Probably the most important thing other than the mongram/initials on it is the size and metal it's made of. It's definately not lead, because lead actually rots, and that looks corroded. Also, from the size it looks too small to be a cigar punch, and too small to be large fire arm related (unless perhaps it has something to do with flint locks or other powder loaded arms).
Is the part below the initaled flat piece round? If it is like it looks it could be some kind of a pin, and the initals/monogram could be someones name or their company name.
I'm not much up on fire arms pre-1900s, but I don't think it's a Colt product, because as far as I know Colt has always been Colt Industries, Inc. However, I could be totally wrong if Colt was Colt Indrusties Co. pre 1900s.
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