Add Silver To Your Portfolio

There are a number of things an individual investor, unversed in bullion or commodities, needs to know before dropping a dime into physical bullion. The first major obstacle is the premium price charged to individuals for physical ownership. The second aspect is a general understanding of the silver market. Finally, an investor must have specific goals for investing in silver and other precious metals. It is not too late to buy silver, but you need to be armed with a little knowledge.

When an individual investor purchases a 1oz silver round or bar, the cost is far above spot metal price. Assume silver is at $17.50 per ounce. The cost to acquire one ounce, including premium and shipping or sales tax, may be as much as $23.00 per ounce. Small investments create huge spreads. Selling silver will net you slightly less than the spot metal price in most cases. Silver would need to rise considerably just to break even. A more sensible approach is to purchase 10oz or 100oz bars. A larger investment means a much lower price per ounce for the individual owner. Another cost to analyze is storage. Utilizing a bank safe deposit box eats at your investment via fees. Storing silver under the mattress is awfully uncomfortable. This leaves a safe as the best home storage option, and expensive investment. Know what you are really spending to acquire and store silver, then decide how to best approach meeting your goals.

The silver market has risen dramatically in the last year due to investment in silver based paper, and by direct physical bullion investments The silver market operates on a fractional system similar to banks. That means one ounce of vaulted silver might be covering many times that amount in paper investments. What is the eventual result of this system? Collapse will occur if silver consumption exceeds supply over the long term. This has already begun. Electronically traded silver is simply not matched by vault stores. The entire system is awash with price control attempts and manipulation, and possibly outright fraud. 2009 American Eagle silver rounds have been cancelled by the U.S. Mint. The main reason for this move is to limit silver prices. The U.S. Mint operates for-profit. Clearly, there is demand for U.S. Mint silver. The only reason for rationing and cancelling bullion issues is to avoid a run-up in price. There is no remaining cheap silver supply. The U.S. Government stores are effectively gone.

The goal in silver, as other precious metals, is as a hedge against inflation. An investment and physical delivery of silver is a bet against the U.S. dollar. Inflation caused by government spending will drive up prices over the long term. While the current jump in metal prices may ease considerably as the equities markets begin to recover, silver is an excellent investment for the long term. There is no longer a huge supply available to hold prices in check. Mining production is steady, but does not meet demand. Buy steady, take physical delivery, and hold on to your silver.

Guide To Buying and Selling Gold

You possibly are going through this material because you have the intention to buy or sell gold coins. If not, then you probably have at the very least, an interest in buying gold coins or selling gold coins. Interest is good. I too was and am curious in buying and selling gold coins.

Gold does not need to be bought only as gold bars or as jewelry. It is simpler and a far better option to buy gold coins as it costs as low as $40 and is easily kept; they can be kept in a bank or simply stashed in the house.

If you are planning to purchase or sell gold coins from an offline shop or through the internet, make sure that all needed information about the gold coin, like what its called, make, and type, is available. When planning on purchasing online, you have the right to demand a picture of the gold coin, too. The seller will be quoting the price of the gold coin, together with his margin including any applicable tax. There is no coin that can be considered to be the safest gold coin to buy. It is all a matter of personal taste; a number people may very well prefer the American Eagles while while some people on the other hand would prefer, Sovereigns.

There are many different types of gold coins that you can get a hold of throughout the world like the South African Krugerrands, American Eagles, Australian and UK sovereigns, Chinese Pandas and Canadian Maple Leafs. When you start collecting gold coins, the most readily available gold coins which makes them the best gold coins to get a gold of are the American Eagles or Gold Sovereigns.

Keep in mind though that there is no constant size or weight for a gold coin; their varying weight and value is the way they are appraised, which varies according to the size of the gold coin. Of course, the unit of measuring for gold coins is the gram, but before that it was quantified as part of an ounce or troy ounces. The purest form of gold is measured as 999 parts of 1,000. Most gold coins are normally only 917 parts per 1,000, as they have been combined with other metal to make them easier to mint.

One term that I have seen interest those who are out to buy gold coins, which i see most of the time associated with buying or selling gold coins is ‘portfolio’, i looked up what the word means and i found the word is applied in different circumstances. And in the buying and selling of gold coin context, portfolio would mean a set of pieces of work COLLECTED to be shown to likely customers or employers.

Diversification is should be the main concern of someone that is interested to buy gold coins or one who is out to sell gold coins or anyone who wish to go on building a gold coin collection. And there even are parties to help you do this.

You portfolio’s structure, which just means, to my understanding, is the amount of gold coins you have in your possession and which types you have. Of course, the greater amount of gold coins you have in your hands the better but which types to have more and which ones to have less would depend on your own and financial demands. And there are companies that provides their services and share their experience to structure your portfolio to survive the uncertainties of the gold trade.

Things To Consider When Buying Gold And Silver

Investing in gold and silver is an effective way of safeguarding against inflation. You can make a long term profit, providing the metal continues its’ historical trend of increasing in value. Notwithstanding, due to the turbulent global economic conditions, many shrewd investors have turned to silver, which often bucks market trends over time.

Needless to say, as with all forms of investment, nothing is certain. Prior to risking any of your funds, you should make sure that you have a sensible game plan, and understand the intricacies of precious metal markets. By doing this, you will give yourself the best possible chance of profiting. Here is some advice about silver investment, which should help to swing the odds in your favor.

Familiarize yourself with the numerous different investment methods available. You could make investments in ETFs, mining companies, bullion, coins or futures. Generally speaking, coins or bullion are the most reliable and low risk items to invest in.

Indeed, opting for physical metal is a pretty safe bet. This way, you avoid committing to futures contracts, where you have to purchase thousands of ounces. Also, you avoid having to fund the energy expenses of mining companies. For novice investors, futures and mining companies are too risky a proposition.

Never invest in silver before carefully examining the market. Precious metal investments are considerably different to investments in bonds and stocks. Do some research. If you struggle to grasp the dynamics of market behavior, enlist the services of an expert, who will guide you through the process of buying and selling.

Make the most of the internet to educate yourself about investing. However, do not take everything you read as gospel. The World Wide Web is filled with information about investments in precious metals. Unfortunately, much of this information is wrong. It is far better to copy what experienced investors are doing, because they are at the coal face monitoring the markets, and investing their own money each day.

One proven technique, when investing in bars and coins, is to buy from people who are only charging a modest fee and selling near to the metal’s spot price. Typically, the amount of fees you pay should decrease, relative to the quantity of silver you buy. Normally, when purchasing coins, it is better to purchase silver rounds or bullion coins. This is a better choice than purchasing coins for numismatic reasons (i.e. for their value to rare coin collectors). If you collect rare coins yourself, this rule will not necessarily apply. Notwithstanding, most of the time, bullion coins are the recommended option for investors.

Keep regularly updated with market developments. Eventually, you will know the right time to buy and sell instinctively. Based on your personal investment ambitions (and the bull market), there might come a time when it is advisable to sell a large percentage (or even all) of your silver bullion for currency. However, you can only determine the correct time to sell or buy, if you have access to the latest market investment data. There are many websites online that provide this data, so that you can make the best possible investment decisions. Some websites specialize in providing data about particular precious metals.

Prior to making any silver investments, always determine the amount that you can afford to risk. To do this, you will have to take into account your readily available funds, your IRA rollover cash, and any other valuable assets that you want to invest. Make sure that you have a cash contingency fund in place, for any unpredictable costs. This way, you will be spending within your means.

Of course, your portfolio should still include gold. However, if you are a novice investor, it is best to purchase small pieces of gold gradually, when your budget permits. If possible, try to consult an expert at a gold investment firm. They can assist you with managing your portfolio, if you are setting up a gold IRA or rolling over a 401k to a gold IRA. They can help if you are investing large sums of cash and having your bullion delivered as well.

Always try to think clearly and remain emotionally detached. It is important to be aware of the investments you are making. Each year, lots of Americans are tricked into purchasing bullion that is exactly the same as other stock, or unsuitable for investment. If you want to safeguard your investment funds and hedge inflation, tangible assets like bars and coins are the best way to do it.

Why Do Gold And Silver Prices Fluctuate?

Gold and silver are probably the most common precious metals on the market today. The former has particularly been used as a form of currency since time immemorial and it is still acceptable as medium of exchange in most parts of the globe. These metals can be owned in the form of jewelry, artifacts or simply coins.

For many people, owning any of these metals is not only considered as a symbol of wealth; it also means you have a financial cushion against economic uncertainties that could bring down the value of currencies. However, this does not mean that investing in precious metals is foolproof. Like in any other form of investment, there are some factors that influence the prices of these valuable metals. It is important to understand these factors especially if you are considering investing in one or both of them.

Industrial Demand

Because of its properties, silver is an important raw material in certain industrial processes. Some of these processes include manufacture of computer chips, cell phones, batteries, solar powered generators, refrigerators and many more. As the demand for products that use this metal rises, so does the demand, which drives up its price.

It is also used many other electronic products that rely on silver’s incredible ability to conduct electricity. Normally, it is used to join other metals through brazing and soldiering. Actually, it has so many uses that the demand for it is not likely to go down in the near future.

In fact, many countries are embracing green technology and may use silver in HTS transformers as they are much more environmental friendly than the standard copper wiring.

The US Dollar’s Performance

Financial experts and advisers will tell you that there is an inverse relationship between silver price, gold price and the US Dollar. When the dollar is doing well, people have no hesitations to invest in dollar-related stocks and bonds. In such a case, both these metals suffer because fewer people are willing to invest in them.

However, once the dollar starts showing signs of poor performance, investors are very quick to pull out their funds to invest in these metals. The fact that the US Dollar is accepted as a valid currency in many countries means that any decline in its value will drive the value in most parts of the world. The inverse relationship will manifest if the dollar regains its strength and value.

Oil prices

The price relationship between oil and these metals remains a contentious issue, but the fact is oil prices have the ability to dictate the prices of most commodities in the market. Oil is the essential form of energy that is used all over the world to not only transport goods, but to also power up machines through LPG.

Once the price of oil goes up, virtually no commodity is spared from the same fate, and since gold is an accepted form of currency, it therefore goes without saying that it will cost more to buy any metal. Another logical approach or argument is the fact that these prized metals seem to appreciate in value as inflation rates soar. Any increase in the price of oil almost always results in inflation, and an increase in price is inevitable.

Supply and Demand

Another relatively obvious determining factor for the prices is the supply and demand pattern. For instance, if miners decide to go on strike for some reason and no mining goes on for a specific period, the market is bound to see a rise in the price of metals that is circulating the market. Likewise, when investors are rushing to buy it due to an economic crisis that has devalued the dollar, the prices are likely to go up.

Federal Reserve Banks’ Policies

Most people opt to save their money in banks with hopes that they will get competitive rates, which will see their savings increase in time. However, if the central bank decides to lower its interest rates on savings and deposits, more people are likely to shy away from investing in the currency and opt invest in metals.

The Relationship between the Two Metals

Amazingly, silver relies heavily on gold to perform. It actually has more dominance in the industrial sector compared to the financial world and hence benefits from gold just from being in the same category of precious metals. Anytime gold prices rise, silver catches up soon after, but it tends to plummet much lower than gold when precious metals lose value.