- Due to the low cost of entry, silver bullion can be a great entry point for new precious metals investors
- Due to silver’s high demand from industry, long-term value forecast should remain high
- Silver bullion is priced in bulk. Therefore, the more you buy at one time, the more you save
- Silver bullion is easy to buy, sell, transport and even store
- Silver has been used as currency for thousands of years and thus, tends to perform well during times of economic crisis
- Because silver is more volatile than gold, the percentage points of gains or losses can also be higher
Table of Contents
- Popular Ways to Invest in Silver
- Bars vs Coins vs Rounds
- How is the Silver Bullion Price Calculated
- Buying Physical Silver vs Silver Stocks
- Buying Silver vs Gold
- Silver vs Other Precious Metals
- Silver IRA
- Where to Buy Silver
- How to Sell Silver
Precious metals are considered one of the safest investments during economic downturns. They are also one of the most popular options to have on your portfolio as tangible assets.
Whether you choose to buy silver rounds, coins or bars, these types of assets are designed to protect against ambiguity of the markets, and due to its industrial demand, silver bullion is constantly seen as a great choice.
Commonly referred to as the “poor man’s gold,” silver has been used as a trading metal for millennia. In the contemporary world, its appeal has risen exponentially due to its various uses in growing markets, such as medicine, solar energy, water purification, batteries, electronics and jewelry.
The search for silver bullion is so high due to pandemic driven buyers, the U.S. Mint announced in early February 2021 they had a hard time keeping up with the surging demand over 2020 and January 2021.
This guide will take you, step-by-step, on how to start buying silver online in a safe, reliable way, for both newbies and experienced investors.
Popular Ways to Invest in Silver
If you are just starting out as a silver investor, you might be overwhelmed by the different methods you can choose to purchase. These include:
- buying silver from ETFs (exchange-traded funds);
- buying silver mining companies stocks;
- buying silver futures contracts;
- buying physical silver bullion (such as coins and bars).
When you buy silver from ETFs, your assets will be held by the funds manager or a custodian, while you only get a certificate.
Similarly, with mining companies stocks, your investments are in the hands of someone else’s management. If the company is poorly managed, their stocks could go down, no matter how high demand for silver is at that moment.
Futures contracts involve more speculation, and as such, higher risk. Silver prices might fluctuate during the period of a trade and an investor could end up losing part of their investment.
Our experience shows that buying physical silver bullion could be the best way to invest in silver for these reasons:
- Owning and storing the silver bullion yourself has virtually no counterparty risk;
- No default risk either;
- During economic downturns, it’s important to be liquid. Owning physical bullion yourself will make it quick and easy to liquidate your assets at close to spot price.
- Physical silver bullion cannot be depreciated like paper or digital forms;
- Owning physical silver is owning a real asset that has been used as money for literally thousands of years.
Now, there are a variety of ways to invest safely in physical silver. Let’s take a more in depth look at the options:
Silver coins have been minted for thousands of years, from the kingdom of Lydia in Asia Minor over 600 years B.C., to ancient Greeks and Persians, and they are still struck around the globe by a variety of mints, forming the backbone of silver investment and collection.
The United States Mint has arguably one of the most successful silver bullion coin programs in the world, which is the American Silver Eagle, easily recognizable by the walking liberty on the obverse and the heraldic eagle on the reverse.
The Royal Mint of the United Kingdom has been in operation for over a thousand years. One of their best selling silver bullion coins is the Silver Britannia coin.
Coins are struck in a variety of forms. One troy ounce 99.9% pure silver coins are the most common, but there are also 10 ounce and even 1 kilo coins available on the market.
Although coins are considered legal tender and carry a face value, their true value comes from their precious metal content (intrinsic value).
That being said, because silver is almost a hundred times cheaper than gold, the modest price of the silver coins enables new investors into the market, especially considering they are easy to liquidate, making them a safe choice.
It’s also important to point out that numismatic coins draw appeal to collectors all over the globe. The rarer the silver coin (or the mint year), the more expensive it may be, in spite of being the same 1 troy ounce of 99.9% pure silver.
Coins are usually available for sale in singles, in tubes or in monster boxes. Single coins are good purchases for those just starting out, or those just adding a little more diversity to their portfolio. However, tubes of 20 can be an excellent investment option, and a full monster box can be ideal if you want to save money by buying in bulk. Monster boxes are also great for storing and protecting your coins!
Popular Silver 1 oz coin introduction dates:
- American Silver Eagle - 1986;
- Canadian Silver Maple Leaf - 1988;
- Chinese Silver Panda - 1989;
- Australian Silver Kangaroo - 1993;
- British Silver Britannia - 1997;
- Austrian Silver Philharmonic - 2008;
- South African Silver Krugerrand - 2017.
As opposed to coins, silver rounds are not considered legal tender and, as such, can be produced by either government mint or private mint (e.g. SilverTowne or Scottsdale Mint).
Because they carry no face value and are not designed for circulation, private mints may produce rounds with their own design, or even unique designs based on customers interests and specific topics or series.
It’s even possible to produce rounds with the intent to replicate a historic or popular coin series. However they cannot be the same size and weight of a government’s mint issued coin and should also be printed with specific markings in order to differentiate them from the original coin, such as the mint’s specific markings, an “R” (for replica) or the word “COPY” inscribed on the obverse.
Given the fact that rounds derive their prices directly from their silver content, they can make for a great investment if you do not worry about collectible value.
At SD Bullion you will find various silver bullion rounds, from very small fractional weights, to larger 5 oz silver rounds. The most common sizes are:
- Fractional Silver Rounds: these include various sizes, from the 1/10 oz (3.1 grams) of 0.999 pure silver through ¼ oz silver rounds to the top seller half oz (15.5 grams), which contain twice as much pure silver as the ¼ ounce (7.77 grams) silver rounds;
- 1 oz Silver Rounds: These popular rounds contain a full troy ounce of silver, but are still small and easy to store. The 1 ounce Silver Buffalo Rounds and the 1 ounce Silver Freedom Rounds are some of the top sellers here at SD Bullion;
- 5 oz Silver Rounds: A good option for those willing to make a larger investment, but still being affordable compared to buying gold. When available, investors can pick gorgeous designs such as the Aztec Calendar Silver Round, the American Silver Eagle Replica Round, or the SilverTowne Prospector Stackable Silver Round.
Silver bullion bars are also made to the .999 fineness as most silver coins. They are produced in a variety of sizes and shapes, from 1 gram to 5 kg or even larger.
Private mints are responsible for most of the bullion bars on the market, although the Royal Canadian Mint and the Perth Mint offer them as well.
Bullion bars are usually cheaper to buy than legal tender coins, as their value comes directly from their precious metal content, just as it is with rounds.
Silver bars mostly come in two different forms: minted or poured.
Much like coins and rounds, minted bars are printed with a design and are cut from bar stocks, whereas the poured versions are simply made by pouring molten silver into molds, forming ingots.
There are numerous silver bars for sale on our website. Listed below are some of the most popular designs and their Mints.
- Royal Canadian Mint Silver Bar: The 100 oz Royal Canadian Mint Silver Bullion Bar is one of the most regarded in the industry. It carries the Mint’s maple leaf design along with a stamp of .9999 pure silver (“argent pur”, as it is written in French). Due to its higher level of purity, backed by the Canadian Government, the 100 oz RCM is one of the most liquid in the market;
- Sunshine Mint Silver Bar: These excellent quality bars are marked with the Sunshine Mint famous design on the obverse, an eagle soaring against a blazing sun. They are also produced on the 100 oz size with .999 fineness.
- Scottsdale Mint Stackable Bar: Minted in the 10 oz size with .999 fine silver, the Scottsdale Mint Stackable Bars depict their majestic lion head logo and the inscription “IN GOD WE TRUST” on the obverse.
- Fortuna from PAMP Suisse: Embellished by the Roman goddess of fortune, these bars are produced by the Swiss refiner PAMP Suisse, considered by investors as the world’s primary bullion brand.
Here you can check our guide on How to Buy Silver Bars
Also known as 90% Junk Silver Coins, the term junk silver refers to old coins that have no more numismatic value, in other words, they are worthless to collectors, thus, their value derives straight from their precious metal content.
Usually, silver coins minted prior to 1965 are considered silver junk. Their alloy ranges from 35% to 90% pure silver, which means they contain less silver than more contemporary coins.
Although junk silver is not considered scrap silver, they have no appeal to collectors due to their natural wear. However, 90% silver coins are wildly popular with silver investors due to their low premium prices and potential collectibility. Investors that are concerned with future possible currency crisis also value these coins due to their potential bargaining power.
Other Silver Products
If you would like to expand your collection, it is also possible to invest in a variety of silver products, such as:
- Silver statues, like the Lincoln Memorial 11 oz Sterling Silver Statue;
- Silver banknotes, which are flattened silver foils, designed after official paper banknotes, that also carry a face value;
- Ancient silver numismatic coins, certified by the NGC, guaranteed to have been in circulation during the Roman or Ancient Greek Empire over two millennia ago!
One thing to note: these products tend to carry a higher premium price over the current silver spot price per ounce.. They are more based on their numismatic/historical value, their design and the work that has been put on into their minting.
Bars vs Coins vs Rounds
For most investors, bullion coins could be the best way to invest in precious metals. This comes from the fact that sovereign coins are easily recognizable, easy to trade and generally sell at higher premiums than bars or rounds.
However, due to the additional quality, artistry and effort that goes into minting a coin, and also its numismatic value, a coin’s troy ounce rate is usually higher than that of a bar or round.
On the other hand, silver bars can be better suited for larger investors. If you are planning to make a large investment and have no regard to the numismatic value attached to the product, bars could be the way to go.
Silver rounds are an easy way into the market because they contain a healthy amount of pure silver and are usually sold at lower premiums over the spot price of silver.
So, to sum up:
- Coins are typically preferred for their numismatic value and their government-backed precious metal, making them easy to liquidate;
- Bars are generally preferred by large buyers;
- Rounds could be a good way into the silver market.
How is the Silver Bullion Price Calculated
Like most commodities, the price of silver is usually determined by speculation and supply and demand. However, contrary to gold, one factor that dramatically boosts silver demand is its wider range of uses, especially for industrial production.
Industrial demand for silver has increased over the last years, especially in growing markets, like photovoltaic (solar) energy, automotive industry and electronics, causing silver demand to go through the roof.
Needless to say, silver is constantly required by the jewelry industry as well. It’s lustrous, not difficult to sculpt and long-lasting.
In addition, precious metals in general are considered a safe haven investment during economic downturns as we have already mentioned. In terms of coins and bars, silver consumption in 2020 was twice as high compared to 2019.
Silver Spot Price
A spot price is the current price in a marketplace for a given asset (such as commodities) which can be delivered immediately.
Just like gold, silver has a spot price. It is the cost of one troy ounce of silver at that exact moment. Silver spot prices fluctuate during the day, sometimes to the minute, and definitely by the hour.
Historic silver spot prices chart up until the second quarter of 2019
The silver spot price can be calculated per gram, per kilogram and per troy ounce.
In a single troy ounce, there are 31.1 grams. That means the silver price per troy ounce will be 31.1 times higher than the silver price per gram. That being said, the price per ounce is generally lower when you buy more units, so the best way to maximize your investment is to buy larger volumes.
However, it is hardly possible to buy silver precisely at the spot price, since dealers add slight commissions (called premium) to the spot price to ensure a profit. Without premiums, dealers and suppliers would not make a profit.
Here at SD Bullion, our silver bullion prices are constantly being updated to reflect the accurate rate of silver on the market, as well as our dealer premiums.
Buying Physical Silver vs Silver Stocks
According to specialists, the best way to invest is to have a diverse portfolio, rather than putting all your money in a single market.
Investing in silver usually means a mid to long-term investment. You should not expect to turn a high profit in a short period of time, as opposed to stocks.
However, silver poses a safer investment, especially in the midst of a bear market.
Most agree the best way to invest in silver is to constantly track its historical and current spot prices with a performance chart and holding on to your bullion until it is the right time to sell and make a profit, without worrying that you will lose your investment overnight. Remember, there are no counterparty or default risks when investing in physical metal.
- It’s important to have a diverse investment portfolio;
- Our experience shows that silver can outperform stocks in the long run;
- Keep track of the historical and current spot prices to know the right moment to sell;
Buying Silver vs Gold
The reason gold bullion is so much more expensive than silver is not because it is yellow, but mainly because of its rarity. Each year, the amount of silver mined is almost ten times greater than that of gold.
The average range between the price of gold and silver since 2001 has been 60-1. That said, silver prices tend to be more volatile because of its much greater use in industrial productions as we have covered above.
When industry production is on the rise, demand for silver also tends to rise. If industry production is low, silver rates also tend to drop.
That means silver is more open to speculation, meaning it can turn a greater profit if sold at the right moment. Gold rates, however, tend to stay more stable over time.
Although both precious metals pose as great options in a bear market, silver tends to be considered a better choice for those who are just starting to dip their toes into the precious metals market simply because of its affordability.
Silver vs Other Precious Metals
Gold and silver are not the only precious metals in which to invest. Let’s take a look at a few other options:
More than 75% of the globe’s platinum is mined in South Africa. It is traded as a commodity, just like gold and silver, in the New York Mercantile Exchange (NYMEX) and the London Platinum and Palladium Market.
Because it is much rarer than gold, it usually fetches a higher price than the yellow metal during political and economic stability. In a bear market, though, its rates tend to be lower due to demand swifting in favor of gold and silver.
Like silver, platinum is seen as an industrial metal, especially for the automobile industry. It is used to produce catalysts that reduce harmful gases to the environment. When auto sales and production are high, so will the prices of platinum.
Arguably the most sought after platinum bullion coin in the world is the Platinum American Eagle, issued by the U.S. Mint.
1 oz American Platinum Eagle
Again a metal with diverse industrial uses, particularly for automobile and electronics.
Pure palladium is malleable, but it can get harder and more durable than platinum if worked under the right conditions.
Like platinum, palladium demand comes mostly from auto production. It is also used to reduce noxious fumes from vehicles that run on gasoline.
Russia and South Africa account for most of the palladium mining in the world, thus, political instability in those countries might affect palladium prices deeply.
In 2017, the United States Mint announced they would be expanding the American Eagles series to include Palladium coins.
The Palladium American Eagle Bullion coins feature on its obverse one of the most admired designs in american coinage history: the “Winged Liberty”, as rendered by Adolph A. Weinman.
1 oz American Palladium Eagle
Copper rounds - random designs
Usually overlooked by most investors, copper also has a wide variety of uses, from decorative, to industrial production and also for manufacturers.
Lately, it’s seen, by a growing number of investors, as a way to diversify their portfolio and increase protection against further currency devaluation.
At our store, you can find a variety of copper round gorgeous designs for sale.
Contrary to gold, you might think silver is more difficult to store, given the fact that for the same dollar value, silver requires much more storage space. And, in fact, that would be a correct assumption.
However, it is not really impractical to store large amounts of silver at home and, in fact, it is even recommended to have your silver investment (at least part of it) at an easily accessible location. Granted its high liquidity, at a time of crisis (personal or national) you will not have to worry about lack of access to funds.
But having your silver investment readily available, does not necessarily mean keeping it inside your sock drawer.
First of all, if you are planning to keep some silver at home, bear in mind that you should use multiple locations, rather than just stacking all your bullion in the same spot. Just make sure to have all location descriptions in a sealed legal will.
Another fine idea is to keep some decoy coins at an obvious place for thieves. That way, if they fall for your trap, you might be able to keep your entire investment.
If you are in need for some ideas on where to hide your silver bullion, check out this video → https://youtu.be/1xJE1ik3So8
Still, if you would feel more comfortable to have your physical silver safely deposited somewhere else, you might be happy to know that SD Bullion has a great and affordable solution for you: SD Depository.
SD Depository is our non-bank, fully-insured segregated storage depository. We offer the lowest price depository for your precious metals. Guaranteed! Storage starts at only $9.99 per month and new customers currently get the first three months for free!
Check out more information at the designated page for SD Depository.
If you are planning a retirement plan, you might want to consider a self-directed IRA.
Self-directed IRAs have the same tax advantages as any other IRA with one difference: the investments are managed by yourself. That means you have a broader range of options for investments, including hard assets such as precious metals.
A Silver IRA is, to put it simply, a self-directed IRA in which you decide to include some sort of silver investment. That way, if you choose to sell your silver in the future, your gains will be tax-free, as long as you keep the money in your IRA.
In addition, all 50 american states have either a full or partial exemption from potential creditors' abilities to access your IRA assets.
Here is a list of popular silver IRA products:
- American Silver Eagles;
- Canadian Silver Maple Leafs;
- Perth Mint Silver Coins;
- British Silver Coins;
- Chinese Silver Pandas;
- 999 Fine Silver Rounds;
- 999 Fine Silver Bars
For more information, make sure to check our page dedicated to Gold & Silver IRAs.
Where to Buy Silver
Here at SD Bullion you will find a diverse number of silver coins, rounds, bars and even other silver products.
We take pride in offering you the lowest prices and crystal clear transparency when it comes to spot prices and our product prices.
Head over to our page for Silver Bullion Products and start planning your investments. We have an assorted selection of rounds, bars and coins for sale at reasonable prices that will sate the appetite of both investors and collectors.
Check also our guide on How to Buy Gold Online if you want to learn more
How to Sell Silver
If you are willing to liquidate your assets, please do consider selling them to us. Our team is constantly buying silver and will provide you with quick payments at industry leading rates.
To get more information regarding our buyback process and pricings, click here.