Question on investing in silver (American Silver Eagles and other coins)

I'm new to silver investing and interested in coins. I am interested in American Silver Eagles because they look to be a good starting point and they are close to the spot price. I like that there isn't a premium like there is for Morgans and Peace dollars. My question is two-fold. 1) Are ASE's a good investment, and 2) What other coins should I consider for investment purposes (not necessarily coin collecting purposes).

Thanks

 

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Umm, we cant really tell you if silver is a good investment, but i think it is a great way of storing cash into PM's and ASE's are nice for silver holding but generic bars ar not coin related, and carry much less of a premium. Right now silver is low, good time to invest. Hope this answers it for you.

Oh, also you can consider Candian .9999 silver maples, chinese silver 1oz rounds, and a long list of other fractional silver rounds, and such.

 

Yeah, I know it's difficult to say if it's a good investment. I meant are they (ASE's) a good place to "store" money. I have a few silver bars, but they don't really hold my interest like the coins. What about 90% coins like half dollars and such? I've read that a lot of people buy them for "investment" purposes.

 

:welcome:

Search is your friend... these topics have been discussed ad nauseum and I highly suggest you take a few days to go through posts on this forum. But to run down quick my thoughts:

1) Obviously, diversification should be the goal, not all in PM's. This way you don't lose your shirt if we take a big drop like as what just happened (and is still in flux)
2) PM's don't offer a "return" in the sense of stocks value appreciation or dividends, so you should think of them more as a preservation of purchasing power over the long term if you think they will outperform inflation (I subscribe to this theory)
3) Buy over the long term by Dollar Cost Averaging - a few bucks every week/month will help you hedge against big dips or spikes over the long run, such as the large downward "correction" we're currently in the middle of
4) Morgans are susceptible to a good amount of fakes, as are other bars and rounds, you can find a lot of threads on this forum on how to help identify them. Buy from a trusted dealer, stick with 90% or 80% junk silver and ASE's & Maples from trusted sources to start with and buy a good magnet, gram scale and test kit and get familiar with how to use it.

As far as a good investment, only you can decide whether it's right for you, and I'm serious, please search and go through a lot of recent discussions. You'll see many good viewpoints from all sides and it can be very informative and help you make the best decisions on what to do.

Me, personally, it's a hedge against inflation and I stack long-term to protect any decrease in the purchasing power of the dollar over time. I tend to buy 90% junk silver (old and new) mostly, as well as collect "numismatic silver", i.e. Silver Ikes, Silver State Quarters, Franklins, Washingtons, Mercs, etc. Doing that gives me both the comfort of hoarding the silver and also being able to appreciate it's numismatic side.

Good luck to you sir.

 

ASE and everything else has a pretty hefty premium right now. If you can find ASE's close to spot then I would buy them up. Cheapest i've seen them going for is like $30 dollars and thats 7 dollars over spot.

 

ASE is probably the most "staple" silver investment there is if you are in the US, and even elsewhere. But as was pointed out the premiums are very high right now due to extreme demand so you will get a lot more bang for your buck by buying generic from a mint that produces bars and rounds that can pass on much lower premiums (and long delivery delays).

If you are buying small amounts here and there, and if you can find them at your local coin shop for a decent premium, I like ASE's the best. Government minted silver means they command more trust, they are well recognized, there are standards that can be verified and it's more difficult to successfully counterfeit a government coin (plus heftier punishment) than a generic round or bar. I also like junk silver but the premiums on that are high right now too. Usually that is around spot and can be had for cheap premiums.

 

Thanks to everyone for your replies. They are helpful. I've searched and read until I confuse myself. Paralyzed with too much info.

I did go ahead and buy to ASE's at a little less than $7 over spot. I know it's a bit high, but I am looking long term so it doesn't bother me too bad. Dollar cost averaging right? But I will set that as a limit (not to buy when it's over $7). What would be too much for junk silver?

 

Normal premiums for ASE's vary between $2 and $5 over spot depending on the market and the dealer. Typically online is on the lower end if you buy in bulk (plus shipping) and your local coin shops will be a little higher unless they have some that aren't in great shape which can be had for cheaper. Since spot has dropped so much $7 over right now is still the best overall price point you could have had in over 2 years (barring finding cheaper premiums right now which is difficult). In my book that's whats important, total paid, not the premium.

You have the right idea, invest for the longterm and DCA. Silver is the most volatile market in the world and many folks have been burned trying to play it in the short run, but if you look at both gold and silver over the last 10 years, even at today's prices have been quite lucrative.

Junk silver is typically had for close to spot price. Hopefully it will come back down but time will tell. It may take higher prices for premiums to come down. This is the largest disconnect we have seen in nearly 5 years. Right now I would try to find it for around $4 over spot per oz or better.

 

Good info. I was looking around online and 90% is quite high right now. I'll watch for it around $4. It's nice to have some parameters when starting so I don't overpay too badly!