Silver as an investment?

[Nugget]

Over the last couple of years I have invested in (and sold) Silver in many forms, namely bullion, modern numismatics and jewellery. It's my personal opinion that Silver is undervalued and will someday reap decent returns for those in it for the long haul.

Silver is just that little more exciting to me than Gold, I think this is mainly due to Silvers volatility (OK, so I'm a bit of a risk taker at times ) and affordability, with affordability really being the key here.

At the current prices, $1400 will buy me 1/oz of Gold or 63/oz of Silver, if Silver shot up just $1, I would be up $63, but in saying that it can go the other way and often does.

I have plenty more to add to this topic and I'm really looking forward to hearing peoples thoughts on Silver as an investment, and I would love to hear from other Silver stackers / investors.

 

[Gold miner]

Mate,
I dunno, coz I'm a gold miner, and have a stupid one eyed view etc!!

I have a mate, over 20 years ago, Kevin from Mackay... he said the same, asked the same question as you have now!!
Anyway he started buying at a stupid price, and said he hoped for the day it would go off!
He has a serious disability, and his money really meant 'nothing' to him, so silver it was.....
I dunno!!!

http://www.silverinstitute.org/site/silver-price/silver-price-history/

 

[ChrisM]

Hi Nugget.
Gotta say that i share the same sentiment as you when it comes to silver.
I try to buy and stash silver bullion when i can. There are many schools of thought out there when it comes to silver as an investment. Some pro and some anti.
Personally I like the idea of an affordable "physical" alternative to the printed stuff.
It dosent have the same adrenalin rush when you're hunting for gold but it sure feels good in the palm of your hand....

 

[Nugget]

Absolutely ChrisM.

I actually purchased my detector and accessories with money I received from selling off some Silver bullion, and although I haven't found any Gold with it yet, I have been finding plenty of Silver :lol:

Ah yes, I'm very familiar with those bars, and the 1kg ones

 

[Ben78]

I got into detecting to find gold but in researching I discovered coins. Half Pennys and Pennys are just another brown bugger to me, silver is where it is at for me. I found significantly more silver in the last year than I did gold. Silver coins are as good as bullion and I love digging another one out.

I haven't really thought about buying fine bullion, where do you get it from? How do you not get ripped off?

 

[Scoopa]

Couldn't agree more nugget. I've been buying silver for a while now and even at todays price I've realised some nice profits.

 

[Nugget]

I haven't really thought about buying fine bullion, where do you get it from? How do you not get ripped off?

I mostly buy direct from the Perth Mint but have also purchased from ebay and other stackers.

Spotting fakes is fairly easy if you know what to look for. When buying on ebay I usually purchase bullion coins or bars that I already own, that way I have something to compare them to, and I only buy from one or two sellers that I completely trust.

The cheapest and easiest way to get into Silver investing is to start buying 1966 round 50 cent coins (80% Silver content), you can pick them up between $12 - $15 each. I sometimes put an add out in the local paper or post on local community Facebook pages mentioning that I buy them, doing it this way I've sometimes picked them up for much less which means I'm already in profit :lol:

 

[Brettgab]

Thanks for the tip on buying round 1966 50 cent pieces, I been thinking of how I could get some silver coins.
I got my son to buy some silver when it was around $16, I was watching the silver chart when silver was up around high forties. The chart had had a big run up so we went and sold it. We got lucky , the following week silver crashed.Now we are looking at buying back in since the price has come down quite a bit.

 

[SilverTongue]

I buy silver but I dont buy for investment purposes. There are two aspects to consider when buying silver. The first is why you want to buy it. Is it for an investment or is it to use as an alternative (like me) to fiat?

If you are buying for investment then your options are endless in the market place. Ie spot price of silver today is at around $19 per oz. Of course you cant buy it for that. Most dealers will put a markup on it so today the cheapest I have seen it is around $25 per oz. Thats for bars or rounds. The smaller the amount the higher the markup. Personally if I were investing in silver I would be buying the limited mintage coins from Perth Mint as the sell prices achieved are much greater than your normal bars or rounds. There are a number of reasons for this and one is the limited mintage, the other is the art which also include art bars and rounds. You get a much higher return on these items rather than sitting on basic bars and rounds hoping the spot price will go up. Thats a fairly basic view of it.

On the other hand if you are like me and are only interested in it for when TSHTF scenario then your basic bars and rounds at the lowest possible prices are your best option. After all, silver is silver.

I dont like anything with a face value on it and I prefer to buy 1oz rounds due to the fact they are easy to trade with. I also like to buy rounds that have an elegant (desirable) look so people are more likely to accept them as trade. I love the Scottsdale omnias and the new Aussie rounds, True Blue, both 1oz.

Silver coins are great if you can pick them up cheap enough. 3 of those 1966 50 cent pieces are the equivalent of 1 oz so I personally wouldnt be paying any more than 8 bucks or so for them but thats not to say they are not worth more. They are very collectable and people want them so will pay higher prices. Same goes for any other silver coin especially pre decimals. They demand a much higher price than the silver content is worth.

 

[kiwited]

Silver can be bought at Perth Mint today A$21.80, at this price it barely covers the cost of mining, smelting, storage, minting etc. Silver has been over $50 oz before and can be again. If silver turns to s&8t you stand to lose some of the $21? maybe $5?

If gold at A$1400 oz, drops a few percent, you can lose alot more per than $5. The other day it lost $70!

In terms of risk silver seems a better bet.

 

[Mr Sism]

G'day Nuggett, Jim Rogers has started buying silver again, pretty good endorsement. I've been a 'stacker' for several years now and buy a bit here & there, mostly in 1Kg bars as I want the most exposure I can get to the per ounce price if/when it goes to new highs .... Not interested in buying the limited edition couins and getting ripped off for silver content, the premium on these coins as a collectors item will likely be dwarfed by the worth of the silver itself. My preferred method of purchase is online at w w w.ainsliebullion.com.au (Queensland) you need to provide proof of identity with your first order but that is easy (a quick trip to the police station), delivery is always swift (2-3 business days to Melb') & spot-on, their premiums also appear to be the lowest I've seem. I tend to buy the perth mint bars (through Ainslie) as the ainslie bars are a little rough around the edges.

Cheers Drewe.

 

[SilverTongue]

G'day Nuggett, Jim Rogers has started buying silver again, pretty good endorsement. I've been a 'stacker' for several years now and buy a bit here & there, mostly in 1Kg bars as I want the most exposure I can get to the per ounce price if/when it goes to new highs .... Not interested in buying the limited edition couins and getting ripped off for silver content, the premium on these coins as a collectors item will likely be dwarfed by the worth of the silver itself. My preferred method of purchase is online at w w w.ainsliebullion.com.au (Queensland) you need to provide proof of identity with your first order but that is easy (a quick trip to the police station), delivery is always swift (2-3 business days to Melb') & spot-on, their premiums also appear to be the lowest I've seem. I tend to buy the perth mint bars (through Ainslie) as the ainslie bars are a little rough around the edges.

Cheers Drewe.

I agree with you there Mr Sism on the most exposure to the per ounce price . I have seen the ainsleibullion site but havent dealt with them before.

One of the advantages of a private wealth store is that no one knows you have it.
The current legislation in Australia in relation to private ownership of gold and silver only covers anti money laundering and onlyfor transactions over $5000 in any one transaction. The supply of verified ID is not required for the purchase of bullion in Australia and personally any business that requires it from me for transaction under this amount does not get my business. Bullion confiscation has long been a government tactic in gaining private wealth in times of crisis......For the good of the nation.....In most countries of the world.

Gold confiscation is an important issue that strategic investors need to have a view on the circumstances in which you are most likely to need your wealth safe haven is also when the risk of a Government wanting to take it away from you may be the highest.

The link is searchabel as I am unable to post it due to my members status.

Originally published in November 2008, Bron Suchecki's gold confiscation article is well researched and unique.
Rarely do we see an Australian perspective on this issue. Whilst I agree with the core hypothesis that legislative risks exists, I feel it is very unlikely gold will be confiscated in Australia FDR style. It is my contention that governments will attempt (and fail) to use more sophisticated and less obvious methods such as derivatives manipulation, Capital Gains Tax and price controls.
Given most of the gold held these days is in paper (i.e. futures, options, ETF's and stocks) the visions of government officials driving trucks from house to house to collect gold is ludicrous.

It is not ludicrous at all. First, most of the silver and gold held in paper is not important in the scheme of confiscation.....obviously! Since the Cypris bail in occurred more and more people are, investing in physical silver and gold because they dont trust our governments not to do the same.

The American government confiscated gold and silver in 1933 and banned private ownership and they will do it again in times of crisis. The current legislation is that the silver eagle is exempt for confiscation but consication legislation is still in place. The UK also did it, banning private citizens from owing any more than 4 gold coins.
http://www.24hgold.com/english/contributor.aspx?article=4151878734G10020&contributor=Adrian+Ash

There is no Australian Federal or State law that requires you to disclose your verified ID to purchase bullion unless it is over $5000. Businesses are entitled to ask for it but it is not a legal required of purchase. By handing it over you are opening yourself up to identity fraud or worse. If the company does not give you a copy of their in house privacy policy (they way the company handles, safe guards and disposes of your personal ID) for purchases over $5000 then to me thats a big red flag......

Bottom line is this.....if you want to keep your bullion, keep it anonymous!!!!

And, in terms of investment (physically holding) then that is not realized until you sell!

I hate to see people who dont know any better to be conned to hand over ID they are not required to by law.

 

[Mr Sism]

Perhaps Ainslie will sell bullion on smaller parcels without ID ......? Not sure ....... definately beats leaving your hard-earned in the bank (ID or not), be your own banker.

As I understand, in 1971 when Nixon abandoned the US gold standard (Bretton Woods) was that gold bullion was illegal to own and the government bought the bullion from the people (rather than outright confiscation). The big difference this time around is that this currency crisis is global (not just a US crisis) and any one country that declares gold ownership illegal will only achieve movement of funds (and lots of gold) offshore, this would be economic suicide for any nation (probably in keeping with our present governments track record though eh.).
Also, as this is a global crisis, the % rise in precious metals could be many times that experienced in the late 70's early 80's, bring it on!!.
Keep stacking Silvertongue. Drewe.