Just Bought My First Silver Bullion - Think I Paid Too Much?

Hi all,

Please go easy on me, I am a new collector of silver Bullion coins. I purchased my first coin yesterday. It's a 1oz Canadian Silver Maple 2011.

I paid $41 for it. Today I feel like I've paid way too much for this. Can anyone advise without leading me astray?

~Russ

 

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I wouldn't worry about it too much, russells... even though silver is dropping like a rock, just hang on to it. What goes down must come up!

 

Ok,thanks. I'm hoping it'll keep falling for a while so I can build my stack ;-) By the way, what is the difference between generic silver rounds and silver bullion coins? I understand that you pay a premium on bullion coins (am I right?) whereas you can pay very close to spot price on generic rounds. Why is this?

Still learning...

 

Unless there's some collector value involved, there is usually a slightly higher premium involved with silver bullion coins because they are generally a little harder to counterfeit. Since they're a little safer to buy, that assurance comes with a slightly higher price tag.

For example, my local coin dealer sells American Silver Eagles, Canadian Maples and Mexican Libertads for $4.50 over spot. They sell generic silver rounds for $3 over spot.

Edit: ...and congrats on your first buy. Who cares what you paid for it. It's yours now and it's cheaper than you would have paid for it three months ago.

 

I am just getting started and am learning on the fly myself, but this is some of what I've gathered over the last few months. My local shop charges spot for 90% silver coins, spot + $2 for rounds and bars, spot + 3 for maple leafs, libertads, etc., and spot + $4 for silver eagles. They buy back rounds and bars at spot and silver eagles at spot + $1. Personally, I think the extra buck or two is worth it as I simply like the government issued bullion better. Plus, you may be able to recoup some of that premium if/when you sell.

 

You did overpay by most peoples standards, but that's not the real issue. The real issue, in my opinion, is that you went into it uneducated and did a good thing by trying to educate yourself, even if it is after the purchase. No big deal, but don't dive in without some kind of real info. I think you're on the right track by trying to find out what things sell for, and maybe you should check out what the etailers are selling bullion items for. There are countless threads on here with links to their websites, Apmex, Provident Metals, Gainesville coins, Goldmart and others. Take a look at them and compare what they are selling, the prices and shipping. Get a good idea of total cost to get it in your hands and you'll at the very least have a good idea of what these things sell for and what they should cost you.

 

I think that you've just started ... and for starter it is not that bad. Just keep learning ... paying more or less - is one of the lessons

 

The dealer who sold you the maple leaf must have smelled the blood in the water and went in for the kill. Newbies are a dime a dozen these days walking into coin shops without any defenses (knowing how much stuff costs and whats a fair mark up). While the shark dealer may have won the first battle ..next time arm yourself with some education. He might still beat you up but atleast you can fight back and not lay down and take it or cower in fear.

Learn to defend yourself against the sharks ..they are all around you and are ready to strike at newbies before they get wise to the game.

 

Well, dealers ... 10 days ago attended Coin Convention in Tokyo ...
Dealers there charged twice the price for bullion ... So, may be dealer didn't want to take advantage over newbie ... maybe he just kept this mark up for all?!
Anyway - education is very important part.

 

In the future when buying silver bullion coins like the Maple Leaf or American silver eagle, you should shoot for paying a premium around 10% over spot. That's a good deal. At today's spot price of $28 that would be around $31-32.

You paid maybe $10 too much. You may feel the sting now, but in reality it's a very inexpensive lesson.

Kudos to you for admitting your inexperience and seeking knowledge. Now the next step is to use that knowledge to get better deals in the future!

 

What's all this talk about diving in head first, and sharks smelling blood in the water? He bought one coin for $41. It's not like he took out a second mortgage so he could buy $50,000 worth of coins.

 

Wisdom

A wise man once told me, you haven't lost any money until you've sold. You'll get your money back on that purchase I'm sure.... More importantly, you've now learned a lesson that will save you a boat load. Due diligence is so important. The cool thing about buying online is that these guys all have to compete with one another, so if you look around you'll find out who is fair and who is not. Watch for promotions and enjoy yourself!

 

Yeah, you paid way too much. Silver yesterday was what, $28-ish? So that's quite a premium. And buying bullion in such small amounts can get a lot more expensive (buying 1 Silver Maple or ASE at a time).

You could consider "junk" 90% US silver coins--usually less of a premium. You could try fee-bay for that, but it is more inefficient buying small amounts. And read this forum a lot, & do more research, & good luck!

 

We all make mistakes when beginning. Consider it tuition. My advice is to read here and learn what acceptable premiums should be. Also, go to major dealers like Apmex and others. Pay attention to what major dealers charge, that should usually get you in the ballpark.

Chris

 

Daniel, Welcome to the forum!

With the USD and the CAD almost exactly at par, you can buy wherever you get the better deal, without basing it on an exchange as precious metals is denominated in USD. Commodities, including precious metals ( and the foreign currency { except the swiss franc}) is being killed by the strong dollar.

Some just buy when the impulse strikes, rather than when the dollar is strong or getting stronger ( like now) when you get a lower price. Others like to follow a trend and buy when the dollar is weak and the cost is greater hoping it will go higher. So educate yourself on what can effect the price of PM, and use it to your advantage. The US isn't collapsing, there is no conspiracy to hold the price of PM low and some day it will shoot to the moon, people aren't pushing the demand for it higher, and the demand is not far out pacing the supply. Bullion sites will use these misconceptions to try and sell, so be aware of them. IMO. I am sure some will disagree, so do your own research

Jim

 

Where I live $41 for one ounce is a bargain

So don't feel too down.

 

$41.00 is a little high for a Maple 1 oz. Whenever I purchase silver eagles, I try to get them below spot (sometimes happens), at spot (happens more), or sometimes up to $1.00 over spot. You paid a little too much, but as others said, it's good to learn that lesson now and in the future stay away from dealers who will try to take advantage of you.

 

Thanks for all the feedback, everyone. I've been doing a lot of research online (I don't have any local coin dealers) and as I'm in the UK, I actually got the coin around £10 cheaper than any online dealer and ebay listing so I personally feel I got a good deal.

 

For real? Can you expand please? Is it that dealers are not lowering premiums with the spot price, or it's just hard to find, maybe both, or something entirely different? Is it only in your immediate area or all over UK? Very curious as to the details.

 

Sales tax is 20% in the UK.


This is by far the cheapest bullion website in the UK. A silver eagle today £24.05 ($38.04)... However postage on this website is £15 ($23.72).

Dealers in Bullion are rare as well, almost every coin shop deals in old British and Roman coinage. When you do find one for sale in a shop... they're £30 ($47.45) if you're lucky. The closest coin shop to me has had silver eagles in the window at £39.99 ($63.27) for like 2 years.