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Pros and Cons of Various Forms of Investment Silver

This page is designed to help you determine what type of silver to invest in. Various forms (such as 'junk' silver coins and 100oz silver bars) each have their advantages and disadvantages.



FormProsCons
1oz Silver Bullion Bars
  • Small premium over spot
  • Serial numbers make them safe (if recorded)
  • Serial numbers make them harder to counterfeit
  • Small size makes them cumbersome in quantity
1oz Silver Art Bars
  • You can collect them
  • Although easily sold, it may be hard to get as much as you paid for them.
  • High premium over spot
  • Small size makes them cumbersome in quantity
1oz Silver Rounds
  • You can collect them
  • Modest premium over spot
  • Small size makes them cumbersome in quantity
1oz Silver U.S. Eagles
  • Guaranteed by the U.S. Government never to be worth less than $1
  • Very well recognized and liquid
  • It is one of the highest premiums over spot for silver bullion
  • They are a more cumbersome than higher weight bars
1oz Silver Canadian Maples
  • Guaranteed by Canada not to be worth less than CDN$5.
  • Well recognized and liquid
  • It is one of the highest premiums over spot for silver bullion
  • They are a more cumbersome than higher weight bars
1oz Silver Coins (pandas, philharmonics, Libertads, etc.)
  • Guaranteed by a government to be worth at least a certain amount
  • Many are well recognized and liquid
  • Most have high premiums over spot
  • They are a more cumbersome than higher weight bars
  • Pandas are commonly counterfeited (in China)
10oz Silver Bullion Bars
  • Small premium over spot
  • Serial numbers help make them safe (if recorded)
  • Cost can be out of reach for smaller investors
  • Can't be broken up into smaller units
1 Kilo Silver Bullion Bars
  • Reasonable premium over spot
  • Serial numbers help make them safe (if recorded)
  • Cost can be out of reach for smaller investors
  • Can't be broken up into smaller units
40% 'Junk' Silver coins
  • Guaranteed by the U.S. Government never to be worth less than face value
  • Well recognized and liquid
  • Often priced below spot
  • Small sizes could be useful for bartering (for those that believe such a day would come)
  • If you're bored, you can hunt to see if there are coins with numismatic value
  • Have a higher face-value-per-ounce than 90% silver
  • The $500 and $1000 face value bags are a bit cumbersome
  • Since they are not pure silver, if they needed to be melted, it would cost more than with .999 fine silver
  • It is time-consuming to count the larger bags, if you want to verify the count
90% 'Junk' Silver coins
  • Guaranteed by the U.S. Government never to be worth less than face value
  • Very well recognized and liquid
  • Often priced near or below spot
  • Can be bought in small amounts
  • Small sizes could be useful for bartering (for those that believe such a day would come)
  • If you're bored, you can hunt to see if there are coins with numismatic value
  • The $500 and $1000 face value bags are a bit cumbersome
  • Since they are not pure silver, if they needed to be melted, it would cost more than with .999 fine silver
100oz Silver Bullion Bars
  • Small premium over spot
  • Serial numbers make them safe (if recorded)
  • Cost can be out of reach for many investors
  • In the 1980s, there were isolated cases of genuine bars with holes drilled and filled with lead
    (you can use the 'ring test' to help ensure that it is real, solid silver)
1000oz Silver Bullion Bars
  • Lowest premium over spot
  • Takes the least amount of space (per ounce)
  • Serial numbers make them safe (if recorded)
  • Cost can be out of reach for many investors
  • The bars may need to be assayed when sold
  • It may be hard to find a buyer
  • The bars do not weigh exactly 1,000 ounces, making it harder to calculate how much you have
Silver ETF (Exchange Traded Fund)
  • Typically no premium over spot
  • Very easy to trade
  • You don't have physical possession of the silver
  • You need to be confident that the silver backing the ETF exists
  • You have to be confident that the ETF is not manipulated in any way (e.g. lots of shares sold short)
  • Some would say that it may be too easy to sell (and you might not profit as much when selling, but that could also prevent a loss)
Pooled Silver Account
  • Typically no premium over spot
  • Typically no storage or other annual fees
  • You don't have physical possession of the silver
  • The silver may not even exist; apparently it is standard practice at some banks not to have physical silver backing the pool
  • You have to trust the company holding it, that they don't go out of business
  • Any silver backing it isn't allocated to you, so in a bankruptcy, you might not get the silver owed you

Want some more ideas for what type of silver to buy (as well as how and where to buy? Check out the SilverCoins Buying Silver: The Definitive Guide.



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