I am often asked the question by my non-stacker friends, "Why buy Silver coins?".
For me the reasons are clear and obvious, but to many people they are not. I consider several factors when I am buying silver coins:
Firstly I consider my budget and how much I am able to allocate to silver coins.
Then I look at my investment goals, to work out what sort of return I would like to achieve over a defined time period.
Finally I work through my own personal preferences of which coins I actually want to buy.
Once you get introduced to the world of silver coins, you will know what I mean by personal preferences. There are so many different types of silvers coins you can buy, below I will touch on a few options:
- Sovereign Government Coins: Many governments around the world have mints that produce silver coins that can be bought. These silver coins make up the vast majority of silver coins that are available on the market. They are generally trusted by the market and often have a highly level of purity and quality that other silver coin options. These coins are typically backed by their respective government and in most cases are recognised as legal tender in the specific country.
Examples include the American Silver Eagle (United States), Canadian Silver Maple Leaf (Canada), and Australian Silver Kangaroo (Australia).
- Historic Coins: There are a large number of collectors who prefer historic silver coins as they tend to hold both numismatic and intrinsic value. There is a real art and a skill when it comes to valuing these coins. It often comes down to how rare they are, what condition they are in and if there is some specific historical story that can be attributed to the silver coin. Hopefully in time I will develop the courage to venture into this community of silver collecting, but at this stage I find it too subjective when it comes to determining the numismatic value of the coin.
- Privately Minted Bullion Coins: I find this form of silver coin or more accurately silver round to be very interesting and intriguing. There are some very talented individuals out there that privately mint some very unique and special silver rounds. A lot of the private mints focus on low premium, high volume silver rounds that are good option if you investment goal is to buy silver as close to the spot price as possible. Other private mints get quite creative with the coins that they produce, creating theme-based silver rounds. Depending on the design and the theme, some of these coins develop a decent numismatic value over and above their intrinsic value.
- Limited Mintage Coins and Coin Sets: If you are more into collecting silver coins and are after a new hobby, then buying limited mintage coins and coin sets is a lot of fun. These coins are harder to find due to their rarity, but this also makes then very sort after and they often demand a higher premium. Coin sets often provide certain silver coin designs in different sizes, beautifully displayed in a case. I love coming across a rare coin set at trade shows or coin shops, if I can negotiate the right price, I will often buy these coin sets and limited mintage coins.
- Fractional Silver Coins: One of the great things about silver coins is that they do come in different sizes. So if you are on a limited budget then can still buy silver coins in smaller denominations. Any silver coin smaller than 1oz of silver is known as fractional silver coin. Some examples of these silver coins are 1/2oz, 1/4oz, and even 1/10oz.
Conclusion:
If you do decide to by some silver coins, please make sure you do your homework on the price of the coin and on the reputation of the individual or mint that you are planning to by from. Unfortunately there are a number of suspect individuals and mints out there. Some offer fake silver coins, while others heavily over price the silver coins they are selling. If it is an emotional buy, then paying a bit more for a coin you really love is absolutely fine, but if you are buying silver coins for an investment, then doing your research is essential.
Post authored by @strenue
