While silver is silver, regardless of the size and the condition of silver bars, most of us still prefer to keep shiny and beautiful silver bars.
The best is to have newly minted items.
1 oz silver bars are generally nicer looking than 100 oz silver bars. Hardly anyone wants to buy 1000 oz silver bars.
The cost of a single bullion is prohibiting.
Most people buy 1 oz silver bars for aesthetic purpose, on top of investment purpose.
Why should you consider buying 1 oz silver bars?
For one thing, the price is lower than other size.
If you are a student with extra income from online sources, or you want to start small in precious metal investing, you can start to buy one or two 1 oz silver bars per month.
In this way, you are using the dollar cost averaging method to build up your holdings.
Over the long run, the average cost of your collection will still be lower than the peak of silver price.
As long as you keep track on daily price movement, you can buy nearer the lowest point in a month.
Many sellers are offering free shipping for 1 oz silver bars too.
One of these is Scottsdale Silver. Free shipping is available for this size and for purchase over $500.
That is a great way to build up a collection of precious metals.
Silver Towne has similar free shipping items.
However, if you are not staying in the United States, you should avoid buying a single 1 oz silver bar online.
The shipping cost will eat into your investment.
If you like this size better than the larger version, you can buy 20 or 30 such bullions.
The average shipping cost per bullion should not cost more than 5% of the purchase price. If the average shipping cost is more than that, you would have to wait longer to sell off your collection.
If you want to buy locally, and you want newly minted item, make sure you find a reputable reseller in your region.
The premium over spot for bullion bar is usually lower than that for bullion coin.
Some pure silver coins are legal tender. But that is not so with bullion bars.
You cannot use the silver bars to buy a sack of rice for your family.
Another good reason for buying the smallest size pure silver is for giving to family members.
This can help your family members to start investing as well.
When they see how beautiful the 1 oz silver bar is, they may tempt to invest in it.
You can encourage them to start a collection of different 1 oz silver bars.
There are so many brands out there.
Even if you make it a point to have one each of every brand, you need to fork out quite a bit of money.
Some famous brands, such as Engelhard, have so many different designs for a size.
Smaller sizes are easier to liquidate too.
It is relatively easy to sell off your collection of 1 oz, 5 ox and 10 oz silver bars.
It is not that easy to sell off 100 oz or 1000 oz silver bars. Not many collectors can afford the price.
The price of silver will likely increase due to inflation risk and unrest around the world.
The price of gold and silver increase so much in recent years, because the US government devalues the currency so much.
It is a good investment choice for the foreseeable future.
Monday, June 27, 2011
Tuesday, June 21, 2011
5 oz silver bar
I received an email from Scottsdale Silver last night.
It was in regards to the release of 5 oz silver bar.
While Scottsdale Silver has a selection of silver bullion of size 1 oz, 10 oz and 100 oz, this is the first time that 5 oz size is available.
The email goes:
“The Scottsdale Silver 5 oz PREY BAR is not yet available to the general public, however - as a preferred member you get a sneak peek at the pictures and option to purchase before others!
These highly anticipated pure silver bars are Scottsdale's first 5 oz bar. They're in stock now and ready to ship to our members!
http://store.scottsdalesilver.com/product/44/5-oz-Silver-Prey-Bar-by-Scottsdale-Silver
(This new product will not show up on the general product page, you'll need use this link)
Current Offers:
~ $6.50 Shipping w/ insurance
~ FREE Shipping on orders of $500 and above
~ No Extra Fees for using Credit Cards/Paypal”
This 5 oz silver bar looks nice. Just too bad that the free shipping offer is available to residents in the United States.
If only free shipping is available for international buyers, I would not have hesitated to buy a few 5 oz silver bars.
At a time when silver spot rate is relatively low, it is a good investment opportunity to stock on different bullion bars.
It was in regards to the release of 5 oz silver bar.
While Scottsdale Silver has a selection of silver bullion of size 1 oz, 10 oz and 100 oz, this is the first time that 5 oz size is available.
The email goes:
“The Scottsdale Silver 5 oz PREY BAR is not yet available to the general public, however - as a preferred member you get a sneak peek at the pictures and option to purchase before others!
These highly anticipated pure silver bars are Scottsdale's first 5 oz bar. They're in stock now and ready to ship to our members!
http://store.scottsdalesilver.com/product/44/5-oz-Silver-Prey-Bar-by-Scottsdale-Silver
(This new product will not show up on the general product page, you'll need use this link)
Current Offers:
~ $6.50 Shipping w/ insurance
~ FREE Shipping on orders of $500 and above
~ No Extra Fees for using Credit Cards/Paypal”
This 5 oz silver bar looks nice. Just too bad that the free shipping offer is available to residents in the United States.
If only free shipping is available for international buyers, I would not have hesitated to buy a few 5 oz silver bars.
At a time when silver spot rate is relatively low, it is a good investment opportunity to stock on different bullion bars.
Monday, June 13, 2011
Silver ETF - SLV
Many people have considered different ways of investing in silver.
One popular way is through Silver ETF, particularly the SLV.
Before we talk about the pros and cons, let us understand the term.
What is ETF?
ETF stands for Exchange Traded Fund. Silver ETF means this particular fund aims to track the spot price of silver.
What is SLV?
SLV refers to iShares Silver Trust.
Ishares Silver Trust has the largest holding of physical silver, and this particular ETF trades on the New York Stock Exchange.
What are the advantages of trading Silver ETF, SLV?
The first advantage is the ease of buying and selling.
Since SLV, the most popular silver ETF, is traded on the NYSE, you can just buy and sell as long as you have trading account.
Even if you are not a resident of US, you can open a trading account with your local brokerage firm.
Your local broker may charge a monthly custodian fee for holding the shares for you.
You do not have to advertise online for selling, and you do not have to arrange for shipping as for selling physical products.
The second advantage is the low transaction cost.
You do not have to pay a high premium, such as those for physical silver bullions and coins.
You have to pay one transaction fee for buying, and another for selling.
The third advantage is that you do not have to hold physical silver.
The silver ETF, in this case, SLV holds the physical silver. You are paying for a part of the large silver holding.
The last advantage is that you can make quick gain from the volatility of silver price. Once you notice the price of silver crashing, you can offload your silver holding immediately.
What are the disadvantages of trading Silver ETF, SLV?
The first disadvantage is the cost factor.
Once you compare the spot rate of silver per Troy ounce, and the trading price of SLV, you will notice that the trading price for SLV is lower than the current silver price.
Why is it so?
Bear in mind that Silver ETF is a fund, with its expenses like other major mutual funds.
The lower price is to discount for the operating and other expenses of SLV.
The second disadvantage is the transparency of the management of the fund.
Silver ETF is not under the same stringent regulation as most mutual funds.
There is a complicated sponsor, trustee and custodian arrangement for the management of SLV. While this arrangement is meant to ensure transparency, it muddles the water.
The custodian of SLV is JPMorgan Chase Bank.
However, JPMorgan Chase Bank could have many agents and sub-custodians.
They do not need to report the agents and sub-custodians to the investors.
The sad fact is that silver ETF is not under stringent regulatory requirements. The retail investors may never know the shady dealings unless a large scandal comes into light.
The third disadvantage is that silver ETF is not the same as silver investing.
The retail investors will never have a chance to get the physical silver, even if SLV liquidates its holding.
The only way you can get the physical silver is as a member bank of LBMA (London Bullion Members Association).
That means from the time you buy shares of SLV, the largest Silver ETF, you can trading paper assets. You are not investing in commodity. You gain from the price speculation, and you lose from the price speculation.
The last disadvantage for international investors is the custodian cost, and other related cost.
If you intend to hold silver for a long time, trading Silver ETF, SLV, is not a good choice. The custodian fee alone can reduce your profit margin in the long term.
You are better off buying silver bullions or silver coins.
Is silver ETF, SLV worth investing?
If you are looking into building up a diversified portfolio, you can park part of your cash in SLV.
If you are looking seriously in silver investing, you are better off with physical silver that you can pass down through the generation.
The risk of SLV liquidation is a real risk.
The management of SLV has never intended it for long term
One popular way is through Silver ETF, particularly the SLV.
Before we talk about the pros and cons, let us understand the term.
What is ETF?
ETF stands for Exchange Traded Fund. Silver ETF means this particular fund aims to track the spot price of silver.
What is SLV?
SLV refers to iShares Silver Trust.
Ishares Silver Trust has the largest holding of physical silver, and this particular ETF trades on the New York Stock Exchange.
What are the advantages of trading Silver ETF, SLV?
The first advantage is the ease of buying and selling.
Since SLV, the most popular silver ETF, is traded on the NYSE, you can just buy and sell as long as you have trading account.
Even if you are not a resident of US, you can open a trading account with your local brokerage firm.
Your local broker may charge a monthly custodian fee for holding the shares for you.
You do not have to advertise online for selling, and you do not have to arrange for shipping as for selling physical products.
The second advantage is the low transaction cost.
You do not have to pay a high premium, such as those for physical silver bullions and coins.
You have to pay one transaction fee for buying, and another for selling.
The third advantage is that you do not have to hold physical silver.
The silver ETF, in this case, SLV holds the physical silver. You are paying for a part of the large silver holding.
The last advantage is that you can make quick gain from the volatility of silver price. Once you notice the price of silver crashing, you can offload your silver holding immediately.
What are the disadvantages of trading Silver ETF, SLV?
The first disadvantage is the cost factor.
Once you compare the spot rate of silver per Troy ounce, and the trading price of SLV, you will notice that the trading price for SLV is lower than the current silver price.
Why is it so?
Bear in mind that Silver ETF is a fund, with its expenses like other major mutual funds.
The lower price is to discount for the operating and other expenses of SLV.
The second disadvantage is the transparency of the management of the fund.
Silver ETF is not under the same stringent regulation as most mutual funds.
There is a complicated sponsor, trustee and custodian arrangement for the management of SLV. While this arrangement is meant to ensure transparency, it muddles the water.
The custodian of SLV is JPMorgan Chase Bank.
However, JPMorgan Chase Bank could have many agents and sub-custodians.
They do not need to report the agents and sub-custodians to the investors.
The sad fact is that silver ETF is not under stringent regulatory requirements. The retail investors may never know the shady dealings unless a large scandal comes into light.
The third disadvantage is that silver ETF is not the same as silver investing.
The retail investors will never have a chance to get the physical silver, even if SLV liquidates its holding.
The only way you can get the physical silver is as a member bank of LBMA (London Bullion Members Association).
That means from the time you buy shares of SLV, the largest Silver ETF, you can trading paper assets. You are not investing in commodity. You gain from the price speculation, and you lose from the price speculation.
The last disadvantage for international investors is the custodian cost, and other related cost.
If you intend to hold silver for a long time, trading Silver ETF, SLV, is not a good choice. The custodian fee alone can reduce your profit margin in the long term.
You are better off buying silver bullions or silver coins.
Is silver ETF, SLV worth investing?
If you are looking into building up a diversified portfolio, you can park part of your cash in SLV.
If you are looking seriously in silver investing, you are better off with physical silver that you can pass down through the generation.
The risk of SLV liquidation is a real risk.
The management of SLV has never intended it for long term
Saturday, June 4, 2011
Is US going to print money again?
It seems that the way US government manages US economy is to print money.
The US is definitely using this method to devalue its currency.
As a result, the price of gold and silver rockets, but the economy is still not in a good shape.
The job data released on Friday is a great disappointment in many ways.
If US government hopes that manufacturing sector can add more jobs, and bring the economy to full employment, the job data is definitely a disappointment.
Devaluing the currency by printing more money does not work that well.
Is US going to print more money again?
Hopefully not.
While letting the currency appreciates is not a good idea, letting the currency devalue further is an even worse idea.
A weaker dollar means more speculation in precious metals, particularly gold price.
When the people see that the value of their money in the bank devalues, they are more likely to look for opportunities to make more money.
That desire often leads to disastrous ending.
For those who are jobless, a lower currency means imported goods are more expensive. If they have not much savings, paying more for basic necessities is definitely unwelcome.
A mass of unhappy and desperate people can trigger a political crisis. Just as well that US presidential election is near.
President Obama does not seem to have a first clue about managing economy.
Instead of cutting expenses on unnecessary spending, the government cuts job. A loss of 29,000 jobs in public sector is part of the reason for the dismal job data.
The government should add more jobs in public sector, instead of cutting jobs.
If the government stops waging wars overseas, and cuts on business expenses, such as business trips and other expense claims, that will save many jobs.
If President Obama is really committed to reducing debt, he should opt for $1 a year salary. Cutting his salary alone can save a few jobs.
US printing money is not the best method to save the economy.
If US is going to print more money, what can the rest of the world do?
Many investors react by buying gold to hedge against the declining US dollar.
That is a normal and logical reaction.
Having said that, there is a risk of gold bubble bursting in the near future.
Once the US economy shows sign of improvement, and the interest rate increases, the gold bubble may burst.
Let buyer beware. If you want to buy gold and silver to hedge against the declining USD, make sure you can exit before the crash.
The US is definitely using this method to devalue its currency.
As a result, the price of gold and silver rockets, but the economy is still not in a good shape.
The job data released on Friday is a great disappointment in many ways.
If US government hopes that manufacturing sector can add more jobs, and bring the economy to full employment, the job data is definitely a disappointment.
Devaluing the currency by printing more money does not work that well.
Is US going to print more money again?
Hopefully not.
While letting the currency appreciates is not a good idea, letting the currency devalue further is an even worse idea.
A weaker dollar means more speculation in precious metals, particularly gold price.
When the people see that the value of their money in the bank devalues, they are more likely to look for opportunities to make more money.
That desire often leads to disastrous ending.
For those who are jobless, a lower currency means imported goods are more expensive. If they have not much savings, paying more for basic necessities is definitely unwelcome.
A mass of unhappy and desperate people can trigger a political crisis. Just as well that US presidential election is near.
President Obama does not seem to have a first clue about managing economy.
Instead of cutting expenses on unnecessary spending, the government cuts job. A loss of 29,000 jobs in public sector is part of the reason for the dismal job data.
The government should add more jobs in public sector, instead of cutting jobs.
If the government stops waging wars overseas, and cuts on business expenses, such as business trips and other expense claims, that will save many jobs.
If President Obama is really committed to reducing debt, he should opt for $1 a year salary. Cutting his salary alone can save a few jobs.
US printing money is not the best method to save the economy.
If US is going to print more money, what can the rest of the world do?
Many investors react by buying gold to hedge against the declining US dollar.
That is a normal and logical reaction.
Having said that, there is a risk of gold bubble bursting in the near future.
Once the US economy shows sign of improvement, and the interest rate increases, the gold bubble may burst.
Let buyer beware. If you want to buy gold and silver to hedge against the declining USD, make sure you can exit before the crash.
Labels:
Precious metals investing
Thursday, June 2, 2011
American Eagle silver coins
There is an increase in demand for American Eagle silver coins.
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!
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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