This
week we will look at how to buy silver with a focus on the physical
products available. Just as in gold there are funds that are based on
silver. Buying in the stock market offers speed and accuracy but
lacks the actual possession. Here are some of the options for buying
physical silver.
The
United States makes one ounce American Silver Eagles and Canada
produces the Silver Maple Leafs. Other countries make silver products
as well, but in America these are the two most popular government
issued silver. Government products are popular as their weights and
tolerances are very exact and backed by the country producing them.
There
are a number of refineries that produce bullion products in silver
today in popular sizes such as 1, 10, and 100 ounce bars. These sizes
are sought after because of the ease in calculating the value of
these items. Roughly 1000 ounce bars are also produced for the Comex
market, but can be found in the open market as well. It should be
noted that 100 grams and kilos are popular in other countries that
use the metric system, and refineries have produced a host of
different sizes.
Older
refineries have produced odd weight silver. Rather than producing an
exact size piece they would pour bars at a rough size then weigh and
stamp them with the exact weight. An example would be a 101.56 ounce
bar rather than a 100 ounce piece. With the sophistication of
refineries today these bars are not nearly as popular.
Older
U.S. Silver coins are also popular for silver enthusiasts. Silver
coins produced in this country before 1965 were made with 90% silver
and many are sold for just their silver content. A common
misconception is that a $1,000 bag of old coins has that many ounces,
when in reality it only weighs about 795 ounces and contains roughly
715 ounces of silver. These are popular because they are actually
still money and easily recognized.
As
far as value is concerned the government produced pieces carry the
largest premiums. Old silver coins command a steady premium as the
pieces were made by an exacting government as well. The widest
variant in premiums can be found in refined bars. One ounce pieces
are produced by a host of regulated refineries and come in numerous
designs, but as you go up in size who made the bar becomes more
important. The two most popular refineries are JM (Johnson&Mathey)
and Englehard. When it comes to larger bars other brands can be
discounted much more heavily.
In
the late 70's and early 80's a host of 'homemade' bars flooded into
the market. Many of these were produced without regulation and may
not bring as much when being sold today. Oddly enough with the rise
in silver prices we are seeing this trend again. People are
manufacturing their own bars without regulation or registration. Be
careful of the silver you buy. If it comes from an unknown source it
may have to be re-refined again and thus the selling price for that
silver would be much less. It is our recommendation that you stick
with buying one of the many good known brands of silver.
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