How to Invest in Physical Silver

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Tip to invest in physical silver
Tip 101
Instead of buying and owning physical silver, you can think of making an investment via the stock market.

Silver investments have increased over the past few years as investors have learned and begun to consider this precious metal as a strong store of value, as well as a safer option. Its easy availability, varied use, and lower price with respect to gold make it one of the most preferred options for industries and investors, as well. Although this metal has what it takes to be a lucrative investment option, there are a number of factors that one should consider―factors that will help one to make a firm decision.

What’s the Aim?

First things first, no investor wants to lose his/her money. You do not want to end up spending in excess than needed on any physical form of silver. Plus, getting into scams of buying coins that are valuable for some collectors shouldn’t be your idea, whether you are spending less or more. The aim of purchasing this metal is to exchange or sell it to a company or individual at its weight value.

Weight and metal content of a piece of silver determine its true value, and you need to consider these two aspects while purchasing one. Apart from the value, even the price is based on weight, besides additional premiums.
Options Available

What kind of silver should one buy? Although there tends to be tremendous confusion in an investor’s mind regarding this question, there are some aspects that can lead to its answer. Your monthly budget, how much you are considering to invest in silver now (or over the next few years), whether it’s a short or long-term investment, whether it can be exchanged, whether you have side income, etc., are some factors that you need to take into account before making a decision.

Also, remember that every investor has to pay a small premium per sale, which is what the dealer earns. Any precious metal including silver is never sold at its spot price, i.e., its raw price. Regardless of what you are buying, this price entity will always come into the picture, and here are some options for the physical forms of silver that can be bought:

Silver Bars

These are a great option to invest in this precious metal. If your idea is of purchasing plenty of silver at low premium, this is a good way, where you can opt for 1,000 oz. (or plus) bars, apart from 1, 10, and 100 oz alternatives. 99.9% pure silver 100-oz bars are dominating the market these days. Buying in bulk implies saving on the spot price, and they can be bought in quantities that are considerably less inexpensive in comparison to coins or rounds. Although not backed by the government, these are great for the long term, provided that you can accumulate plenty of them.

Silver Coins

One of the most recommended options, they come with a guarantee of silver purity and weight as they are government-minted. They prove to be the most useful in an emergency situation as nobody can doubt the integrity of such a coin while exchanging or selling. However, they do carry premiums, but they are worth it owing to their very high reputation. Also, reduction in spot prices is prevalent when supplies increase.

Options are plentiful, and you can consider any of them as these coins can be traded worldwide, irrespective of your nation of residence. Here are some of them:

Country Coin
United States American Silver Eagle
Canada Canadian Maple Leaf
Austria Silver Vienna Philharmonic

Generally considered for trade, they are expensive. Thus, consider purchasing coins only if you have sufficient funds in order to add to your portfolio. Consider buying rounds and junk silver in larger quantities, which are comparatively cheaper in case you are low on funds.

Junk Silver

This is a great option for all. Junk silver refers to coins that were minted before 1964 and so named, as these coins contained 90% silver. Although advantageous, they are often neglected by novice investors, who rather consider buying bars or coins. Although the latter is an excellent choice, junk silver is not far behind as it is easy to trade and carries lowest premium. It is cheaper than bars and should be purchased in some amount to get silver in larger quantities with less investment. Dimes, half dollars, and quarters, as well as World War II-era nickels can be considered junk silver in the US.

Silver Rounds

This is another good alternative that you can purchase significantly without spending much. Although they resemble coins, they differ in terms of minting; they are privately minted, and governments play no role in it. Although they can be accumulated for less, they are not considered legal tender. Of course, you can sell or exchange them for cash or any other purpose, but cannot consider the same for paying private or public debts as it is illegal.

Also, as they are not government-backed, they are difficult to trade comparatively; however, this does not mean that their value is less than that of coins. Of course, the latter serves as a less risky option owing to its reputation, especially in a financial crisis. The purity of silver rounds, however, can be verified with some testing methods.

Trustworthy Dealers

Opting for pure silver with 99.9% purity is your idea, and this is where you need to be careful. Of course, there are trustworthy/authorized dealers, but beware of those scammers on different sites/platforms, who sell fake silver and serve the intended purpose of making a quick buck quite easily. Purchasing from a reputable dealer means that your silver is pure. Here are some options:

APMEX

One of the most trusted dealers, this is a good option for those intending towards purchasing bullion in any form.

Kitco

A Canadian company, it deals in buying and selling of precious metals like gold, silver, and copper. It shares information related to trends in metal prices along with viewpoints and expertise of other investors from all across the globe.

BullionVault

A UK-based dealer, it allows the exchange of gold and silver bullion online. In fact, it also facilitates investors to keep their purchases safe in vaults, with no restrictions on selling or withdrawing them at any time.

Regardless of your decision with which option to consider, the next point of focus should be the kind of silver to consider for buying. Also, you can buy it on eBay or Craigslist that can provide you with some good deals, but be safe and proceed cautiously if you have made up your mind considering all the factors, positive and negative.

In the End

After analyzing all these aspects, it should be clear as to which option can go your way. Of course, which one to consider will totally depend on your priorities. If you want to invest in the cheapest silver for less, which you can as well trade in tight economic conditions, you can go for junk silver. With plenty of benefits, the purchase of coins is advisable if you are not low on funds. Bars, again a good option, are worth considering if you want to enhance your portfolio and have sufficient investment funds for the same.

Thus, all in all, this precious metal provides you with several options to add to your investment portfolio. Silver serves those investors in the best way, who do not have decent investment funds while providing them with necessarily high returns on trading.

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