Silver can be sold as bullion, bars, or coins. The value of each is based on weight. Similar to when measuring gold, it is important to understand the difference between an ounce and a troy ounce of silver.
The chart below is the current New York 8-hour silver spot price PER OUNCE (quoted in US Dollars):
There are 28.35 grams in a common ounce, but 31.1 grams in a troy ounce. Thus, one common ounce of silver is equal to .911 troy ounces.
In general, when determining the value of silver, investors need to know the weight of the silver in troy ounces, as well as the amount of pure silver that is in the particular piece. For example, typically the purity of sterling silver is 92.5, or 0.925 pure. The purity should be multiplied by the current spot price of silver at that time. This calculation will reveal the value that the particular piece of silver is worth.
Some investors use a different measurement that entails a gold-silver ratio. This essentially determines the value of silver in comparison to gold whereby the average value for silver is based on a ratio to gold such as 40-1, or 16-1. The higher the ratio, the cheaper silver is per ounce in relation to gold.
Silver has been measured for many centuries and in its very early stages, this was done by computing the amount of oxygen in it. Today, similar to with gold, silver can be measured by the ounce, although the more common measurement is the troy ounce.
The value of silver may differ depending upon what form it is in. Silver bullion has been produced in a variety of forms, but one of the most convenient forms of silver is silver coins.
Coins such as half-dollars that were minted prior to 1965 are 90% silver. If in good condition or when rare, these coins can be valued well over silver prices per ounce by collectors because of their scarcity. Generally though, these coins are common in well used form are usually consisdered "junk silver" and as such sell at a very small premium over the silver per ounce price.
Another form of silver bullion, silver rounds, generally represents a 99.9 percent pure silver troy one ounce allotment. These types of coins typically sell at smaller percentage over the current prices of silver than coins such as the "American Eagle" or the "Canadian Maple Leaf" coins. The reason for this is that these coins are generally considered "junk" coins. Also, they usually hold no gaurentee of their purity by a major enity (such as a national government).
Silver bullion can also be purchased in bar form. These bars are typically uniform in size so they are easy to handle and to store. These bars are normally .999 percent pure, which is the industry standard.
Keeping these price differences in mind can be of great importance to an investor because even a small change in % cost over the spot price of silver can make a big difference in the cost of silver bars, coins, and rounds.