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Joe637

Investing in Silver

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Hi, 

So I joined this forum recently and been reading some of the topics here. I learned that there are a lot of different approaches to investing/buying/hoarding gold/silver. Some people buy old coins, some buy bars, some buy a mixture. A lot of people buy from a lot of different dealers and when they have promotions which make perfect sense.  I, on the other hand, have pretty much well-defined goals that I will outline below and would really appreciate experienced forum members advice.

My goal is to buy some Gold/Silver as a hedge against Fiat money given current politic tensions. I value my privacy and I am not interested in collectibles but in most content/kg per $ spent. I also think that being able to liquidate holdings fast is a very important feature of a commodity so shapes/sizes matter. I will buy gold physically in a dealer shop which makes it less likely that I will get any discounts but that's ok. I'm willing to pay just a little bit extra for privacy. With silver, however, I cannot do that because of ~20% wat in EU country I live/plan to store it. In this case, I will give up my privacy and I am willing to order online from Estonia (if this is still a possibility). So here are my thoughts:

 

Gold:

1. I will buy 1oz Canadian Maple Leaf or Australian Kangaroo coins as they are most suited for my purposes and apparently are of good quality and don't have premiums on them. They both are 999.9 which is great and are of highest quality (are they?). I know they aren't best gold/$ value as bars would be better but I don't have enough money to buy quantities in which this would make enough of a difference.

 

Silver:

2. I'm thinking of buying a couple of 5kg and maybe one 1kg bar. Also, I think it would be nice to buy a couple of coins in case I need to liquidate some of my holdings suddenly and keep it private.

 

Here are my questions regarding silver:

- Does anyone have experience buying from Estonian dealers and then having silver shipped to you to avoid VAT. If so could recommend those dealers and tell me how the process looks like.

I found this website:  https://www.libertysilver.ee/en/ and some positive reviews on google but I'm kinda turned off by the fact that they have headquarters in Sweden and some law problems apparently (info on their main page)

They only have coins which I think and is the only product I can buy without paying VAT. That would make the desired quantity of silver very hard logistically for me. (how you guys cope with buying silver in Europe?  I envy fellow Americans tbh..)

- which producers are known for high quality and content. I understand that spotting on the surface of a coin/bar is pretty common so that's why I decided that I want to invest in quality. Any other features that I need to be aware of when buying physical silver?

 

Again, I will appreciate any thoughts and advice from more experienced forum members. If you can link any good topics that I might have missed or any site with good investment info (all I read was so generic and basic, not going deep in properties of metals, what to look for etc.).

I will continue to read this forum and will update this topic with my findings and maybe with links so other newbies like myself can have the most important info in one place. Would love to see the ultimate guide to investing in silver breaking everything down from what to buy depending on goals and what to look out for etc. If it exists somewhere feel free to link it to me. For now, I will continue my education and I am very happy that I found this forum.

Regards,

Pawel

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20 minutes ago, Joe637 said:

My goal is to buy some Gold/Silver as a hedge against Fiat money given current politic tensions.

 

imo holding gold is better for this. maybe add some junk silver

just in case. usually the spread on silver is bigger compared

to gold. silver might provide a better return for those wanting

to pick the tops over many decades. imo silver is more

speculation than investing.

 

HH

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30 minutes ago, HawkHybrid said:

imo silver is more speculation than investing.

 

1

I agree that's why I want to put the majority of funds in Gold. And since I feel confident with knowing what I want to buy as for gold Im not so when it comes to silver. Will dig deeper but meanwhile, I found this:

Which means that I found a nice way of buying silver from Estonia, Vat free. Just need to read up on it and decide what to take.

(How come I didn't find this earlier... 🤦‍♂️ )

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I think we need to apologize, I thought you already knew about the group order 😉 The group order seems to be a nice thing for you in the UK to get silver without extra expense.

On your plans - I second the idea to buy gold anonymously, in fact I suggest to get all precious metals as anonymously as possible (within reason, as you stated).

On the products: You cannot go wrong with Maple Leafs, and while I personally consider Kangaroos as ugly, you cannot go wrong with them as well. You want 24k gold, which is a way to go so maybe look into Wiener Philharmoniker which are a little less popular, but also tend to carry a lower premium. Basically you cannot go wrong with any of the traditional bullion coins.

I am not so sure about the idea of getting silver in 5kg bars, as that is a very large quantity in one piece and awkwardly to handle. This depends on what your supposed buyer's circle would be one day. What is your supposed exit strategy? 1kg seems to be one of the most common sizes (appart from one ounce coins).

Could you elaborate on - why you would want your gold to be 24k? You are robbing yourself of a lot of excellent and possibly cheaper options with that idea.

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In regards to places to buy silver from, I ordered a couple of times from European Mint and gs.be without any issues. I'm also new to all of this and gs.be has some quite interesting and worrying threads on here (to me Eva seems kinda like a celebrity by how often she gets mentioned).

If you don't care too much about variety, I can recommend EU mint. Professional, fast delivery and solid support. They are my go-to, but gs.be has much more variety in their offering.

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16 hours ago, Joe637 said:

Silver:

2. I'm thinking of buying a couple of 5kg and maybe one 1kg bar. Also, I think it would be nice to buy a couple of coins in case I need to liquidate some of my holdings suddenly and keep it private.

Just bear mind never get any premium appreciation if you buy just generic silver/gold bars. The majority Silver/Gold I have in coin form and some of the collection (Queens Beasts 2oz coins) has appreciated in premium that worth double spot price.

Purchased majority of my stack via Silver Forum members/Group Orders/European Mint and Gold silver.be. Not purchased any graded PMs. Fortunate the vast majority PMs purchased was when spot prices were lower hence the majority of my entire stack is in profit. Accepted rule thumb dollar cost averaging but have a large amount to invest in PM timing and selection is crucial.

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16 hours ago, KevinFlynn said:

I think we need to apologize, I thought you already knew about the group order 😉 The group order seems to be a nice thing for you in the UK to get silver without extra expense.

On your plans - I second the idea to buy gold anonymously, in fact I suggest to get all precious metals as anonymously as possible (within reason, as you stated).

On the products: You cannot go wrong with Maple Leafs, and while I personally consider Kangaroos as ugly, you cannot go wrong with them as well. You want 24k gold, which is a way to go so maybe look into Wiener Philharmoniker which are a little less popular, but also tend to carry a lower premium. Basically you cannot go wrong with any of the traditional bullion coins.

I am not so sure about the idea of getting silver in 5kg bars, as that is a very large quantity in one piece and awkwardly to handle. This depends on what your supposed buyer's circle would be one day. What is your supposed exit strategy? 1kg seems to be one of the most common sizes (appart from one ounce coins).

Could you elaborate on - why you would want your gold to be 24k? You are robbing yourself of a lot of excellent and possibly cheaper options with that idea.

I also find Kangaroos ugly but they are the cheapest and gold content is the highest so good investment I guess. Although if all others sell for a premium today, that probably means that when it comes to selling, even if gold will be short on markets, those premium coins now will still sell at premium XD so hmm...

With a 5kg I just wanted to maximize $/kg but the more I read this forum the more I see people like to buy coins, even big ones (like 10oz). This means that a) liquidity of those will be higher and b) you cannot go wrong with them either. All that means I need to explore the sea of coins and learn more about them to get comfortable and to know which ones I want. And if I want them cause maybe I will still go with bars. As you said, 1kg bars are a way to go for the majority so maybe I'll buy more of those.

The exit strategy is a couple of years from now when fiat currencies will fail (I know it's sad but I don't believe they will last, mathematically impossible in my opinion) to a) use as currency, b) help fund a piece of land/flat. I guess in this scenario 5kg bars will be good enough but will do my research as coins may present a better risk/reward ratio.

 

With 24k gold, as far as what I read everywhere, the bigger is content the closer to spot price I will get since the dealer doesn't need to charge me for re-melting (?). Feel free to elaborate on why this is not the best option and what would you recommend :) And thanks for posting BTW. Really appreciate it 👍

 

4 hours ago, mezmer1411 said:

In regards to places to buy silver from, I ordered a couple of times from European Mint and gs.be without any issues. I'm also new to all of this and gs.be has some quite interesting and worrying threads on here (to me Eva seems kinda like a celebrity by how often she gets mentioned).

If you don't care too much about variety, I can recommend EU mint. Professional, fast delivery and solid support. They are my go-to, but gs.be has much more variety in their offering.

Thank you very much, I will check them out  :)
 

48 minutes ago, Abyss said:

Just bear mind never get any premium appreciation if you buy just generic silver/gold bars. The majority Silver/Gold I have in coin form and some of the collection (Queens Beasts 2oz coins) has appreciated in premium that worth double spot price.

Purchased majority of my stack via Silver Forum members/Group Orders/European Mint and Gold silver.be. Not purchased any graded PMs. Fortunate the vast majority PMs purchased was when spot prices were lower hence the majority of my entire stack is in profit. Accepted rule thumb dollar cost averaging but have a large amount to invest in PM timing and selection is crucial.

Thanks for the advice, I will definitely read more about it in here as well as whatever I can find in google. Any good reads you recommend for learning about investing in coins? I don't mind a book tbh. I just don't want to pay super premium over the spot just to learn that it wasn't worth it. With bars, I guess you can't go wrong in a way that they will never be below spot. thanks for the feedback 👍

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Let me see, if I can formulate some basics...

On coins and bars and value over melt

. the buy and sell value of any precious metal item will be influenced by recognition and trust (any value over melt, that is)

. to create that recognition value, precious metals are either put into specific form, like elaborate coins, whose design is in return guaranteed by the creator, or into bar form (basically just 'lumps of metal'), guaranteed by the brand of the producing company (can come certified, e.g. LBMA)

. governmental minted coins may carry a higher trust factor than those of private mints, highly recognizable private mints will in return carry a higher trust factor than lesser known mints

. recognition will also be influenced by your geographical region - some items will be easily recognized worldwide, while others may only be trusted regionally.

. a precious metal coin, if not of historical and/or numismatic value, is basically just a round elaborately designed 'bar' - however precious metal coins are usually carrying a higher cost over spot than straight up bars to take into account the minting effort - however again this premium will usually be also reflected in the sales price

. other than that in general the larger the amount of precious metal in a given item the smaller the premium over spot (not considering collector's items)

. then there are items that carry a certain collector's value on top of the intrinsic metal value or general recognition or trust value - these may be straight collector's series items, like Queen's Beasts, or (australian) Lunar coins - anything with changing design and low mintage

. or there may be historical pieces like former currency coins, going back to ancient greece (or even farther) - we're entering the field of numismatics here - or even specific bars (e.g. Rothschild bars)

On coins specifically

Bullion investor coins are basically not collector items per se, though they can turn out to be. And there are coins specifically targeting the collector's market.

On selling precious metals

The worst case scenario is always melt price, which may be down to 80% of spot. You will however always be able to realize that value at least. To realize a higher value you need to fulfill the criteria your potential buyers would set in regards to recognition and trust and collector's value. This is where your exit strategy comes in. If you are willing to settle for melt from the start (can be a plan), you just have to buy for weight, i.e. the most precious metal content for your money, which may include any non-seller at discount, silverware or just mishappen blobs of metal. You can however nearly guarantee more value by selecting and handling your precious metal items carefully. For example it is very unlikely that you will have to sell an unblemished government minted coin for melt. Likewise is is very unlikely that you will have to sell a Queen's Beasts Lion for spot (more likely a multiple of spot).

The rest is down to your imagination of what could happen. Exchanging your fiat money for wealth preserving precious metals now to exchange back to a new currency after a crash is a good intent. If you think that society will turn out to be somewhat the same after a crash, you can also heavily go into collector's or numismatic items. If you are imagining a 'Mad Max' style apocalyptic world after a crash, you should better avoid anything that would draw additional value from being a luxury item (like collectibles).


Please keep in mind that this is a very broad overview and there will be exceptions to the rule in any case.

 

 

Edited by KevinFlynn
corrections

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5 hours ago, Joe637 said:

Thanks for the advice, I will definitely read more about it in here as well as whatever I can find in google. Any good reads you recommend for learning about investing in coins? I don't mind a book tbh. I just don't want to pay super premium over the spot just to learn that it wasn't worth it. With bars, I guess you can't go wrong in a way that they will never be below spot. thanks for the feedback 👍

To be honest I have only read one book when it comes to PMs (free available online)

https://fake.richdad.com

image.thumb.png.0d2370858ba2fd9f4c391af08185553f.png

Most research I have done via YouTube subscribed to the following channels (blanked out all the none PM related channels). Word of caution be very careful who listen to on YouTube as it can and will influence you.

image.thumb.png.30a009e2f8ef5c4b83d5364a7875cf23.png

Edited by Abyss

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@KevinFlynn Great explanation! Really appreciate it 👍 Thank you.

@Abyss Thanks, I will look into that :)

I think the world after the collapse will be pretty much the same (with the exception of some people becoming poorer and some richer due to their investment choices) but just using sound money as a monetary medium. Gold and Silver will again become full-fledged money together with Bitcoin maybe for those that are tech savvy but who knows...


Basically, I was thinking about my strategy a lot and here are some things I came up with:

Gold: I will buy bullion coins - Canadians and Australians and treat them like a hedge against national currencies in which I don't want to store money.

Silver: Since I have to buy it in the UK, as it is logistically too much of a headache to do it in my home country (geting it in there from Estonia while being here...), I will just order some bullion and collectible coins in a group order (maybe march one as I am going on holiday now and still don't feel confident enough to buy in Feb). And I will treat it as a speculative investment and allocate fewer funds there.

Obviously, I will still continue to read this forum as I find it very interesting and helpful. 

 

Also if anyone has any insights or things I should know about bullion coins, feel free to post it here. Anything that isn't obvious to a novice.  

Again, thanks for all the info already provided 👍

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It would be easier to answer more specific questions on bullion coins than doing write ups, as there are many to choose from.

If you do a youtube search for top silver bullion coins, you will get some good videos with short and to the point information.

We could then fill in the blanks here...

 

Edited by KevinFlynn
corrections

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37 minutes ago, KevinFlynn said:

If you do a youtube search for top silver bullion coins, you will get some good videos with short and to the point information.

We could then fill in the blanks here...

 

 

I'm on it 😉

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If you not getting ready for end of the world but just looking for fiat hedge then keep in mind CGT (capital gain tax). If you think in small terms it doesnt matter but if you plan to live from your savings in future  it is worth to consider this matter. Remember if you are going to back to Poland they have different CGT rules and you ll have to think about transferring your wealth abroad in the future.

Edited by Michal
spelling :D

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Thanks for the advice. This is the reason why I want to buy gold anonymously - I will sell it anonymously as well if I need to. With silver, quantities are not going to be huge and getting rid of some will be relatively easy. But an important thing to keep in mind. 👍

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If your wondering about what type of silver to buy, bars or rounds, I would say that rounds generally win in the UK and EU on price. Some of those kilo coins work out a lot cheaper than a comparative bar.

Also if your crossing borders and customs ask you to declare the value of your stash you can always give them the nominal value stamped on government issue coins. Eg 1 dollar on a canadian maple.

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On 26/01/2019 at 06:19, Joe637 said:

They both are 999.9 which is great and are of highest quality (are they?)

Yes, 9999 is the common standard for gold bullion, except where Crown Gold is used for durability, as in the American Eagle, South African Krugerrand, and British Sovereigns. All small gold bars are 9999. (The big LBMA Good Delivery bars – approx. 400 oz – are only required to be 995, but are usually at least 999. Since they cost half a million dollars, I assume they're out of the picture for you.)

Occasionally the Royal Canadian Mint has produced limited edition 99999 pure gold coins, but those are more numismatic and will have higher premiums.

On 27/01/2019 at 00:23, Joe637 said:

With 24k gold, as far as what I read everywhere, the bigger is content the closer to spot price I will get since the dealer doesn't need to charge me for re-melting (?).

Dealers generally don't melt bullion. By closer to spot, I take it you mean the highest price, since in this scenario you're selling to a dealer and expecting to get below spot? In America, American Gold Eagles carry the highest premiums of any gold bullion coin even though they're not 24k – you could get spot for them, or a bit more, when selling to a dealer. Can someone comment on whether this is true in Britain?

I don't think melting or remelting costs are any different based on 24k bullion vs. 22k/Crown Gold, in the extreme case where a dealer wanted to melt bullion. 22k is much more useful in any melting scenario since the only thing that carries higher premiums than bullion is jewelry, and 24k is too soft for jewelry whereas 22k is primo.

On 26/01/2019 at 06:19, Joe637 said:

I'm thinking of buying a couple of 5kg and maybe one 1kg bar. Also, I think it would be nice to buy a couple of coins in case I need to liquidate some of my holdings suddenly and keep it private.

You might as well make your whole stack liquid. I'd definitely avoid the 5 kg bars, and a bit contrary to what others have said, I'd avoid the kilo bars as well. They're a bit less liquid than 10 oz bars, which in my opinion are the ideal size (one kg is about three times this size at 32.15 troy ounces). I learned this when I researched my price comparison article, and saw that many dealers didn't even have kilo bars in stock (this compared all major North American online dealers).

On 26/01/2019 at 06:19, Joe637 said:

which producers are known for high quality and content. I understand that spotting on the surface of a coin/bar is pretty common so that's why I decided that I want to invest in quality.

Spotting is a bit of a scientific mystery and doesn't correlate with standards of quality or purity. Maples before 2018 were supposed to be vulnerable to spotting and they were among the purest silver bullion coins at 9999. The Royal Canadian Mint recently announced that they've figured out spotting to some extent and have a new technology in their process that prevents or reduces future spotting, starting with the 2018 Maples: https://mint.ca/store/campaign/Mintshield-7700022?lang=en_CA/

I don't think there's any known variance in quality between the major national mints – someone correct me if I'm wrong. We'd probably need to know what you mean by quality. The Britannia, American Silver Eagle, and Maple Leaf are all magnificent pieces in my view. There's also no variance in "content" – a troy ounce is a troy ounce, and the only variance is in purity. Newer Maples and Kangaroos are 9999, while Eagles and Britannias are 999. All mints slightly pad the weight of their products so that they're always slightly heavier than one troy ounce, so the difference in purity shouldn't matter for 1 oz pieces. (It might matter a little bit for kilo or 100 oz bars.)

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@Frost I'll have a look, thanks! 

@universalcurrency Thanks for the advice :)

@Bimetallic Very insightful - makes a lot of sense to make my whole stack liquid. I'll definitely do that. I guess it's time for me to stack a lot of bullion and maybe a couple collector coins when I learn more about them. Thank you very much for the information provided.👍

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I figured out that I will buy Gold Canadian Leaf and Krugerrand from gold (only ones available when I walk in the shop from the street - the one I go to buy anonymously). Silver, I will stack through the forum and some sites like goldsilver.be. I will buy a couple of smaller bars (10oz) and a lot of coins - mostly bullion. I will shop for deals and dollar cost average. I have one more question: 

Do you guys have any good site you can recommend to quickly check silver spot price in a couple of currencies? maybe an app? I'm interested in GBP/USD/EURO/PLN. By now, I'm pretty sure I will have to check the spot very often, and since I like efficiency, a good site/app would be great.

Also, I would like to thank all of you for the information provided. It greatly helped me at the beginning of my journey. Now, I''m better equipped to look for some answers myself and continue my education, so again: BIG THANKS TO ALL OF YOU! :)👍

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On 27/01/2019 at 12:26, KevinFlynn said:

Let me see, if I can formulate some basics...

On coins and bars and value over melt

 

. to create that recognition value, precious metals are either put into specific form, like elaborate coins, whose design is in return guaranteed by the creator, or into bar form (basically just 'lumps of metal'), guaranteed by the brand of the producing company (can come certified, e.g. LBMA)

. governmental minted coins may carry a higher trust factor than those of private mints, highly recognizable private mints will in return carry a higher trust factor than lesser

On selling precious metals

The worst case scenario is always melt price, which may be down to 80% of spot. You will however always be able to realize that value at least. To realize a higher value you need to fulfill the criteria your potential buyers would set in regards to recognition and trust and collector's value. This is where your exit strategy comes in. If you are willing to settle for melt from the start (can be a plan), you just have to buy for weight, i.e. the most precious metal content for your money, which may include any non-seller at discount, silverware or just mishappen blobs of metal. You can however nearly guarantee more value by selecting and handling your precious metal items carefully. For example it is very unlikely that you will have to sell an unblemished government minted coin for melt. Likewise is is very unlikely that you will have to sell a Queen's Beasts Lion for spot (more likely a multiple of spot).

The rest is down to your imagination of what could happen. Exchanging your fiat money for wealth preserving precious metals now to exchange back to a new currency after a crash is a good intent. If you think that society will turn out to be somewhat the same after a crash, you can also heavily go into collector's or numismatic items. If you are imagining a 'Mad Max' style apocalyptic world after a crash, you should better avoid anything that would draw additional value from being a luxury item (like collectibles).


Please keep in mind that this is a very broad overview and there will be exceptions to the rule in any case.

 

 

Thanks Kevin, that advice has answered alot of my questions also, cheers

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