Silver Bullion: The Best Way to Buy Physical Silver


Besides being a rare earth metal used in jewelry, industry and in making of tableware, another two important areas of usage for silver are monetary and investment uses.

For 5000 years, silver has been minted into coins and bullion and also had its time as money, much longer than gold. Although it has been demonetized, silver continues to preserve its “store of value” aspect as it is not prone to central bank created monetary inflation.

Silver has no counter-party risk: 100 grams of silver is 100 grams of silver independent of who says what. It is the same amount everywhere in the world and is recognized independent of the state it is subject to exchanges.

On the other hand, fiat currencies which are backed by confidence in government policies, are considered legal tender as long as the government does not declare otherwise and always carry the handicap of losing its purchasing value due to inflation.

Silver is immune to this type of central bank diseases and has retained its attraction and stood the test of time.

Every now and then we read in the news some lucky couple who found a hidden pot of silver coins from the civil war, now consider another couple who found a tin box full of old continental dollar of the federation days; which couple is to envied of? Of course, the couple who found silver, because silver is a physical asset which has intrinsic value unlike paper money which is dependent of its issuer, thus does carry any counterparty risk. Needless to say, as the issuing government does not exist anymore the continentals are worthless: a striking example showing the weakness of fiat paper money.


Silver Prices

The silver fix price is the first thing to look when deciding to buy and sell silver. It is sourced from LBMA(London Bullion Market Association) and is given in US dollars for a troy ounce which is roughly 31,1 grams.

Silver, unlike gold, enjoys being heavily demanded by industry. The foremost industrial demand for silver arises from electronics, energy, biomedical, optics, jewelry, dentistry, and photography, to name a few. This continuous demand creates a more volatile price action for silver. Thus the price of silver is not only determined by jewelry and tableware supply and demand dynamics, but also from by the state of the economy in general, world politics, and of course the demand for investment from OTC and future markets.

This continuous demand creates a more volatile price action for silver. Thus the price of silver is not only determined by jewelry and tableware supply and demand dynamics, but also from by the state of the economy in general, world politics, and of course the demand for investment from OTC and future markets.

What is silver bullion?

Silver bullion is the general term used for silver bars, coin, and rounds. These bullion products are minted to satisfy investment and gift demand for silver worldwide.


Silver Bars

Silver bars are produced in various weights, shapes, sizes and purities. Silver bars can easily be carried and stored. Most common weights are 1 oz, 2 oz, 5 oz, 10 oz, 100 oz, 300 oz and 1 kg silver bars.

These bars are mainly made from 99,9 pure or .9999 purity silver. Every silver bar carries its producer, weight and purity stamp. National and private mints may produce silver bars.

silver coins

Silver Coins

Just like silver bars, silver coins offer a viable investment option for investors. Coins of 1-ounce weight can easily be purchased due to affordability and stored thanks to their size.

Silver coins are the foremost choice for starter investments as they carry less premium in comparison to other alternatives. Dealers generally present lower prices for higher amounts of coins offering better deals. The savvy investor may pay less premium by considering a larger purchase, thus increasing his/her profit margins.

National mints produce their coins with beautiful designs such as the American Silver Eagle, the Canadian Maple Leaf or the Chinese Panda. This aesthetics aspect enhances the gift property of silver coins besides their “store of value” and investment characteristics.

As in silver bars, silver coins are minted from 99,9 percent pure silver and they may carry a face value as in the American silver eagle which has a face value of 1 US dollar.


Silver rounds

Silver rounds are just like silver coins but they do not carry a face value. Although national mints may also produce silver rounds, they are generally made by private mints.

Silver rounds do not carry face value thus cannot be used as legal tender.

Their most common weight is 1 ounce. Silver rounds carry a small premium over the ounce price making them a good choice for investment purchases.

As silver rounds are mainly produced by private mints, they come in a wide variety of designs. Silver buffalo, native American figures, Chinese lunar calendar animals or privateer collection featuring pirates, mermaids and alike are all good choices for gifting purposes. These are ideal silver gift ideas for christening ceremonies, birthdays and graduation days.

Where to buy silver bullion?

Silver bars, coins, and rounds may be bought from off-line and online dealers. While physical stores carry heavy fixed costs, online silver dealers are able to wipe out these expenses and offer better prices.

On the other hand, local stores operate over the counter and you may receive your silver bullion on the spot, in contrast to online dealers where you’ll have to wait for the arrival of your shipment which may experience delays.

Silver has a place in every portfolio because, not only it offers diversification from paper currencies, but also possesses the advantage of being “a store of value” which is not open to central bank manipulations, thus a protection from inflation.

Silver, like gold, is a “safe haven” option in crisis times where the credit flow gets weak and asset prices experience unforeseeable downside movements. As the speed of money slows and consumption dives down, individual investors, companies, and governments may choose to sell their assets at a discount they wouldn’t otherwise, to compensate their deficits and urgent expenses.

If this wave turns into a tsunami of sellers trying to liquidate their assets, silver and gold are likely to receive an excess of inflowing funds offering immense gains to their investors.

But one must never forget that the precious metals market is volatile and every investment may experience losses and may not return to its previous highs for a long time.

Thanks to beautiful designs, silver bullion is never wasted and always a gift option which has value enduring time.

Today, we have more choices than ever to choose from may it be bars, coins or rounds; may it be private or national mint products.

If we aim to buy silver bullion as an investment, dollar cost averaging of silver by buying every month 1 ounce or more of silver coins, is a practical and logical investment choice.

It is easily made and takes out the burden of perpetual decision making out of the investment process. By this way, we may make our investments in small amounts, easily store our bullion and enjoy the benefit of dollar cost averaging without worrying about buying and selling large amounts at the extreme highs and extreme lows, which is discouraging from investing and energy consuming.

Where should silver be stored?

Every silver investor must have a plan for storage.

While small pieces may be stored in homes in a safe place; for larger amounts you may opt for a more professional route like a private precious metal deposit company.

This option offers storage in secure vaults all around the world and is priced accordingly. These companies have many different plans including free shipment, storage in different states and different countries, allocated, unallocated and segregated storage.

In unallocated gold or silver storage plans, the deposited precious metal is a liability on the bullion vault company’s balance sheet where the “owner” is an unsecured creditor. Say, you deposited 1 kg bar of silver, the storage company owes back 1 kg of silver, but not the same bar you gave them or even a similar bar but a total of 1 kg silver.

In allocated plans, if you deposit 1 kg bar of silver, the company has the liability of returning 1 kg bar of silver back but that may not be the very same bar you stored with them.

In segregated plans, the vault is responsible for returning back the exact same 1 kg silver bar that you gave them. In this option, the deposits are separated from other clients’ properties.

One should get well informed to consider pros and cons of this option in order to make the right decision for their investment.

To end with, silver bullion products including silver bars, silver coins, and silver rounds, enjoy having the advantages of being a store of value and investment instrument free of fiat currency manipulations and are awesome gift options for everyone.