Investing In Silver: How to Buy Silver Coins and Bars

Email

For investors who want to capture the coming move in silver, buying silver bars or coins is still one of the best options.

Here's why…

Like gold, investing in silver is a great hedge against inflation and financial turmoil alike. It's why demand for silver is increasing at an astonishing rate.

In fact, says Money Morning Global Investing Strategist Martin Hutchinson, "If silver were to match its 1980 peak, adjusted for inflation, it could climb as high as $150 an ounce."

For savvy investors who hold physical silver in bars or coins, that move would deliver roughly a 328% gain from today's spot-prices.

Investing in Silver Coins

Of the two, buying silver coins is a bit more challenging because there are so many different ways to purchase them – including rare coins.

But while rare collectible silver coins are often attractive and sometimes bring in big prices when sold, their value is quite subjective, as they are tied to a number of largely intangible factors like scarcity, wear and quality of appearance.

Rather than becoming a rare coin collector, most investors would be better off purchasing bullion coins if their intent is to ride the silver bull market.

The United States Mint produces several bullion coins in silver. The most popular is the one-ounce American Eagle, which can be purchased direct from the Mint in uncirculated condition.

At a recent price of $45.95, these coins sell at stiff premium to spot silver prices. But there's also a large aftermarket, where the coins trade at smaller premiums.

The same is true for the Mint's commemorative issues, such as the one-ounce 2012 Infantry Soldier Silver Dollar, recently priced at $44.95.

The Royal Canadian Mint also produces several silver bullion coins such as the half-ounce Year of the Dragon $10 coin. However, these coins also carry a similar premium when purchased directly from the Mint.

Despite the premiums, the guaranteed purity, beauty and liquid market have made U.S. Mint offerings highly popular. In 2011 alone, 39,868,500 ounces of silver were sold by the Mint.

How to Buy Silver Coins from a Dealer

All of these government-produced bullion coins are also offered by the major precious metals dealers, often at prices well below the original issue price.

For example, the American Precious Metals Exchange (APMEX) sells the Canadian Year of the Dragon half-ounce coin at a premium of just $1.35 over the spot silver price, depending on the quantity purchased.

APMEX (apmex.com) also operates its own mint, producing silver (and gold) coins in a variety of sizes.

The most basic AMPEX bullion "silver rounds" sell for premiums as low as $1.00 over spot, with prices adjusted regularly to reflect changing conditions in the global metals markets.

Other private mints that produce similar silver coins with competitive prices include Sunshine Minting Inc. (SMI), Englehard and Johnson Matthey. Many of these mints also produce silver "blanks" – coins with no design or engraving – in various sizes, which offer investors perhaps the closest coin in value to silver itself.

How to Buy "Junk" Silver

Join the conversation. Click here to jump to comments…

  1. Jon Hunt | February 27, 2012

    Great article Larry, but it does not mention buying Silver via electronic auctions.

    There is a large, thriving and vibrant market in precious metal bars and coins out there, with eBay alone reportedly transacting around half a billion dollars worth a year.

    I built a decent collection of Silver Bullion coins and bars largely through electronic auctions over the last decade, and even built a software tool to help me find the lowest priced silver. This tool eventually formed the basis of a our website which now helps users track and find the lowest premium Gold and Silver from a variety of sources including electronic auction.

    Discipline is key to buying Silver at auction, and while there are bargains to be had out there, it is easy to get carried away bidding and pay over the odds. That is another reason to use a premium tool like ours to help figure out how much you should be paying and stick to it.

    • Tabeth | April 10, 2012

      Hi John, can you share this software and website with us? My email is tabethagarus [at] gmail [dot] com. Much appreciated

    • Eli | September 11, 2012

      John Hunt/ Tbeth, Can you also share that same web info please? sunhills 8 (at) aol (dot) com. all one word no spaces THANKS!!!

  2. richard c perry | February 27, 2012

    send me everything you got about buying and selling silver.also is silver going up,and when.

  3. Jim | February 27, 2012

    I agree with prior post; the article was a very good summary. In addition to electronic auctions, there are also live auctions around the country. There is something to be said for seeing and touching what you buy, particularly where condition is important. In addition to ebay (where misrepresentation of condition of collector coins is frequent), proxibid is another popular electronic auction venue for coins and bullion, where bricks and mortar auction houses have an electronic presence.

    Jon, where can we find out more about your product?

  4. CoinManHerb | February 28, 2012

    Execellent aritcle!! I couldn't have said it better myself.

    Great explaination on the different investment options for silver and where to purchase. I agree that it also pays to look around and see where you can get the best price. The difference in mark up over spot can vary greatly between companies.

    I'm also going to share this article with all of my readers.

  5. Buy Silver | February 29, 2012

    Awesome article. Very informative.

    Today was a Cover-Up By the Fed and new buyers should not be afraid. what Bernanke attempted to tell the investment world today, that QE may not be necessary because of a modest improvement in the statistics of unemployment, if that was truly to be believed, then the stock market should have been off 800 points while gold was gold was down $100. Because the same thing moving the stock market is what’s moving the metals and that is pure liquidity.

  6. RAVI KUMAR,J | April 6, 2012

    Dear sir, I want to join one of the mlm companies which deals in silver, please do suggest me which company is worth in the long run and adds value to it.
    Please help me in this regard as i am very much interested in this business.

    with regards.
    RAVI KUMAR.J

  7. Silver Inversting | July 18, 2012

    This is a great article! Thanks for sharing.

    This reminds me of a book namely The Silver Bomb, basically same content, but more information on Silver.

    Anyway thanks again.

  8. Sophia | September 25, 2012

    I invest and making a tidy sum through ISN. MLM investment. ISN have just launched in the UK too now.

  9. Raymond | October 3, 2012

    Dear Sir,
    Thanks for the report about silver.
    Can I buy silver so that will give me more returns in later..
    Plz do advice me more regarding silver and it is better to buy silver and keep.
    Thanks & Regards,
    Raymond.

  10. Lucy Miller | June 14, 2013

    Thanks for sharing the brief information on investing on silver coins. It will help me to move to a safe investment.

  11. Chad | July 17, 2013

    Idk if its best to invest in silver bullion at this time, seeing as it really hasn't exploded like some experts said it would.

  12. Cesar Ramirez | November 2, 2014

    It's pretty cool to see this article just over 2 years ago Gold and Silver was much higher in value and the price has come down about $400 for Gold. They always say buy low and sell high right? What's your thoughts on the current prices Larry?

Leave a Reply

Your email address will not be published. Required fields are marked *


6 − one =

Some HTML is OK

© 2014 Money Map Press. All Rights Reserved. Protected by copyright of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including the world wide web), of content from this webpage, in whole or in part, is strictly prohibited without the express written permission of Money Morning. 16 W. Madison St. Baltimore, MD, 21201, Email: customerservice@MoneyMorning.com