Prices of premium coins Vs spot

[AndyMac]

Hi, I was hoping to pick the brains of more experienced stackers. When it comes to more premium coins, how do the prices of these tend to act when it's underlying metal's spot price peaks and troughs. Do they tend to hold they're price due to being more collector's items and generally more scarce? Or does the premium on the coin act like a multiplier over equivalent bullion coins? Thanks.

[Pete]

Generally the premium is more of an add-on and not a multiplier.
Say the premium is £10 for a coin and spot is £14 the coin might be priced at £24.
If spot increased to £25 then MAYBE ??!! the same coin would be priced around £35 and not £43

However, prices of semi numismatic and premium coins depends on the demand, scarcity and luck of the day.

[AndyMac]

That's really helpful thanks 👍.

[TeaTime]

In my opinion the 'value' of modern proof or numismatic coins is largely based on the issue price. Demand will then determine its after-market value.

If Colin buys a coin at £80 when the price of silver is £20 oz he is very likely not going to sell it for less than that if silver drops to £5 an ounce. Colin bought the coin on its artistic and aesthetic merits - the silver spot price means nothing to our Colin.

Two very different markets with a bit of cross-over. Collectors and Stackers.

[ChrisSilver]

The supply also affects premiums. If there is little supply of PM in the markets due to increased demand, e.g. often when prices suddenly fall or when prices suddenly rise and are at all time highs. Then premiums can increase as the lack of supply affects this.

Once the supply is more constant and the demand falls off, then premiums should drop.