Most investors choose gold as their traditional hedge. However, at over $1600 per ounce gold can be pretty expensive for the small investor. There is still a way to receive the safe haven qualities of gold at a small fraction of gold’s price, silver. When most people talk about precious metals they are generally referring to either gold or silver, and both are worthwhile investments.
Currently the price of silver is $31 per ounce, and at that price it is a steal. Since we are only four years removed from the Great Recession a safe haven to protect assets against inflation and the down economy is needed. Silver fills this need, and if you invest in gold you should consider diversifying into silver, because silver tends to out-perform gold. Furthermore, silver is a great way for stock investors to cushion the blow when stocks tumble.
Capitalism goes through boom to bust cycles. It always has, and likely always will to some degree. While the move to flat currencies allows government’s greater latitude in manipulating their economies, it is also part of the problem. Flat currencies make it easy for governments to borrow money and to print too much money. Right now the EU Central Bank is filling the European Union with huge amounts of Euros to stimulate the economy. However, this has caused the Euro to devalue and allowed inflation to increase.
This has kept precious metals prices as a whole high and stable. Currently silver is devalued and investors are wise to buy at the discounted price, because silver will go up. It always does. Silver bullion bars are a good way for large investors to purchase silver. Make sure the bullion bars are hallmarked for authenticity.
On the other hand, American Silver Eagle bullion coins are an excellent way for all investors to buy silver. This coin is produced by the US Mint, and is the world’s most sought after silver bullion coin. Another worthwhile silver bullion coin is the Canadian Silver Maple Leaf. The Canadian Mint is well known for minting quality bullion coins.
On the whole, when most people discus precious metals they are usually referring to gold or silver. Gold is the traditional hedge sought out by investors when the stock market is shaky, but gold is very expensive. A good alternative is silver. This metal offers the same hedge properties as gold does, but a fraction of what gold costs.
A lot of people would be very interested in buying silver coins at a discounted price. The good news is that there are some silver coins that you can actually do this with. These are 90% silver coin bags, which are commonly referred to as “junk silver bags.”
What Junk Silver Bags Are
Junk silver bags really aren’t junk. The term “junk” simply means that these silver coins have been circulated and thus they’re only in average condition. Therefore, these coins are only valued for the amount of silver they contain (usually around 90%), not for their collectible value. Usually these coins were made in or before 1964 when the amount of silver in coins was reduced to 40%. Some examples of these coins include Kennedy half-dollars, Roosevelt dimes and Washington quarters. Most dealers charge 1% under spot for these coins.
What To Expect From Junk Silver Coins
You should expect junk silver coins to look worn. They will usually have nicks and scratches on them too. However, you shouldn’t expect anything less from coins that are at least 40-years-old. This shouldn’t worry you though since it’s what’s inside of these coins that actually counts. Most of the time you will find that these coins are actually 99% silver, which is great news for any investor.
Where To Buy Junk Silver Coins
Junk silver coin bags can be easily purchased from a large, reputable online coin dealer. Of course, you should also be able to buy various sizes and denominations of these junk silver coin bags from your local coin shop too. As a final resort, you can try online auction web sites, which may save you even more money if you are careful.
Now that you know all about junk silver coins, the choice as to whether to purchase new coins (i.e. a newly minted, pristine condition American Silver Eagle coin) or to buy a bag of junk silver coins. Most of the time you’ll find that new coins actually cost 9% more than spot price while junk silver bags cost 1% under spot. Another consideration to make here is that whenever you do purchase junk silver bags you are actually getting 10% more silver than you’d get with the newly minted coins. This is great news for a lot of people who wish they had enough money to purchase and invest in silver coins.
If you are looking for the ultimate way to back up your assets with a secure and tangible precious metal silver investing might be for you. Certainly gold is the most sought after hedge when the stock market sinks or inflation rears its ugly and expensive head. Yet, gold trades for over $1700 per ounce and is likely to rise further. On the other hand, you can protect your paper heavy investments for a fraction of what gold sells for by simply buying silver coins. Silver is the ultimate bargain investment and currently trades for around $34 per ounce.
Not many people realize that silver gives you the same financial protection that gold does. Casual and small-time investors can still get into precious metal investing with silver. Unlike gold, silver is an industrial metal and is used in electronics, jewelry and is even used to fight infections in hospitals. However, the supply of silver is shrinking and lags behind industrial manufacturing requirements. This means the spot price of silver bullion will likely remain stable and increase.
Naturally we are all aware of the debt problems facing Europe. This has caused the Euro to sink and has affected the stock market in a very negative way. Stocks can swing up and then down on just a whim of bad economic news from the Euro Zone. This means stocks will remain unstable through 2012. On the other hand, silver is expected to rise up and may finally beat its $50 record. Silver is the ultimate bargain investment.
If your portfolio is paper heavy and gold is out of reach you need the cushion that silver investing can provide. The stock market will have its share of bad days as the EU debt saga continues to unfold. Furthermore, even gold investors can benefit from buying gold because silver often does better than gold. Moreover, silver offers the ability of significant speculative profits because silver is more prone to price swings than gold.
In the end, anybody looking to back up their paper heavy investment portfolio should seriously consider investing in silver. If the high cost of gold is holding you back from getting into the lucrative precious metal arena, silver has got you covered. Many simply cannot afford the high spot price of $1700 per once that gold offers. Yet, silver offers the same hedge protection that gold does, and at only $34 per ounce it is the ultimate bargain investment.
The last five years have been wreaking havoc on investors. The money that you thought was safe in stocks has dwindled, companies and banks are failing, and the value of the dollar is diminishing. It is a frightening time for all of those who put their hard earned money into stocks that are simply not performing. You might have noticed a bit of a dip in your retirement funds as well. What can an investor do to stop this financial hemorrhaging? One of the best things that you can do is to start investing in precious metals, and one of the best metals to choose is silver.
Over those same five years, the value of the metal has gone up even as the value of the dollar dropped. If investing in silver coins sounds like a good idea, you will want to find a silver coin dealer through which you can buy. How can you find a good dealer? You have several options. Continue reading