better customer service and competitive pricing at a local dealer.
What is "junk silver"?
First off, "Junk silver" is not junk! Coin dealers refer to pre-1965 dimes, quarters and half dollars as junk silver only to differentiate them from numismatic collectibles. "Junk silver" is typically sold by face value ($5, $10, $100 and $1,000 being the most common increments). These coins were minted from 90% silver, and for each $1 face value there was 0.7234 troy ounces of silver when the coins were new. Allowing for wear, the industry accepted practice is to figure 0.715 troy oz. per $1 face value.
In 1965 silver was removed completely from Quarters and Dimes, and dropped to 40% in Kennedy Half Dollars until 1970. There is 0.296 troy oz of silver for each $1 in 40% Halves, and these usually sell for a very low premium.
Since 1970 only special issue coins contain any silver. Some Eisenhower dollar uncirculated and proof coins were 40% until 1976 and special proof coins since 1992 have been struck in 90% silver.
Which should I buy, gold or silver? Why?
There are plenty of reasons to choose to invest in gold or silver, and each has its own benefits. In the past, during times when the prices of metals are surging, the ratio of gold to silver shrinks, meaning the price of silver has risen faster than the price of gold. During the last big price hike, the ratio of silver to gold was 40:1. During the period that followed, the ratio fell to closer to 70:1. So what does that mean? Many experts feel that buying silver during low points in the market could lead to a greater return percentage when the market spikes again.
That said, when it comes to large volume, silver becomes cumbersome and hefty very quickly. If you're looking to put a significant amount of money into metals, it is important to keep this in mind. A person could store several thousand dollars or more in just a handful of gold coins, but to do so with silver would require hundreds of ounces and safe place with plenty of room to store them.
What truly matter most however, is finding your specific needs and filling them. When you come to the store, feel free to ask us more specific questions, and we'll happily advise you in the route we believe to be the best to suite your needs. And remember, you're never pressured into a sale. We're only here to help!
What about numismatic gold coins?
A lot of nationally advertised dealers will push pre-1933 U.S. Gold coins, and like to point out that the government confiscated gold in 1933 but exempted collectible coins. They hint that it might happen again, but if you buy their numismatic gold offerings you will be safe. In 1933 Gold WAS money. The Federal Government confiscated the people's gold (with the exception of 5 oz per person) to keep the government solvent- it was an emergency measure. It also had the benefit (from the Federal Reserve's point of view) of severing the link between gold and paper, allowing unfettered inflation of the currency. Gold is no longer legal tender money so there would be no actual purpose or reason to try confiscation again (unless the government decides to confiscate other kinds of savings like IRA and 401(k) accounts). That said, collectible coins are pieces of history and have appreciated much faster than bullion, so there is nothing wrong with owning them.
What forms of payment do you accept?
We accept the following forms of payment: A personal check, cashier’s check (bank check), bank wire or direct deposit. Cash is acceptable if the sale is less than $10,000 and you are paying in person. We also accept credit or debit card purchases (excluding American Express) if you are here in person but a three percent additional charge is incurred.
We do not accept cash payments greater than $9,999 because . . . regulatory rules would require us to file paperwork with the IRS to report the transaction.
We do not accept international orders, or payments from other countries.
What is the "spot price"?
The spot price is set by paper trading on the stock market for contracts of 100 oz of gold or 5000 oz of silver, not by physical metal in the real world. It is a number subject to change moment to moment. We base our pricing on the "Ask" price on amark.com when we are selling to customers. If we are buying from a customer, we base our offer on the "Bid" price. There are other websites that post the spot prices but some of them run behind by ten minutes or more.
What's the most economical way to buy bullion?
For many people, buying in increments of one ounce is the most economical. If you buy metal in fractions of an ounce, the premiums are generally higher. Pricing is usually based on spot prices linked to the stock market. You can find spot prices on websites such as coininfo.com which show a "bid" and "ask" price. When dealers are buying precious metals, the offer is based on the "bid" price. Sell prices are based on the "ask" price. Supply and demand also factor in on the pricing.
Do you offer volume discounts?
We can get you a lower price per ounce by locking in a price with our suppliers at the time you are ready to buy. This is accomplished by ordering in larger quantities, usually 200 oz. or more on silver and 10 oz. or more on gold. Discounts will vary depending on supply and demand at the time of purchase. Purchase prices are locked in and must be paid in full before product is ordered. When the product is received at our business, we will notify you and you can pick it up at your convenience.
Selling to Missoula Gold & Silver
What is the process for selling to Missoula Gold & Silver?
Would you like to sell items such as gold and silver bullion, coin collections or scrap jewelry to Missoula Gold & Silver Exchange? MGSE is one of the premier gold buyers in the state of Montana. We buy scrap gold, dental gold, broken chains, class rings, gold, silver or platinum jewelry, sterling silver flatware, gold nuggets, placer gold, individual coins, collections/accumulations and estates. The process is simple. Visit us Monday through Friday, 9am-5pm and Saturday, 9am-4pm MST. We will examine your items and make an offer based on the current bullion spot prices or market values for coins and collections. We will meet or beat any legitimate locally advertised prices. If you can’t make it in, feel free to call us about any specific items you wish to sell.
Does you still buy and sell sports cards?
Due to the sharp downturn in the collectable sports cards market, we unfortunately no longer sell them. We do, however still sell card collecting supplies, such as card holders, nine pocket pages, team set bags, and shoe boxes.
Precious Metal Facts
How are precious metals weighed?
Traditionally, precious metals have been used to store wealth in good times and bad. Precious metals are weighed in troy ounces not avoirdupois ounces (used to weigh food, people, mail, etc.). There are 28 grams in an avoirdupois ounce and 31.1 grams in a troy ounce. Most precious metals are sold in bars or coins typically ranging from 1 gram to 100 ounces and are stamped with the weight and purity (e.g. 1 Troy ounce, .999 fine).
How does the purity of precious metals in jewelry affect the value?
The purity and weight of jewelry made with precious metals affects the price you will get for your jewelry. The higher the purity, the higher the value. It is referred to in karats, 24 karat (24Kt.) being .99 pure or higher. 14Kt. gold is only .583 gold (14/24th pure). Platinum is commonly 0.850, 0.900 or 0.950 pure. Silver is usually sterling which is 0.925 pure. Remember, when the dealer weighs your scrap, it will be based on troy ounces (not the same as your scale at home).
Can you explain some things about coin collecting?
Collecting coins is a fascinating hobby for all ages. The study of coins is called numismatics. A coin is an excellent way to learn about history. But it is not a simple hobby because of all the factors that impact the value of each individual coin, from its history to its quality and scarcity. If you are considering starting a coin collection, here are some things to keep in mind.
First, learn some basics. Research is important for coin collectors. Thankfully, there are lots of books that can help you understand what you are buying or selling. It is important to collect what you like and discover as much as you can about a coin before acquiring it. You don’t need to have a lot of money to start. Check your pocket change for different dates and mint marks or different state and national park quarters. If you have inherited coins, or have received them as gifts, educate yourself on their background. Coins with certain dates and mint marks are rarer than others. These factors contribute to the value of a coin.
Knowing how a coin is graded, is essential if you collect coins. This system assigns a value based on the coin's condition. The grading process is pivotal. You could have the same two coins -- same year, same mint, same design -- and they could be worth drastically different prices based on the score they received when being graded by a reputable grading company such as PCGS, NGC or ANACS. Coins in near-perfect condition are very rare. So they are more valuable than worn or damaged coins.
Never clean your coins, novices are often tempted to polish their coins. Shinier coins must be more valuable, right? Cleaning or polishing a coin can destroy its value. It removes some of the original finish, rendering the coin far less valuable as a result. Real collectors prize coins that are as close to their original condition as possible.
Asking questions is the best way to learn and there are no stupid questions. Even long time collectors will have questions and need answers.
Should I only buy graded coins for investment purposes?
For older, collectible coins, the answer is yes. See the next answer for more on that. But for modern bullion coins, even proof strikes- NO! There are some firms that will try to tell you that if you are buying a Silver Eagle or a Gold Buffalo you should buy the slabbed and graded MS70 or PR69 because you know they are genuine and they are the most collectable because they are the best examples. They will be priced at a large premium over the price of the metal, and they may try to tell you that your purchase is guaranteed.
Modern bullion coins will all grade well due to precision equipment and techniques that result in much better quality than was possible even 40 years ago. These coins are overpriced, and when you go to sell them you will lose part of your investment, unless they have a guarantee, of course. Then you will only lose 10% of your investment, and they will sell that same overpriced coin to someone else. In reality, a high grade Gold Eagle is still a Gold Eagle. They are not rare. They are not exceptional. If you are selling graded bullion coins most coin dealers will only pay the same as for an ungraded coin.
What are the 1099B IRS Reporting Requirements?
We are often asked whether or not Missoula Gold & Silver Exchange's bullion transactions are "private". The privacy of our customers is one of our utmost concerns. When you buy from MGSE, there are no reporting requirements of any kind - no matter the quantity, the metal type, or the product. However, when it comes time to sell your products, the government does require bullion dealers to file reports where applicable. This IRS report is the 1099B form, and it applies to the following transactions:
1099B IRS Reporting Requirements
Reportable Item: Minimum Reportable Amount
Gold Bars: Any size bars totaling 1 Kilo (32.15 troy oz.) or more
Silver Bars: Any size bars totaling 1000 troy oz. or more
Platinum Bars: Any size bars totaling 25 troy oz. or more
Palladium Bars: Any size bars totaling 100 troy oz. or more
Gold 1oz. Maple Leaf: 25 1-oz. coins
Gold 1 oz. Krugerrand: 25 1-oz. coins
Gold 1oz. Mexican Onza: 25 1-oz. coins
U.S. 90% Silver Coins: Any combination of dimes, quarters, or half dollars totaling $1,000 face value or more
You might wonder why sales of these specific objects are reportable. These reporting requirements are related to the regulations that require brokers to report all proceeds from stock and commodity transactions. These specific objects are currently traded (or used to be traded) on commodity exchanges. Form 1099-B reporting requirements do not apply to any other coins. They do not apply at all to American Gold Eagles, American Buffalo, Austrian, Australian (Perth Mint Coins), Chinese or any fractional bullion gold coins. And they apply only if you sell at least the minimum quantity that is equal to the quantity of a commodity contract for the object.