In the world of investing, you have probably heard the term bullion, and likely understand its relationship with gold. But did you know that there is also silver bullion?
This is an often overlooked precious metal that is well worth the research as a viable option for investing, and today we will take a look at everything you need to know about silver bullion.
As one of the most valuable elements discovered by man, plays many roles in day-to-day life and has all the pure metals, it has the best thermal and electrical conductivity. Let’s take a deep dive and explore this awesome metal.
A Closer Look At Silver Bullion
A piece of highly concentrated silver can be considered silver bullion (see also ‘What Is Bullion?‘), and it’s defined as being 99.9% pure or more. It’s well utilized in the investment world and will be made into bars and coins.
It comes in a whole host of sizes and shapes which will be determined by the Investment markets and the buyer.
This means you can purchase silver in a number of weights ranging from 1 to 10 kg, with one troy ounce being the most popular size.
Its value comes from the metal in which it is housed. It’s not an aesthetic or artistic collectible per se that you would buy for jewelry or rare coins.
Since ancient times, it has been known to be used for making mirrors due to its ability to reflect visible light, but now we know that the Greeks and Persians used silver coins as a means of currency.
Its ease at being distributed to two civilians became one of the most efficient ways of spreading wealth and storing it across the Empires.
During the 20th century, the notion of storing silver coins became popular, which forced governments to reduce the amount of silver circulating or remove it entirely.
When inflation spiked in the 1970s, the demand for silver increased which led to the introduction of bullion coins in the 1980s.
Silver Bullion Coins
Coins are made by the government mints for which they are for sale to investors. They contain a purity of 99.9% or more, and most silver bullion coins weigh around 1 troy ounce, which is 1.097 regular ounces.
The accuracy of these weights means that tracking the silver holdings is a lot simpler, and the number of coins that you have equals the total ounces of silver you own regardless of where they were minted.
The US has the most popular silver bullion coin, with its American Silver Eagle.
There have been more than half a billion of them sold since their inception in 1986, and many dealers will have the best prices on them and keep them in their inventory for Purchase.
You can find other popular coins such as the Austrian Silver Philharmonic, or the Canadian Silver Maple Leaf.
Silver coins will carry a denomination that is at face value to give them the status of legal tender.
The weight and purity of the coin will be backed by the issuing government which will also give advantages from a tax and import-export perspective in some areas.
Any coins that are fake will be prosecuted by the government under anti-counterfeiting laws, which are typically much tougher than normal laws.
In other words, avoid getting into the habit of seeking out fake legal tender otherwise you’ll have the Secret Service knocking.
Silver Bullion Bars
Silver bullion bars are similar to silver coins in that they are made to 99.9% or greater purity and also come in many shapes and sizes. You will find bars that range from as little as 1 gram to over 5 kilograms.
You will see nearly all of the produced silver bullion bars being made by private refineries, with two exceptions being the Perth Mint of Australia and the Royal Canadian Mint, which also offers silver bars beside their bullion coins.
Silver bars have a cheaper payment than bullion coins which are legal tender when they are compared at the same weight and purity.
You can find bullion bars in two basic forms, either poured or minted.
Poured means that they are individually made using molten silver and molds, where minted bars will be cut for my bar stock and then stamped with a design. Due to this, it is much easier to make pressed silver bars.
You also heard the term ingot, which is a rough form of silver that is intended to be worked on to a finishing product, where bars are the finished product ready to be sold.
What Is The Best Silver Bullion To Purchase?
Now for the million-dollar question: is it better to buy coins or bars? The short answer is that it will ultimately depend on your investing goals.
Silver bars are typically the cheaper way to get your foot into the silver market, buying silver coins tend to be more liquid and easier to sell down the road, as well as being a better collectible.
So there are pros and cons to each option.
If you are strictly in it for the prophets and what the most silver for your dollars, then silver bars are going to be your best option.
However, for those that are looking for a greater potential with their investments, then it might be worth considering numismatic or semi-numismatic silver coins which come with a collectible upside.
Regardless of which option you choose, it is still a good time to invest in silver which is a valuable commodity that comes with a number of uses. Its current price is also well below its all-time high price but it is likely going to pass down the road.
Silver is a viable investment option and would be one of the best ways to diversify your portfolio of investments without too much risk.
With an unprecedented number of choices when investing in pure silver, it is available In a number of forms and at a competitive price to meet a wide range of budgets.