Am I just another bandwagon sucker?

Hey there guys. I'm a high school student and I don't have a job, but I recently came into a bit of money in the region of 600-700 bucks from a contest I won. This money came to me essentially free and required very little work, so I figured I'd get back into this silver game. I foolishly sold my mini-treasury of 80 oz a year or so ago, back when silver peaked at 18.00; I'm not kicking myself too hard because it was great at the time and it had been at 12/13 an ounce for so long, and seeing as I paid 12-15 bucks an ounce for it, I figure I still came out ahead.

Anyway, I recently bought 20- 2010 MS Silver Eagles through APMEX at the prices quoted a week or so ago. I'm almost certain I've gotten back into the game too late; the odds of me making any money on this is probably fairly slim. So what do you think, was this a wise decision to make, or is 650.00 spent better elsewhere? I appeal to you bullion-enthusiasts hoping for at least an optimistic spin, even if the news is something I'm going to feel bad about LOL

At the end of the day though... it sure does feel good to be back in this game; and after so long!

 

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If we could tell you what's gonna happen in the future, we'd all be rich, man.

I think you're getting in high, but not too high.

 

I think it really depends on how long you plan on hanging onto them. If you wait several decades to sell I doubt you would lose money. In the short term its questionable and up for non-productive debate. I'm not a bullion investor though. Just pick up the 90% stuff when I can.

 

You're not a bullion investor but you are posting in the bullion investment forums? Makes sense to me....

 

One doesn't need to be a bullion investor to know the technicals and fundamentals of bullion.

 

I am glad you made a profit on your initial purchase and sale. PM's are an underfinanced violatile market, so success is not guaranteed. However, if one can afford to tie up the capital and wait for the moment, you should continue to be successful. Only when you find it necessary to sell and have no other choice will yo lose money. Just wait until PM's show you a profit before you sell. IMHO

 

Great for you! I'd guess that there aren't very many high school students thinking about making money by buying and/or selling silver! Awesome! And since your recent purchase was paid for with "essentially free" money, well, you can afford to sit back and see! You are NOT another bandwagon sucker, I just bet. And while everyone has a different opinion, mine is that we're not ready to crash and burn just yet. Uncommon thinking for a young person... interesting. Hang in there! Lucy

 

Hi cubenewb,

I congratulate you on having such uncommon sense for a high school student. Always said the kids were smarter than us old guys.

Don't worry about being too late. In the grand scheme of things, you're early. Have a plan to regularly add to your stash. In investing circles they call it Dollar Cost Averaging (DCA). This is where you buy a fixed dollar amount of shares on a regular periodic basis - let's say once a month with $100. The stock's at $10. I buy 10 shares. Next month the stock goes up to $12. I buy 8.3 shares. Next month it goes down to $8 and I buy 12.5 shares. Over time, I average out the highs and lows of the market. Granted, this sucks when the market is going straight UP, but most often, and even in this great and glorious bull market in gold and silver, it goes up, comes down, goes up, comes down and looks like a slopping zigzag line. feh. That's how markets work.

Many advisors are now recommending that people own some bullion as a core investment. Perecentages range from 3-5%, although some of us think we need more. I think of real hands on bullion sort of like my 'bed buddy' after the stuffed animals my grand kids have that they take to bed to help them sleep. My stash helps me sleep.

peace,

rono

 

I don't know if buying the SAE's through APMEX was the best way to go. You paid $32.50 per coin. If and when you decide to sell, most dealers would likely give you 15-20% back of bid. That means that the price of silver would have to rise to $38-40 just for you to break even. Without knowing where you live, you might have been able to get a better deal at a local B&M. At least there, you could haggle for a better price.

Chris

 

At least you didn't spend it. Your actions are reasonable and I don't think it is too late to buy silver. However, my personal opinion is that young investors should look to the stock market first since that will be a better lifetime investment vehicle.

 

That's what I thought when I bought some Maple Leafs two years ago.

I believe I have doubled my money.

Who knows what the future will bring, but if you had no PM's, at least now you have some exposure.

 

Made a 103 in my high school economics class if that makes a difference. Had the hardest teacher too. And I read the bullion forums fairly regularly. I just don't have the money to collect it. Yet.

 

Sounds like you have your head on right, congrats. Why don't you also try roll searching for silver halves or dimes. I think quarters are just too jammed up with non PM's like the states and parks. If you have the time for searching it just might pay off and garner you a little cash for more ASE's. Find your best buyer of silver and contact a coin club to see if anyone is interested in what you've found. There are many ways to " play the game " and you may just find out that there is a lot more to it that you really like. Don't forget that halves run in the '40% silver bracket besides the '90%' bracket. Anything not silver you can recycle at another bank or free coin machine. Get a 'Redbook' = A Guide Book of United States Coins or go to a bookstore or library a check it out. zeke

 

Take that money and use it roll search halves. Get silver at face.

 

Here's a secret to getting good deals on silver coins. Start going to your local coin club meetings, there are many good deals to be had at their auctions. You won't know unless you try.

As far as the OP's question. It was a bad buy but one you will undoubtedly learn lessons from. good luck!!

 

The problem with APMEX is their shipping fees.
When you buy at a coin show there are no add on costs except gas for your car.

 

Who can say with certainty where silver will be in 2011 or 2021 . Think long term .

 

I hardly think "bad buy" is the correct way to word it. Sure, I paid a premium, but it's not like if it went up higher and I sold it I wouldn't be passing that premium onto my buyers. eBay is a perfect example; silver may be 28.00 an ounce buy people are paying 35+ for it. Sure there are eBay fees, but I bet if I was to sell RIGHT NOW I'd only lose somewhere between 25-60 dollars (I might even make a small profit due to the price being higher now than when I bought it). I went into this full-well knowing there was a risk, and to be completely honest, I feel more comfortable with 20 ounces of ASE than I do with 650 cash. Judging by the length of your response I doubt you meant to be so blunt; you are definitely right in your contention that this is going to be a learning experience!

I've got a little stash reserved for that already; I was a bigtime penny-searcher from about Nov 09 to May of 10 and I plucked out around ~450 wheats (nothing too special amongst them but cool all the same). I'm going to be getting into halves pretty soon, I think my efforts will be better rewarded in that realm of cherry picking.

I think you're definitely right, although I don't think I'd ever sell back to a dealer when it seems non-commercial buyers pay great prices themselves. But yes, this purchase was made perhaps too hastily, I probably should have shopped around a bit more, but I'm perfectly content with my actions and believe that the purchase, overall, was productive.

I was lucky enough to win 1st place in the ANA Lit. Awards for my division this past summer, and part of the prize was a 500.00 numismatic book voucher. Needless to say I've got the red book (my oldest one is from 2007, so I've been working with that publication for a couple years now), as well as tons of really great numismatic resources like the cherry-picker's guides, some fairly specific works on Morgans and other varieties, and a rather imposing "Encyclopedia of Paper Money" (currently using to 'crisp-ify' some fairly badly beaten bills in my collection, LOL). Your one of many who recommend searching halves; I'm looking into this currently

Thanks for all the advice guys.

 

You're in High School. Wait until you're my age to sell, and I GUARANTEE you'll make money off those ASEs.

 

If you are just buying to make money, buy the silver ETF. The mark-up is lower and the liquidity is much better than coins. The only reason to buy Eagles is if you want the coins for a collection or the end of the world.

Lack