Why Buy Silver
Silver is often chosen as an investment vehicle because it is a physical means of storing of wealth. As a tangible asset, it can function as
a “safe haven,” meaning it retains its value better than paper money in the event of an economic disruption or political instability. For this
reason, it has proven over time to be a viable hedge against the effects of inflation on the dollar. Moreover, silver offers investors a
way to diversify their financial portfolio by adding precious metals to their holdings, which may only include stocks, bonds and other paper
Current trends in the silver market also point toward its potential appreciation as an asset. Natural deposits have been significantly depleted,
and the government stockpile of silver has since been exhausted. (The U.S. government now buys its silver on the open market.) Taking into account
its numerous industrial uses, it becomes apparent that demand remains high as it increasingly becomes scarce. Many believe that this
trend could represent an opportunity to invest before prices rise.
Due to its low price relative to gold, platinum and palladium, silver lends itself to being purchased in larger quantities. The more affordable
price attracts investors who want to procure a significant amount of precious metal at once, perhaps even in the form of a ten kilo coin. At the
same time, the buyer interested in holding their silver in many small denominations, possibly in preparation for using them as a barter
currency, can do so at an affordable cost. Even the return-oriented investor may want to keep their precious metals in smaller sizes, affording them
the freedom to sell only a portion of their reserves at a time. Silver is a commodity that appeals to the majority of investors because it
can be obtained on almost any budget.
Silver is sold in coins, bars, and rounds, each of which come in several different sizes.
Buy Silver Coins
Coins are a very popular form of silver and are widely traded among both collectors and investors. Silver coins must be government-issued
legal tender that are inscribed with the year of issue and conform to exact specifications of weight, purity, size and design. This standardization
gives collectors and investors the peace of mind that their precious metal is authentic, and also ensures that their bullion will be readily recognized and more easily
exchanged. These silver coins come with the added security that their precious metal content is backed by the full faith and credit of the government
which minted them.
In addition, silver coins sometimes obtain a numismatic value (or collectible value) above their intrinsic worth (or melt value). This collectible
premium may be due to low mintage for a particular issue, or high collector demand for a specific design. It is also influenced by the condition of
the coin. Since most silver bullion coins are initially sold near the spot price, an astute investor may see returns on a collectible bullion coin
that are higher than the price change in its underlying precious metal content. You need not be a financial mogul to buy silver coins. They can also
be collected for the enjoyment of the hobby and the beauty of the designs.
“Junk silver” is probably the most inexpensive means for accumulating silver coins. These are old, worn coins that have no numismatic appeal, but are
still composed of 90% silver because they were minted before 1965 when dimes, quarters and half dollars in circulation were still minted with silver.
These non-collectibles are sold very close to the price of their metallic content and often come in large bags containing a mixture of
dimes, quarters and half dollars.
Buy Silver Bars
Silver bars are sold solely for their precious metal content rather than any historical or collectible value. Bars are typically 0.999 fine, or
99.9% pure. They are produced by a number of private refineries, and are either individually cast or minted in large sheets and then cut. A variety
of sizes are available, depending on the refiner, usually ranging from one troy ounce to 1,000 troy ounces. Regardless of size, silver bars maintain
the high level of purity mentioned above.
Like many products, bars are manufactured by generic as well as name brand refiners. Industry leaders such as PAMP Suisse, Johnson Matthey and Engelhard are considered
name brands, and can command slightly higher prices on the secondary market. However, compared to other forms of precious metals, bars usually offer the
lowest premiums over the intrinsic worth of the metal content. Further, the larger the size and quantity of silver bars you buy, the lower the premium
per ounce you pay in general due to the economies of scale enjoyed by the major refineries. This makes bars an attractive option for the cost-conscious
Although they are not quite as recognizable as silver coins, bars usually have their weight and purity stamped directly on the bar. As an added
assurance, some silver bars even come with an assay card, or a certificate of authenticity from the refinery that verifies the weight and fineness of the bar.
The assay card generally includes a serial number that accompanies each discrete bar for purposes of identification.
Buy Silver Rounds
While rounds are similar in appearance to coins, there are many differences between the two. Rounds are not legal tender issued by government mints.
Instead, they are purchased for their bullion value in the same manner as bars. Rounds are likewise produced only by
private mints and often bear inscriptions of their weight and purity. If they are also ISO certified or accredited as “Good Delivery” by COMEX/NYMEX, 99.9% pure silver
rounds and bars are eligible for inclusion in an Individual Retirement Account, or IRA. Some non-accredited silver bullion may also be included but rules
for their inclusion varies with each IRA custodian.
Not only are rounds shaped like coins, but they sometimes carry classic designs that are also found on actual coins. This can certainly add to the
confusion. As a rule of thumb, if the piece in question lacks a face value denomination, then it is a round. Popular silver rounds, such
as those from the Sunshine Mint, may have original, artistic designs. They are made in a wide variety of sizes, down to as small as 1/20 of an ounce. This
affords the buyer a great deal of flexibility to trade, invest, or liquidate their silver incrementally as they see fit. Especially among investors and
traders, rounds are exchanged for their bullion value all over the world.
Buying Silver Guide
All of the forms of silver mentioned above can be bought conveniently and securely online, through one of our professional customer service representatives over the phone,
or in person at our showroom. At Gainesville Coins, we are always willing to assist you in making the right precious metal purchase. Choosing which
option best suits your needs depends on your investment goals and perhaps your personal taste. Bars and rounds are generally less costly, but have
less potential for acquiring collectible value the way many coins do. On the other hand, bars and rounds can have a higher liquidity than
coins, which make them an attractive low cost option.
As a note, some coins may be graded by the Numismatic Guaranty Corporation (NGC) or the Professional Coin Grading Service (PCGS). Graded coins
are encapsulated in a protective casing (referred to as a “slab” in the industry) and typically come with higher premiums; however, they oftentimes fetch
better prices in the marketplace because they have been certified for their condition and are well-protected.
To learn more about purchasing silver, visit our Learning Center.
Silver Bullion Release
New silver bullion items are released each year by the major state mints. 2013 was a year filled with high mintage figures and ambitious new design motifs.
Review of some popular bullion for 2013:
- The American Silver Eagle, the official silver bullion coin of the U.S. Mint, shattered annual records with over 42,675,000 coins sold.
- For the first time since its inception in 1983, the Chinese Silver Panda coin featured three Pandas on the reverse design.
- Falling short of their high-water mark of 2011, the 5 oz America the Beautiful silver coins saw mintage increases over the previous year.
- Both the Perth Mint of Australia and the Central Mint of China experimented with beautifully artistic High Relief engravings on silver bullion coins.
- The Canadian Silver Maple Leaf commemorated its 25th anniversary with a special-issue reverse design.
- The U.S. Mint introduced the Enhanced Finish design of the Silver Eagle, the program's first new variety since Reverse Proof and Burnished Uncirculated versions debuted in 2006.
Gainesville Coins carries a wide variety of modern silver bullion. Many 2014 issues are also now available for pre-order.