The relative scarcity of American Eagle silver bullion coins and 1-ounce silver rounds in recent weeks has left bullion investors and collectors searching for the metal. For whatever reason, these potential buyers usually overlook a well-known and traditional silver product.

Circulated pre-1965 U.S. silver dimes, quarter dollars and half dollars – widely known as "junk silver" for their lack of collector value or "90 percent silver" for their .900 fine silver alloy – has been a popular choice for precious metals investors since the 1960s. Several obvious advantages exist to this form of silver investing.

The old coins are universally recognized and easy to distinguish from their copper-nickel clad successors. No form of silver is more divisible or flexible.

Beginners often obtain a handful of silver dimes, while those with large budgets buy junk silver by the $1,000 face value bag, containing 715 ounces of silver. That figure is based on the original weight of Mint State coins minus 7 ounces (or 1 percent) for wear in circulation.

Although the math isn’t as simple as it is when buying silver rounds, calculating the per ounce cost of junk silver is not difficult. Typically sold at prices quoted as "times face (value)," the day's premium needs to be multiplied by $1.40 (the face value of 1 ounce of pre-1965 silver coins) to obtain the per ounce price.

To use a simple example, when junk silver is quoted at 10 times face, the buyer would pay $14 an ounce. In the past, junk silver has often sold at premiums as high as 40 percent above the spot price of silver, but the situation is different today.

Even small buyers can now find pre-1965 silver coins at close to the daily spot price. Premiums are far lower than they are for silver American Eagles and privately minted 1-ounce silver rounds. Despite the shortages of 1-ounce pieces and the historically low price of junk silver, this form of the metal remains in plentiful supply.

A number of retail bullion dealers admit to being confused by the current state of the market. Even though the dealers recommend the cheaper junk silver that is available for immediate purchase, many customers prefer to wait for more expensive American Eagles and rounds that are out of stock.