Silver is a precious metal that has long been used for circulation and a wide range of industrial uses. Like gold, it is bought in bulk by investors looking to trade or use it for collateral against an uncertain economy. If you want to get into the silver trading game and need where to start, here are the main things you should know.
Step
Method 1 of 5: Getting Started
Step 1. Consider what kind of silver you want to buy
You can also buy nuggets, including silver pieces and silver bars, silver certificates, which are a consideration for buying nuggets if you're not going to keep them for yourself, and future silver, which is a great way to invest if you think the silver will be valuable in the future.
If you want to get real, real silver, be careful with manipulation and exchange techniques where the seller offers a certificate that will guarantee ownership of the silver everywhere
Step 2. Find a trusted seller
To avoid fraudsters and unpleasant buying situations, look for trusted sellers. Perhaps the surest way to get in touch with a trusted seller is to find a list of trusted sellers from the US Mint website. Type “US Mint coin dealer database” into your favorite search engine and it should take you directly to the US Mint website page where you can search for Mint-registered national and local sellers.
Step 3. Estimate the market price per ounce
In financial markets, there is what is called the ounce measure which indicates the price of the precious metal per ounce. Look for market value to make sure the seller is not selling at a price well above the market price.
Step 4. Negotiate the terms of the silver bargain
In some silver sales, there are often special terms that must be negotiated between the seller and the buyer. Without considering this issue, you may be short on silver when buying silver from several sellers.
- If you agree to the silver certificate scenario, find out how the seller obtains the silver to fulfill your precious metal certificate. For example, buyers report that commercial banks provide certificates claiming to back silver only to face delays and obstacles when they demand to receive silver.
- Discuss the knowledge and value of silver. Some sellers offer silver coins as silver. In some forms of transactions, it is key for the buyer to understand how the knowledge or value of the coin can affect his purchase. Without knowing these details, you could end up paying a lot for your silver holdings.
- Ask about premium fees. Some sellers, such as banks, charge additional fees for the sale of silver. As a result, silver buyers will be immersed in their purchase from the moment they sign the agreement. The demand that your seller values is a fair transaction value for the silver so you can know extra if the price of silver soars.
- Ask the resale price. Some sellers will buy back the silver they sold to you and others. Keep in mind that without a repurchase agreement, you may suffer losses when you try to sell your silver if you cannot find a buyer who will value a fair market price based on the original selling price as the market reality.
Step 5. Get basic pricing information for filing fees
Another important step in purchasing silver or any other precious metal is obtaining documentation of your sale and the price of the silver. With this you can set your base price when you sell silver at a later date for profit. Without this information, an IRS Agent could dispute your gold sale when you sell your precious metal to another buyer.
Method 2 of 5: Buying Pieces of Silver
Step 1. Know how to identify real silver
Genuine silver jewelry or silverware will be stamped with a 800 or 925 number or a guarantee that the silver is pure (eg Sster, Sterling, Stg). If you can't find any identifying marks on your silver, here are three specific, but not guaranteed, tests you can do if you're trying to distinguish real silver from fake silver.
- Genuine Silver Ring. Either flick a coin in the air or tap with another coin to make a sound. The sound you hear should be a silver ringing, high-pitched and bell-like sound. If you flick 1932-1964 parts (90% Silver) and put 1965 parts (90% copper), you will hear the difference immediately.
- Real silver melts ice. Place the ice cubes onto a silver block or silver coin and observe the ice cubes melt faster than if they were placed at normal room temperature. Silver melts ice quickly because silver has a high thermal conductivity.
- Real silver is not magnetic. Get rare earth neodymium magnets. Adjust the angle of your silver bar to 45o and let the neodymium magnet slide down. In real silver, the magnetism will go down slowly. On non-silver materials, it will either stop above the rod or drop rapidly.
Step 2. Ask friends and family
Many people destroy or damage silver jewelry which they would then be happy to sell for a reasonable price. Some even give you free stuff.
Step 3. Place an ad
Use Craigslist, your local newspaper, or even your local radio station to let the audience know that you are interested in buying a piece of silver.
Step 4. Find a trusted dealer
Check with your community before jumping into the first transaction you come across. (online trials are not included.) If the deal seems too good to go by, then go for it. Then use the recommended dealer's US Mint list for a good start.
Step 5. Find your own source
Look for it at online auctions, laundry, flea markets, bargain shops, and safekeeping stores. Online auctions usually offer high prices, but for trustworthiness it will also have a way for you to ascertain whether what you are buying is genuine silver. As said, you can often find hidden treasures in wholesale and assortment baskets at thrift stores and for a fraction of what they consider worth it.
In particular, look for thin rings, broken jewelry, and silverware
Step 6. Get to know the local pawn shop owner
While a pawn shop isn't really necessary at first when you're looking for silverware, finding out the owner will provide you with lots of valuable insights and the possibility of you setting up relationships. If you're lucky, you'll find a pawn shop that doesn't have the resources or inclination to transact for pieces of silver and will attempt to get you in touch with a potential seller.
Step 7. Look for silver in unexpected places
In addition to jewelry, silver can be found on circuit boards, old electronic equipment, cell phones, camera plates, and old cameras. Look for dead electronics to take them to cheap stores and scrap yards or any equipment the school or office building is upgrading.
Step 8. Detail your silver
Take all the non-silver components and collect all the silver pieces in a closed container.
Note that some pieces of jewelery are worth more when they are in the form of a collection than the details of the pieces
Method 3 of 5: Buying silver coins, silver bars and pieces of silver
Step 1. Think about investing in silver coins
A silver coin derives its value from the silver it contains as well as the currency value for the coin. In most cases, the currency value of the coin is the primary value required. Which means that it's a coin's characteristics -- its origin, quality, and so on. -- meaning that it's more favorable to the true value of silver when it comes to price. For this reason, many investors warn against investing in silver coins if you are not interested in the value of the currency at all.
Due to the habit of collecting silver coins, their prices would change easily. In fact, their prices can change drastically depending on market demand, often for that reason nothing can be done about the price of silver. If you are going to invest in silver coins, be careful before this hinders your journey
Step 2. Try to invest in silver bullion
Silver bars are bars made of almost pure silver, almost like you see in the movies. Due to their unique nature, they are often traded at above market prices for silver. You can find silver bars at large banks or wholesalers.
- Silver in bulk is just as effective as silver bars. Coins in large quantities are made from precious metals, designed for resale value for commercial use. Like, you can buy silver coins in bulk if you don't mix the idea with owning silver bars.
- Silver bars come in different shapes and sizes. 30gram, 150gram, 300gram, 3kg, and 30kg. The rods are standard, although there are manufacturers who design lighter rods. What you need to know when thinking about weight is this: The smaller the rods, the higher the premium you will pay. If you want to save your money, buy bars in bulk!
Step 3. Consider investing in silver pieces
Silver pieces are a mix of ingots and coins. Like bars and wholesalers, they have no currency value. Like coins, they will have the same shape and usually contain an ounce of silver (1/12 of a pound). When buying from a private factory, they can print with various designs.
Method 4 of 5: Buying silver without owning silver
Step 1. Consider investing in an ETF
An exchange-traded fund, or ETF, is a security that tracks an index or commodity (such as silver) but is traded like a stock. While ETFs are similar to index financing, often no commission fees are shared with the ETF buyer or seller, unlike index financing.
- It's important to remember that when you choose to invest in an ETF, you're not actually buying the silver or even the ownership of the silver. Usually, you just make a bet on the price of silver which continues to increase.
- If you believe the silver price will continue to fall, or you want to easily guarantee the silver price will fall, you can also short sell with the ETF.
- ETFs also benefit from having a high degree of liquidation, meaning they can cash out quickly without affecting their true value.
Step 2. Also consider investing in mining companies for less risk issues
If you wish, you can also invest in mining work for additional silver hoards or trading in ETFs. If you are following a mining company or improving in the industry as a whole, this could be an option. Consider this protest letter when investing in a mining company:
- The price of the mining company's stock may fall even as commodity prices rise. Even if silver stagnates, you could lose your money on your investment if the mining company you invest in has poor management or bad parts. Investing in mining companies is risky.
- With greater risk generates greater potential for income. If you are willing to take the risk, or if you have the ability to do so, investing in mining work can be quite rewarding.
Method 5 of 5: Making the most of your silver
Step 1. Be aware that owning silver may be more useful than having an unreal silver security certificate
Silver, such as coins, bars, wholesale, or pieces, is often used in everyday and industrial manufacturing. This would make them more useful than the security traded in silver, although not very easy to liquidate. If you are planning on investing in silver, start with the precious metal before speculating on other, more complex forms of holdings.
Step 2. Use silver as a hedge against an uncertain economy
When the economy is volatile and slow to develop, silver is a good hedge. Fencing is a strategy that reduces the risk of losing when the market is up and down, usually by investing in a offset position. Silver is a good hedge against depreciation and even inflation. That's because if the value of the benchmark, precious metals such as silver and gold become relatively stable, if not increase in value.
Step 3. Don't buy on hope and sell with trepidation
Many silver and gold buyers get into investing in exactly the wrong way: They buy when they realize prices are going up, and they sell when they realize prices are going down. Don't be someone who breaks the first principle of investing -- Buy low and sell high.
- Try to think of other ways. Don't buy when other people are afraid and the price of silver is high, buy it when everyone is satisfied and the price of silver is down or the price is oscillating.
- Look at the historical chart of the silver price. Over 30 years, in normal economic times, the price of silver has remained unchanged between $5/ounce. If you can afford to wait until silver hits a low price, use this as a reference point and then invest. When the economy is volatile and the price of silver goes up, sell your silver for a big profit or keep it as a hedge against depreciation.
Step 4. Recognize that the silver market is “very” volatile
If you are not ready to ride the rollercoaster when you are investing in silver, it may not be a good investment for you. Of course, if you want to buy silver when it's cheap, then a change will be a good change. However, expect convoluted ups and downs in prices and dips and changes as consumer sentiment and monetary policy change.
