Silver Investing 101: Bullion Basics via /r/Bullion — usmoneyreserveblog

February 15, 2019 by  
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via Silver Investing 101: Bullion Basics via /r/Bullion — usmoneyreserveblog


Silver As An Investment: Ways Of Investing In Silver

August 3, 2014 by  
Filed under Featured

Silver is like three other precious metals (gold, palladium, and platinum) in terms of being regarded as an investment commodity. In fact, this precious metal has been regarded as a form of currency and a store of value for over four centuries.

There are different ways by which one may invest in silver. Six are presented here:

Buying silver coins:

This is a popular way of taking hold of silver – physically. Perhaps the best example of a silver coin is the Canadian Silver Maple Leaf, which consists of 99.99{1f9e80e9a6a641a0aed0b1481432281f356f58d0fbd68df7416ed5f8f8be6947} pure silver. Silver coins may either be “fine silver” or “junk silver”. Junk silver coins are older coins with a lower percentage of silver. Examples of these are the dime, quarter, and fifty-cent U.S. coins minted in 1964 or earlier. These coins contain 90{1f9e80e9a6a641a0aed0b1481432281f356f58d0fbd68df7416ed5f8f8be6947} silver and are 8/10 troy ounce per 1 USD of face value.

Buying silver bullion bars:

This is the most traditional way of investing in silver. Silver bullion bars can be bought or sold over the counter in most banks in Switzerland. They may be stored in safe deposit boxes in banks or placed in non-fungible (allocated) or pooled (unallocated) storage with a silver dealer.

Opening a silver account:

An investor may open a silver account with one of the major banks in Switzerland. Here, silver can be bought or sold over the counter just like any foreign currency. However, the bank client does not own the actual silver metal. Instead, he/she has a claim against the bank for a specified quantity of the metal. A silver account is backed through either allocated or unallocated storage.

Owning a silver certificate:

In lieu of storing actual silver bullion, an investor may opt for ownership of a silver certificate. A silver certificate allows an investor to buy and sell the security sans the inconveniences associated with the physical silver’s transfer. The Perth Mint Certificate Programme, which is fully guaranteed by the Government of Western Australia, is the only silver certificate program in the world that is guaranteed by a national government.

Trading in Exchange-Traded Funds (ETFs):

An investor can have an easy way of gaining exposure to the price of silver through an ETF. Some of the well-known ETFs include iShares Silver Trust (with ticker symbol NYSE: SLV), Central Fund of Canada (with ticker symbols TSX: CEF.NV.A, NYSE: CEF), and ETFS Silver Trust (with ticker symbol NYSE: SIVR). Trading in ETFs means doing away with the inconveniences associated with the handling of physical silver bars.

Entering in a Contract For Difference (CFD):

Some of the noted financial services firms, especially those in the United Kingdom, provide Contract for Difference (CFD). In this silver investment vehicle, two parties (a “buyer” and a “seller”) enter into a contract, in which the seller agrees to pay the buyer the difference between the current value of silver and its value at contract time. In case the difference is negative, the seller receives payment instead from the buyer. A CFD, therefore, allows an investor to take advantage of long or short positions, enabling him/her to speculate on these markets.

It must be mentioned here though that silver has lost its forced tender status in the United States since the abandonment of the silver standard, when, on August 15, 1967, then U.S. President Lyndon B. Johnson announced that the U.S. would discontinue redeeming currency for silver (or any other precious metal).

Gold: Most Sought-After Precious Metal

August 3, 2014 by  
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Of all the different precious metals we can think of, gold is certainly the one most greatly desired. Since the beginning of recorded history, gold has been in use in many different works of art, coinage, and, of course, jewelry. Occurring as grains in rocks and in alluvial deposits, gold is shiny, soft, and dense. It is known to be the most ductile and malleable pure metal.

What makes pure gold especially attractive is its bright yellow color and luster. These characteristics are maintained as gold is chemically unaffected by air or moisture. Here are some of the properties of gold:


• Chemical Symbol: Au

• Atomic Number: 79

• Category (as an element): Transition Metal

• Group/ Period/ Block (in the Periodic Table): 11/ 6/ d

• Atomic Weight: 196.966569(4) g.mol-1

• Electron Configuration: [Xe] 4f14 5d10 6s1


• Density (near room temperature): 19.30 g.cm-3

• Liquid Density (at melting point): 17.31 g.cm-3

• Melting Point: 1064.18°C, 1947.52°F, 1337.33°K

• Boiling Point: 2856°C, 5173°F, 3129°K

• Heat of Fusion: 12.55 kJ.mol-1

• Heat of Vaporization: 324 kJ.mol-1


• Oxidation States: -1, 1, 2, 3, 4, 5

• Electronegativity: 2.54 (Pauling scale)

• Atomic Radius: 144 picometre

• Covalent Radius: 136±6 picometre

• Van der Waals Radius: 166 picometre

• Ionization Energies: 890.1 kJ.mol-1 (first), 1980 kJ.mol-1 (second)

The term “gold” was derived from “geolu”, an Old English Anglo-Saxon word which means “yellow”. Its symbol “Au”, on the other hand, originated from “aurum”, the Latin word for “gold”. The exact period when gold was first discovered could be a subject of dispute. While some accounts point to the year 1848 when gold was discovered in California, history tells us that this precious metal was already being used extensively by the ancient Egyptians, Romans, Greeks, Chinese, and South Americans.

Throughout history, gold has served as a measure of value and a symbol of wealth. It is one of the coinage metals (along with silver and copper). It is used, customarily and legally, as a means of payment or a medium of exchange. Gram and troy weight are the units of measurement used for gold. To indicate the amount of gold present in, say, a piece of jewelry, the term “carat” is used. A necklace, for instance, that is 24 carats means that it is made of pure gold.

While gold’s price is determined through trading in the derivatives and gold markets, its daily benchmark price is provided in a procedure called the London Gold Fix. In this procedure, the price of the precious metal is determined each business day on the London market. The fixing is done twice – once in the morning and another in the afternoon. The latter actually was introduced about 49 years after the procedure itself was introduced, as a means of providing a price when US markets are open.

This gold-price fixing procedure is done by the five members of the London Gold Market Fixing Ltd., namely The Bank of Nova Scotia, Barclays Capital, Deutsche Bank AG London, HSBC, and Societe Generale Corporate & Investment Banking.

Bullion: Mass Of Precious Metals

August 3, 2014 by  
Filed under Featured, Mass

Bullion is a mass of any one of the known precious metals. By strict definition, precious metals are those metallic elements that are rare. Bullion is commonly made of either gold or silver. Its value is determined by the worth of the metal rather than by its face value as money. To put it another way, bullion is valued based on the mass and purity of the metal used, instead of its artificial currency value.

New sources of ore have been discovered and there also have been improvements in the mining and refining processes. These two factors may cause the values of gold, silver, and the other precious metals to diminish. Also, the “precious” qualification of a metal is determined by the market value or high demand.

Bullion is traded on commodity markets in two forms: bulk ingots or coins, the latter minted by the government of a country. At least ten countries are known to mint gold and silver bullion coins. These are Australia, Austria, Canada, China, Mexico, Poland, South Africa, Switzerland, the United Kingdom, and the United States.

While bullion coins are issued as legal tender, with nominal values assigned to them on minting, such face values are far below the commodity value of the metals themselves. Here’s an example: Most of the gold coins issued by national governments, particularly those with currency values of between 10 and 100 U.S. dollars, usually contain no less than 31 grams of gold. On the average (considering the consistent rise in the exchange rate of gold), the value of gold is around USD12 per gram. Here, it is clear that the currency value assigned by the government to a gold bullion coin has no meaning.

Below is a list of some of the government-issued gold and silver bullion coins:

  1. Australian Gold Nugget, Lunar Series I, and Lunar Series II

  2. Austrian Philharmoniker

  3. Canadian Maple Leaf

  4. Chinese Gold Panda

  5. Mexican Centenario, Libertad, and Onza

  6. Polish Orzel bielik

  7. South African Krugerrand

  8. Swiss Vreneli

  9. British Britannia and Sovereign

  10. American Buffalo, American Eagle, and Double Eagle

The 10,000-dollar Australian Gold Nugget is one of the world’s largest bullion coins. Minted by the Australian government, this bullion coin is made of 1 kilogram of 99.9{1f9e80e9a6a641a0aed0b1481432281f356f58d0fbd68df7416ed5f8f8be6947} pure gold. Some other bullion coins larger than the Australian Gold Nugget have come out. However, these are not produced in mass quantities and are not practical to handle. Two examples are given here: One is the 100,000-euro Vienna Philharmonic, minted in 2004, which contains 31 kilograms of gold; the other is the 1 million-dollar Canadian Maple Leaf, minted in 2007, which contains 100 kilograms of gold.

Three factors – metal, purity, and weight – affect the value of bullion. The overall value of bullion is determined by the metal used. We know, of course, that platinum is worth more than gold, which, in turn, is worth more than silver. It is easy to understand, therefore, that silver bullion coins have become popular with collectors because of their relative affordability.