[youtube]http://www.youtube.com/watch?v=D-RoGJStKFs[/youtube] Cliffs: How do Premiums correlate to spot prices?
Hey Mowa Cool way to ask a question. Premium is never set unfortunately. In your example you give is a "Sold Out" Snake this is different than say a Canadian Maple that is still available The Snakes premium is going to be made up by "demand" for the product. So while you have the Manufacturing costs As example using $31 spot and $8 production costs = $39 as example Now these get "Sold out" but hang on everyone still wants them, so their is a stronger demand. So Spot is still $39 - PC $8 - Demand ? This could be an extra $10 - $1,000 + depending on the item. You mentioned semi numis and this is where the premium is unknown now. If the spot went to $62 (double) there is no guarantee that the premium would double, if spot doubled. However if you still had the demand you would likely have an even larger spread than what you do know, as more people would probably be in Silver at that price. The key is this is semi Numis throw out a set premium. Another example - Canadian Maple (hypothetical) Spot $31 - Sell $39 so again we have an $8 spread If spot doubled to $62 Yes that premium should still only be $8 you will have discrepancies in currency conversion so it will never be 100% accurate, use it as a guide for your purchases. I am not sure if I truly answered your question but I appreciate your effort in the Video
IMHO, premium is not correlated to spot price, but instead correlated to demand. ie, premium demand = charge what the market will bear.
Just to give you an easy example Examine on the recent SBSS D&D coin... Due to the hype, now the current pricing is triple to the spot.
I'm not veteran Silver Stackers. However, the quoted price of silver is not including minting. A premium is for a coin, no one has, and someone wants.. Term premium applied to coins is a misnomer. It's what someone will pay. Coins are graded, very fine, fine, etc.
