Despite the year's nearly 30% fall in silver prices, not everyone is sour on investing in silver. The U.S. Mint reported Tuesday that American Silver Eagle bullion coin sales have already set an annual record.
Authorized purchasers of the popular coins ordered their full weekly allocation of 500,000 coins, according to the Mint. That took total sales year-to-date to a record 40.175 million ounces, surpassing the previous annual record of 39,868,500 million ounces hit in 2011.
When the annual Silver Eagle record was reached in 2011, it took until Dec. 13 for sales to reach levels already touched year to date.
"There has been an extraordinary increase in the demand for physical silver this year," Jake W. Haugen, Chief Operating Officer of Texas-based Provident Metals, told Money Morning. "Investors are simply taking advantage of favorable pricing."
Silver prices have declined since 2011, after rising at a compounded annual rate of 23.2% between 2002 and 2011. Last year, prices fell 11.7%. Through September of this year, prices have averaged 20% less than the same period of 2012.
This price dip has delighted bargain hunters who invest in silver.
Investing in American Silver Eagle Coins
Minted yearly since its inception in 1986, the American Eagle Silver coin is undeniably one of the most popular silver bullion coins in the world.
The official silver bullion coin of the United States, Eagles are a convenient and cost-effective way to invest in precious metals.
The coins are revered for their high-quality finish, pure silver content, and historical design. The front design features Lady Liberty basking in the sun's rays, while the rear design features an iconic silver eagle behind a shield holding an olive branch in one talon and arrows in the other. Overhead are 13 stars, which represent the original 13 colonies.
Interest in the coins picked up during the 2008 financial crisis and ensuing Great Recession. Sales of the Silver Eagles peaked in 2011 as threats of the U.S. government loomed and credit rating agency Standard & Poor's stripped the credit rating of the United States of its prized AAA status.
Key Silver Eagle characteristics include the following:
- Each coin weighs in at one troy ounce of 99.9% pure silver, making them easy to store, transport, and trade.
- Silver Eagles are widely held the world over. They are easy to value since its price roughly tracks global silver prices.
- The market for the American Eagle Silver coins is highly liquid. Since its start in 1986, the U.S. Mint has produced and sold some 335 million Silver Eagles.
- American Silver Eagles are an eligible investment for U.S. investors in U.S. Individual Retirement Accounts (IRAs), presenting an additional tax advantage.
The benefit of investing in physical silver over the next few years will likely offset near-term price skittishness.
For more info on how to invest in silver today, here's our everything-you-need-to-know report: Your Last Chance at the Greatest Silver Buying Opportunity in History
CPM Group: Silver to Consolidate Through 2016 But Eventually Hit Record High – Kitco News Interview
- Standard & Poor's:
United States of American Long-Term Rating Lowered to AA+ Due to Political Risks, Rising Debt Burden: Outlook Negative
- United States Mint:
Bullion Sales/Mintage Features