A man was “stunned” to discover that a coin given as a toy by his grandfather is now worth between £200,000 and £250,000.

The five guinea gold coin, a Queen Anne Vigo, will be up for sale at Boningtons’ auctioneers in Epping on November 16.

The rare item is one of only 20 made from 7.5lbs of gold seized from Spanish treasure ships by the British navy in Vigo Bay, northern Spain, in October 1702.

The coin has been consigned by the anonymous man from Bishop’s Stortford, Hertfordshire, who was given it when he was a child.

He had no idea of its value until he showed it to Boningtons’ coin specialist Gregory Tong, who instantly recognised it as one of 15 highly sought-after remaining Vigos.

The man said: “My grandad had travelled all over the world during his working life and had collected many coins from the various countries he had been.

“He gave me bags of coins to play with – I was into pirate treasure – throughout my early years… as time passed these coins went back into bags and boxes and were forgotten about until I rediscovered them after my grandad passed away.

“I looked back through the coins, remembering the stories I made up about them when I was small, and then gave them to my own son to play with and put into his own treasure box.

“My little boy has been playing with this coin as I did all those years ago.”

The gold was seized from Franco-Spanish treasure ships returning from America, after the British fleet failed to take Cadiz during the War of the Spanish Succession.

The coins were made in 1703 to detract attention from the military failure, and were delivered with full pageantry through London to the Royal Mint by the Master of the Mint, Sir Isaac Newton.

The one for sale on November 16 is only the sixth example in the last 50 years, and is expected to break Boningtons’ house record of £200,000 set by the sale of a painting by Sir Winston Churchill earlier this year.