When people refer to the price of silver they are generally referring to what is called the silver spot price. In general, a spot price is the price of a commodity for immediate delivery. In the case of silver, it refers to raw silver before it refined to a pure form and minted into a coin or quality bar. While you cannot buy a refined pure coin or bar at spot price, the silver spot price is generally the basis for the pricing of your physical silver, at least for non-collector or non-numismatic coins.
While “spot price” refers to a price for immediate delivery, the silver spot price is actually calculated using silver futures contracts traded on global exchanges such as COMEX, NYMEX, London, Zurich, Shanghai, and Hong Kong. Sometimes the price is based on contracts with expiration months in advance. This is because the calculation is based on the forward month contract with the highest trading volume.
While there is always a silver contract expiring within 30-days, this contract may not always be the most actively traded contract, so a future month’s contract will be used as the silver spot price.
If you own bullion type silver coins (coins that trade primarily for their silver content), you can use the spot price of silver as a good indication of the price and value of your coins. If you own numismatic or rare silver coins, the spot price may give you little or no insight into the value of your holdings.
