Am I on the right track??

Hello all,

First of all, great site. I have been lurking around the forums for about a week now and I have found a lot of great information so far. But...there are a couple of questions that I have.

Ok, to make a short story long, my grandmother recently passed and I found out that she left 3 insurance policies to me. Since my 401k is not performing as I would like and I don't want to buy any stock, I thought about investing it another way. I have been thinking that gold (at this point) is too risky of an investment since I am very new to this, so I have been leaning towards silver. This makes sense to me because a mistake in buying silver will hurt a lot less than a mistake in buying gold.

Any recommendations on what to start with? I WOULD like to buy coins that I enjoy looking at vs. just buying a silver bar. I want to keep it fun while investing at the same time. Is there any advantage to say an uncirculated coin to a first strike or graded coin?

I assume that buying online is probably the best option. I do live in Manhattan and I know there are a number of coin stores within a couple mile radius of me. But should I check the stores out first or just purchase online. I figure with a store, it will be more expensive do to the over head. Any thoughts??

Last question (for now)...why is the 2012 2oz Australian Lunar Year of the Dragon LESS than the 1oz coin?

So to sum all of this up, I am thinking about buying silver coins that I like (Year of the Dragon, Canadian Maples, etc..), buying online (Gainesville Coins) and not making larger purchases (like silver bars) until I learn more. So like the title says, am I on the right track here?

I appreciate any and all help or suggestions. Thanks!!

 

Log in or Sign up to hide this ad.

Welcome. I'd avoid year of the dragon or really any lunar coins for investment purposes, because of the hefty premium

 

American Silver Eagles

 

Loungefly, glad to hear you have an interest in real money I think you are on the right track. I would caution that silver is actually riskier than gold, but you can buy smaller increments of it so your risk exposure can be less with silver. I prefer silver due to risk vs. reward, having the greatest potential due to lower supplies than gold above ground and being the 2nd most useful industrial commodity on the planet.

As for which silver coin is best for you, it depends what you want out of it. If you want something that has strong resale value, worldwide recognizeability, and easy to detect fakes, you can't beat the ASE with the Canadian Maple Leaf a close runner up. I like Canadian coins for 99.99% purity instead of 99.9% because 9999 is used for silver in solar panels which are slated to become a strong factor in silver demand going forward so 9999 fine could possibly one day have a greater premium, just speculating. For that I like the CA wildlife series which is close to the price of ASE's and CML's, but IMO has a lot more upside due to better designs and mintage of 1 million as well as being part of a series that is in demand. If you want protection against downward price moves then premium bullion coins might be better, such as pandas and lunars which I also like. I also like generic bars and rounds for maximizing my ounces as well as junk silver for liquidity. This is my method of diverisification plus a little fractional gold. The other nice thing about silver is that you can get a lot better premiums on the resale. With gold it's so expensive that if you have a 1 oz coin for example you won't get much over spot for it when you sell, where as a roll of eagles you can sell individually each for a small premium that would outpace gold when you add it all up.

 

Buy Art. Its a better investment.

 

Welcome to CT! :welcome: Buy what you like. If it is available locally, you should get a better deal. I bought the 2oz instead of the 1oz lunar dragon. It is priced lower because most bullion stackers like the 1 ounce size. I would rather have 2oz than 1oz though. If you order online, shop around. I like Provident Metals. :smile TC

 

You need to realize something very basic. Sometimes what you consider a "hefty premium" is really not hefty at all if they perform with a better return on your investment. If you pay spot + $3 for a silver eagle, and that is about all it will return based on historical performance, 1996 not withstanding, then your investment is tied to spot and spot alone. The lunar coins are still tied to spot and the premium is more per coin, but their performance as a ROI surpasses the eagle by as many times as you can fold a piece of paper.

You need to look no further than the 2009 lunar ox and 2010 lunar tiger and your thought is so off-based that it's really not a debating point.

Back to the OP's question about the 1oz vs 2oz dragon. The 1oz size has a mintage limit of 300,000 coins. The series 1 issue dragon was and still is the hottest and most expensive of series 1 and commands the most premium even though it has the highest mintage of the series. The 2 oz has no mintage limit and therefore does not have the perceived limitation of the 1oz. The other thing is most coins are available in that standard 1oz size, so since the size is standard, many don't see going outside of the standard unit of size. That 2oz dragon is a good buy, so are the rabbits at about the same money, IMO. You might not be able to sell them next week, month or year and see a nice return. Based on historical info you should realize a nice return down the road.

 

Yeah, buy my art. It's bound to go up!

 

You're going to die soon?

 

Well, it seems to me, from the flavor of you post, what you are really looking to do is COLLECT silver, with the hopes of it going up. If that is case, I recommend you buy any coins you like while keeping a close eye on the premium over spot and try to keep that premium as low as possible.

If I am incorrect, and you are seriously looking to INVEST in silver with a meaningful outlay of cash, I would say slow down. What you need to do then is read and gather as much info as possible, and then come to a conclusion of whether of not, at $28 per oz. in 2012, is Silver valued for a good investment?

Mike

 

Silver is generally more volatile than gold so if you are worried about relative safety or would experience undue stress with large price swings gold is probably a safer bet. It also depends on how much your talking on investing perhaps a mix of gold and silver would be something to consider.

 

And there is something you need to realize, which is even more basic. The lunar series is basically fueled by is collectors value. It's only as valuable as the market of collectors you can locate to meet your demand. If you can't locate a market, which may not happen in the future, your high premium is lost money. Although for the past and current the lunar series has been stable and for the most part profitable, at the end of the day if the market turns soft, you have whatever the melt value is. Where as a series like ASE's demand a low premium (except for some select years/mint marks).

 

You stated you'd avoid them because of hefty premium. The fact of the matter is they command that premium and more as a very short amount of time goes on.

While you're correct that if the collector market for them disappears so will the premium, but that's akin to if silver spot drops you can kiss any investment profits goodbye on those ASEs as well.

 

I can agree with you on that, either way whatever the op invests in, it's just that-- investing and with investing comes risks

 

What makes you say that? Seems like you would have to have a lot of knowledge to successfully invest in art, where as anyone can buy silver or gold bullion near spot without much knowledge at all...........

 

http://online.wsj.com/article/SB10001424052748704513104575256783908983328.html

 

http://www.artbusiness.com/appart.html

http://www.npr.org/blogs/money/2012/05/31/153914132/is-art-a-good-investment

 

Anyone can BUY silver or gold near spot, as many, many of the silvers stackers did when spot, was $45 an oz. without much knowledge at all, just like your said. It takes a bit more knowledge to INVEST in silver though. At least to do it successfully.

As for art, I am sure it does take a lot of knowledge, but if it were easy, everyone would be doing it.

 

Investing is easy! Just follow these simple steps...

Step 1) Obtain Crystal ball...

 

I thought the art market is soft right now.