The US Mint has reported an increase in sales of American Eagle silver coins for the month of May.
Compared to April, the sales in May has increased by 30%.
For the same period, the demand for American Eagle gold coins has fallen.
The total sales for American Eagle silver coins in term of volume is 3.65 million ounces.
According to the website of US Mint, the American Eagle bullion coins are priced based on the daily rate of gold, silver and platinum with a small premium to cover costs of production plus marketing.
Why do investors buy American Eagle silver coins?
The likely reason is the price of gold puts most small investors off.
Many people want to diversify their portfolio, and holding physical assets is one method.
Another possible reason is to hedge against currency decline.
Most people can still afford to buy one or two coins every month.
As long as they save two dollars a day, they can afford one coin per month.
Where can you buy American Eagle silver coins?
If you have a lot of money, and can meet the minimum requirements of US Mint, you can buy direct.
However, you cannot buy as individual.
You must buy as a business owner. That means the company buys the products.
The US Mint is very stringent in the selection of Authorized Purchasers.
The Authorized Purchasers will resell the coins to the secondary retailers, who then sell the coins to the public.
The minimum order is 25,000 coins.
The US Mint charges a premium of $2 over silver spot rate to cover the expenses of minting and marketing the coins.
That means if the current silver price is $36, you would have to pay $38 for each coin.
By the time the American Eagle silver coins reach the mass market, the premium for the coins will be higher.
The US Mint has a list of dealers here.
http://www.usmint.gov/mint_programs/american_eagles/index.cfm?action=lookup
Is it wise to buy American Eagle silver coins?
The advantage of American Eagle silver coins is in its liquidity.
You can sell your collection in practically every part of the world.
The fact that there is just one price of silver means you can sell at the same price regardless of where you make the sale.
The disadvantage of owning American Eagle silver coins is the volatility of silver price.
If you check the historical chart of silver, you can find the commodity fluctuates between $4 and $50.
While there are many reports about the highest possible price, nobody can guarantee it.
Buyer Beware!
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