Casual investors looking for a recommendation on what type of silver to buy will often hear the same answer from a typical coin dealer, that being, “well Morgan Dollars, of course.” But sadly, accumulating these historic U.S. silver coins often ends up being a big mistake.
Morgan Silver Dollars were minted in the late 1800s and early 1900s, contain 90% silver (the rest is copper), and are considered to be semi-numismatic coins. They are not unlike many other so-called “rare” coins that we’ve been warning our customers to steer clear of. Just like the common early 1900s gold coins frequently peddled to unsuspecting buyers by rare coin shsysters, the spread between the buy and the sell prices on Morgan Silver Dollars is also awful, thanks to outrageous markups.
A number of tricks and deceptions are used to sell Morgan Silver Dollars (and Peace Silver Dollars)…
The Silver Content Deception
For example, the silver content is actually just a shade over three quarters of an ounce (.7732 troy ounces to be exact), but slick marketing materials often imply that these coins contain a full ounce of silver!
Here’s a typical sales pitch: “The price of silver is $30. If you call company XYZ today, you can buy Morgan Dollars for just $32 each.”
Sounds like a fair deal, right? Well, the Morgan Dollar melt value at that silver price is merely $23.20. What may have appeared to be a modest premium over the melt value (of just 7%) is nearly 38% in reality!