For precious metal investors, the whole idea of buying silver bullion often gets lost in the shuffle and excitement of buying gold and other high-dollar precious metals. And that’s sad, because silver bullion has charms of its own that shouldn’t be ignored — especially if you’re looking to build a physical stash.
Ease of Purchase
As precious metals go, it’s a lot easier to acquire silver bullion than the gold variety. It’s available in a variety of forms, through many venues: coin dealers, the U.S. Mint, and even at flea markets. You can get it fairly easily via EBay, too, without having to worry as much about getting stung by unscrupulous sellers.
I recommend that you stick with American Silver Eagles, Silver Buffaloes, and similar bullion coins, where the content and purity are guaranteed. While old circulated legal tender coins can also be considered bullion, I would avoid them for now, simply because it’s no longer legal to melt down American coins.
That said, the above law was passed in 2009 in reference to cent coins, because so many were being melted for their copper. The law may change, whereupon old silver coins will become useful as bullion once again.
Not everyone has enough cash on hand to purchase gold regularly, whereas it takes less than $30 (as of mid-November 2010) to buy an ounce of silver for your stash. You can buy 50 silver rounds, in fact, for the price of an ounce of gold… assuming you have the space to keep them in.
It can be argued that it would be best to just keep saving up for a nice chunk of gold, and that argument has merit… but meanwhile, the price of gold is advancing steadily, which may make trying to save up for that bullion something like Zeno’s paradox… you never quite get there.
Meanwhile silver is sitting right there at a decent price – and that price, too, is advancing.
The Value is Going Up
While silver tends to be more volatile than gold (what precious metal isn’t?), silver’s value has risen astonishingly over past months, climbing as high as $27.76 at close on November 8, from a price of about $19 at the beginning of September. That’s an increase of about 40%.
If gold had done the same, it would be worth about $1,900 per ounce right now.
Not that gold has done shabbily; the spot price is about $1,400 as I write, and it’s spiked as high as $1425.50. But that’s a rise of “only” about 20%. Percentage-wise, silver is beating gold two-to-one at the moment.
The Bottom Line
If you’ve been paying any attention to this site at all, you’ll realize that I’m unlikely to exchange my gold bullion for silver anytime soon. Historically, gold has performed better and more consistently than silver, with less volatility.
However, silver simply can’t be ignored. It’s easy to find, it’s cheap to buy, and the value is just skyrocketing. There’s no way to tell when it’s going to peak or if it’s going to crash, but you have to keep in mind that, like gold, it’s a uniquely useful metal, if somewhat less rare.
That being the case, some people are predicting that silver will rise as high as $50 an ounce before long. If that’s not a good reason to start buying silver bullion for your stash, I can’t think of a better one.
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Tell me what you think… are you ready to start buying silver bullion now? Leave me your thoughts below.