for small amount of silver (anything below 50oz i would say is small), if want to liquidate easily, i can see so far the market is rather limited to SLS. unless you have a different offline network, then that might be a different story.

however i believe the day when all jeweler stores will buy silver from retail buyers would come, the question is when

This post has been edited by property101: Mar 10 2012, 10:55 PM

Hi everyone,

I have some questions and doubts about silver as investment...

The price of silver now is around 35USD/oz... So if I convert into RM, it shall be RM110 +/- per oz.

However, I take a look at the price of those silver rounds and bars, they seem "overpriced". I know there must be reasons but I don't know what's the reason.

It's like,
1 oz silver American Eagle Round cost around RM130...
2oz Perth Mint 2011 Lunar Rabbit Silver Coin cost around RM350
2oz Perth Mint 2012 Lunar Dragon Silver Coin cost around RM550

It seems that these silver rounds are not sold according to the price of silver per oz. Can anyone explain why? And which one is more worthwhile to invest? How will the value of those rounds become when the price of silver goes up? Eg: Will 2oz Perth Mint 2012 Lunar Dragon Silver Coin worth more than 2oz Perth Mint 2011 Lunar Rabbit Silver Coin when the silver price shoot up?

Can someone please explain? Thanks

Spot price is not an end product...same like gold spot price.it doesnt reflect any end product.It is just a reference to the world market price.

So does it means that, when the spot price is going up, the end products of silver will go up also? Does this matter in terms of investment?

jeenhao, silver spot price is merely a measurement for the value of the precious metal in terms of USD. it purely base on content value without concerning what form of silver is it in.

when a person buy an American Silver Eagle coin (commonly known as ASE in the market), it is fair that being sold at RM130. but why? since RM110 is the spot price?

the difference here of additional RM20 is being used for:
1. mintage of the coin into the particular design - no one is going to mint it for free. somebody has to pay for the mintage fee. this also closely related to premium. some legal tender coins carry higher premium compared to privately minted round and bar. some numismatic coin would carry very high premium as high as RM 500 / oz (example is older panda coin)
2. delivery from overseas to malaysia - somebody has to pay for the delivery charge
3. the distributor profit - the seller is obviously not ordering the product from overseas and distribute the coins to local market for fun. the seller is marking it up for a marginal profit for taking care of the product from overseas until to your hand.

hope these explain

This post has been edited by property101: Mar 10 2012, 11:50 PM

The price you see is COMEX price, which is price of FUTURES. It is the asking price for BULK, RAW and UNPROCESSED silver. It is used as a fundamental for silver price. Then, add in overheads such as mintage, tax, packaging, shipping, security, workforce, branding, food and the whole lot, you get your final end product price. Some coins are more expensive than the others due to the low mintage or in another word, collection value. The recent hype is on 1oz dragon which can go up to RM350-RM400 for 1 oz, a price which you could probably get 2 coins of other kind. Rabbit lunar is asking for high price because it is no longer in production - thus, a collection premium.

Also, some brands are noticable more expensive than the others, like the royce rolls of silver, PAMP.

All the best in your silver investment.

Thanks a lot for the explanation Now I understand better...

So I've another doubt...

I saw in the first post in this thread, it mentions that for small retail investors who aren't coins collector, 1 ounce silver round and 10 ounce silver bar are the suitable choice...

I see around, 10 oz silver bar is mostly around the same price... But as for 1oz silver coins/rounds, there are a lot of choices with different prices...

Which one shall I buy to invest as a beginner???

Let's say,
1oz of coin A now worth RM130, 1oz of coin B worth RM160 now.
SO let's say after a period of time, silver price has shoot up. Coin A now worth RM 200 for example, so will coin B worth more than that during that moment???

Coin has "2 parts of cost"
Part 1: Silver Value (Increase during crisis times)
Part 2: Art Value (Increase during good times)

my opinion:

During normal/good times: Silver Value neutral/increase, Art Value increase
During crisis: Silver Value increase, Art Value decrease

if you want to speculate in rising prices of silver during normal times
Get coins with higher art value (limited edition Panda/Dragon)

if you want to preserve your wealth, just get silver bar or government minted coins (America Silver Eagle)
silver bars have the least art value, which means for the same amount of $ you pay, you get more amount of silver.

This post has been edited by jayjay: Mar 11 2012, 12:13 PM

Thank you for your suggestion!

So can say that, for long term investment, it's better to get silver bar?

i wont call it investment, just insurance or wealth preservation
ya, I am using silver bars for that purpose.
Also get those 100g or 1oz ones.

Small quantity makes it easier to sell (either to dealer, or to end user)

vs

If you are holding only a 1kg bar, you won't know when to sell.
When the price is high, 1kg bar will be too expensive for 'normal people' to buy.
Less potential buyers= less demand = lower price


This post has been edited by jayjay: Mar 11 2012, 12:21 PM

Thank you for your suggestion

I was just wondering if there is anyone here invest in junk silver?

u mean those 90% silver coins?

Yes that is the one. Mostly the old US coins that I am talking about. Haven't started myself yet, just asking if there is anyone here did that.

very good explanation jayjay!
i myself made a bad decision in the beginning of silver investment by buying larger size bars.
now i only buy 1oz and never look back.

1oz rounds or bars?

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Added on March 11, 2012, 3:59 pmAnother thing... Does buying and selling of silver products taxable? Do we have to pay taxes?

This post has been edited by jeenhao: Mar 11 2012, 03:59 PM

just declare and pay if u want
else, nobody will question

precious metal investment is very private and out of normal financial rules

both bar and round. but i personally prefer round. seems easier to be liquidate.

Hi,

I suggest that you don't go into junk silver, not many people buy them now and there are advice from expert not to touch junk silver. Forgot where I read it, I think it's mike himself who mentioned it. 90% silver is like 925 sterling silver, whoever is investing or buying pure silver will most likely not venture into those anytime soon. Small silver beads which is 99.9% pure maybe...

chef

agreed. most people are no buying junk silver. even though i myself like it very2 much especially the 10 cent dime 90% silver.

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Added on March 11, 2012, 9:50 pmthere are kiasu investor out there who want
1. Low premium.
2. Must got brand + certificate.
so 1 kg PAMP fit their investment demand.

Let them figure out how to sell when the day comes, at the moment they will just buy 1 kg.

This post has been edited by GoldChan: Mar 11 2012, 09:50 PM