Congratulations on starting your journey with precious metals! Whether you have already purchased your collection’s inaugural piece or are still conducting preliminary research, you’ve probably realized that the field comes with a language entirely of its own. And that’s part of the fun of numismatics.
So, let’s start there. According to the free, online glossary we offer at Rosland Capital, “numismatics” is defined as “the study and collection of paper money, coins, and medals.” In turn, the phrase “numismatist” refers to an individual participating in numismatics, which may include, but is not limited to, hobbyists, collectors, or specialists.
If you consider yourself to be a numismatist (or are aspiring to be one), keep reading for definitions of some of the most common terms and phrases used in the industry.
Terms Related to Sourcing & Production
The lifecycle of a precious metal coin begins with extracting and processing the raw material. Some terms you may have heard of include virgin and urban mining, but there are also many other sourcing techniques that have been developed as a result of improvements and advancements in technology and an emphasis on sustainability. For example, there is precious metal refining, recycling, and electrolysis.
For the average numismatist, it is not necessary to know about or understand each of these processes in great detail. But familiarizing yourself with some general definitions related to production can help you navigate industry conversations or better understand different articles and publications that you read. Some terms worth familiarizing yourself with include:
- Alloy: “A mixture of two or more metals, such as bronze (copper and tin) combined to result in a product with qualities of each individual metal, such as greater strength or resistance to corrosion.”
- Clad Coinage: “Coins that have a core and outer layer made of different metals. Since 1965, all circulating U.S. dimes, quarters, half dollars, and dollars have been clad.”
- Annealing: “Heating blanks in a furnace to soften the metal.”
- Planchet: “The blank piece of metal on which a coin design is stamped.”
- Die: “A piece of metal that has the coin’s design (pictures, value, and mottoes) which is used to stamp the image onto the coin. The coining press holds both the front and back dies.”
- Mint: “Establishment in which coins are produced.“
- Mint Mark: “Mark on a coin identifying the mint at which it was struck.”
- Strike: “The process of stamping a coin planchet with a design. The strength of the imprint – full, average, or weak – affects the value of rare coins.”
Terms Related to Coin Design
Once raw materials are sourced and production ramps up, one of the most exciting aspects of coin ideation comes into play: designing the coin. Creativity, craftsmanship, and attention to detail all go into creating the obverse (“‘heads side of a coin”) and reverse (“‘tails side of a coin”). Sculptors, designers, and engravers often have the difficult task of appealing to the masses, blending modern and traditional themes, and incorporating aspects that many of us may not think about, such as coin security.
As you find pieces that aesthetically appeal to you and ones that you’d like to add to your collection, try to incorporate these phrases into your vocabulary:
- Bust: “A portrait on a coin, usually including the head, neck and upper shoulders.”
- Field: “The portion of a coin’s surface not used for design or inscription.”
- Edge: “The outer border of a coin, considered the ‘third side’ (not to be confused with ‘rim’). Some coins feature lettering, reeding, or ornamental designs on their edges.”
- Rim: “The raised edge on both sides of a coin (created by the upsetting mill) that helps protect the coin’s design from wear.”
- Incuse: “Descriptive of an impression that cuts into the surface of a coin.”
- Relief: “Raised parts of the design.”
- Inscription: “Words stamped on a coin or medal.”
- Pattern: “Design piece prepared by a mint for approval by the issuing authority, not actually put into production. Patterns may differ from issued coins in metal or minor details, but many bear designs quite different from those eventually adopted.”
Terms Related to Coin Collecting
Once a coin is finalized, it’s ready to be enjoyed by the public. A special element of numismatics is the expectation that once a coin hits the market, it will continue to be bought, sold, traded and hopefully celebrated by future generations. These future numismatists may collect these mementos in mint sets (“a complete set of coins of each denomination produced by a particular mint”), type sets (“a collection of coins based on denomination”), or year sets (“a collection of all coins issued by a country for any one year”).
Whichever type of collection you prefer to own, here are a few practical definitions to know:
- Bullion: “Precious metal whose value is reckoned solely by its weight and fineness.”
- Intrinsic Value (Bullion Value): “Current market value of the precious metal in a coin.”
- Face Value: “The sum for which a coin can be spent or exchanged (a dime’s face value is 10¢) as opposed to its collector or precious metal value.”
- Mint State: “A description applied to certain coins graded according to the Sheldon Scale, where the coin is considered to be in the same state or condition as when the mint struck the coin.”
- Business Strike: “A coin intended for circulation and monetary transactions (as opposed to a proof coin specially made for collectors).”
- Proof: “A specially produced coin made from highly polished planchets and dies and often struck more than once to accent the design. Proof coins receive the highest quality strike possible and can be distinguished by their mirror-like background and frosted foreground.”
- Spot Price: “The cost of gold and other precious metals at the current moment rather than a date in the future or the past. Spot prices are tied to the weight of precious metals and are usually quoted in USD.”
Additional Resources
By familiarizing yourself with common terms, phrases, and definitions, you are well on your way to becoming an educated and informed numismatist. If you’re looking for additional ways to build a solid foundation for your future in numismatics, explore our supplementary resources at Buy Gold 101, Rosland Capital Gold, and Rosland Capital IRA.
Additionally, you can read up on coin collecting tips for beginners here.